CITY of York Council is increasing its property holdings, and councillors have approved a £15 million budget to fund the acquisition of new sites.

Councillors have agreed to the budget to start buying the freeholds of city centre commercial property, and meet higher income targets set for its property portfolio.

Swinegate Court, home to a mix of shops, leisure units, and offices, brings in £813,000 a year in rent, and on Thursday senior councillors will be asked to approve its purchase.

Papers prepared for the Executive meeting later this week show senior council officials believe buying Swinegate Court will “ensure the ongoing maintenance of the buildings, support the economic vibrancy of the city centre and generate significant additional income to contribute to the increased budget income target set for the council’s commercial portfolio.”

The property has a “strong rent roll, a respectable yield and represents a good commercial investment” the document adds.

However, the plan is not without opponents. Last week, Green party councillors abstained from a vote on the £15 million budget.

Cllr Denise Craghill said: “I still do have concerns that this is taking is down a path where the council is reliant on rental income to prop up its revenue budget, and that is quite an uncertain future. I am also not clear how this sort of path works in future if the council were in future to want to develop a better policy - as some independent traders have asked - for more proactive and sympathetic policies to support small businesses, which could be through sympathetic rents. That could create a conflict.” The property purchases are to be financed through borrowing, but officials also plan to use any future capital receipts not already accounted for to fund purchases and cut down the amount of borrowing needed. The Swinegate purchase, if it goes ahead, would follow another council acquisition on Hospital Fields Road. Late last year the freehold of Stonebow House and two sites on Redeness Street, off Layerthorpe were sold off bringing in £1 million either to pay off council debts of finance the Hospital Fields Road purchase.