A new deal for Cardiff's bus station has been agreed between the Council, Rightacres Property Ltd and Welsh Government. The deal will secure offices as part of the mix-use scheme and will enable the development to move forward without having to wait for an office tenant to be secured.

A report to Cardiff Council's Cabinet today has approved to transfer the leasehold interest in land owned by the Council at Central Square and set aside for the bus station development to Welsh Government.This now enables the full site to be assembled before the development is ready to be sold to an institutional investment firm on the same terms. 

The new deal will also see the Welsh Government-run Transport for Wales take a lease to operate the bus station part of the new development.

Transport for Wales see the new bus station as a core part of a new integrated transport hub that will be brought forward through the Metro Central project. This project recently secured a £40m in-principle commitment from the City Deal. Welsh Government and Transport for Wales want to ensure the bus station and train station operates as a single transport entity enabling passengers to transfer seamlessly between transport modes. Giving Transport for Wales operating control over the new bus station will help deliver on that aim.

Now that Cardiff Council's Cabinet has agreed to sell the leasehold interest in the land to Welsh Government, a new Metro Delivery Partnership agreement will be signed between the Council, the Government and the developer Rightacres which will oversee the whole Metro Central project and enable work to begin.

The bus station scheme has been reviewed, but will still deliver the same 14-stand bus station with 10,000 sq. ft. of retail space on the ground floor. The car park will now be built over two levels - significantly reducing the build cost - and there are plans for 300 apartments facing Wood Street and 85,000 sq. ft. of Grade A office space facing Saunders Road on the top level of the new building.

Although a new planning application will be required for the changes that are being made to the building, the development does have planning permission so work can start on the foundations of the development once a contractor has been appointed.

Councillor Russell Goodway, Cabinet Member for Investment and Development, said: "Through the arrangements that have been put in place since May, the new bus station will now be built on a commercial basis. Cardiff will have a new bus station and the Council will recover the lion's share of the money spent on the scheme to date. Bringing Welsh Government and Transport for Wales in as partners has enabled the Council and the developer to get to a position where the construction will now be delivered on a fully commercially basis without any further need for Council investment.

"Importantly, Welsh Government's involvement has secured offices as part of the final mixed-use scheme which means we still have a good chance of securing the major inward-investment project we have been working on together over the past 12 months."

"This project has always needed to be affordable to the Council, hence the delays in bringing it forward. We needed to make changes, but we are now confident we have a scheme and a partnership that will make it happen, and we are hopeful that works will start on site next month."

The recommendations to Cabinet that have been approved are:

·         The principle of the Metro Delivery Partnership agreement between the Council, Welsh Government and Rightacres

·         Selling the Council owned leasehold interests in land at Central Square to the Welsh Government.

The new model to fund the bus station will enable the Council to recover most of the costs it has expended on taking the project forward to date.