The new AECC development will feature a conference centre, energy centre, anaerobic digestion plant and two hotels and will be built by Aberdeen City Council's development partner, Henry Boot Developments.
The Council says the income streams identified to cover the costs of the development will reduce the cost to an average £100,000 per year over a 35-year strip lease, as opposed to £1.55m.
This covers the exhibition and conference centre and one hotel. Plans were presented to Council in October 2013. At the end of the lease, the council will be entitled to purchase the AECC development, including the land, for £1.
The Council also said annual subsidy paid for the existing facility will not be required for the new AECC, saving the council £1.3m per annum.
Officers were instructed to investigate methods of reducing the cost of a new AECC to the City Council, which had previously been put forward as £54.1m over 35 years.
Development costs of £333m have been offset by the income streams.
City Council Leader, Councillor Jenny Laing, said: "I am absolutely delighted that the financial proposals for the new AECC have been approved by Full Council. The new AECC, which is a key element of the business infrastructure needed to promote Aberdeen as a world energy city and the Energy Capital of Europe, represents a significant, but very affordable, investment for the city. The AECC is a key element of our Strategic Infrastructure Plan.
-- Advertisement --
"The proposed new AECC in Dyce is an exciting development for the city and will provide a potential step change for the future by providing a modern and fit-for-purpose facility.
"This new development will showcase Aberdeen as a global destination for business and leisure tourism by delivering a level of sustainability and design excellence that will be fundamental to strengthening Aberdeen's international profile The new AECC will provide an opportunity for the AECC and Aberdeen to capitalise on the potential for meetings, conferences, exhibitions, entertainment and banqueting markets locally, regionally, nationally and internationally."
Aberdeen City Council Chief Executive Angela Scott added: "We have worked very hard to reduce the council's financial exposure for this essential new facility to the council by more than £50m in the face of the overall development costs increasing as a result of a number of factors, including inflation and increasing construction and infrastructure costs. The expanded development now includes a second hotel and an energy centre, which have been added to bring in additional income streams to offset the development costs.
"The AECC generates more than £80m for the north-east economy each year and approximately £140m in Offshore Europe years, but the existing centre is no longer fit for purpose or big enough to accommodate the growing industry conferences or entertainment events. Without a new facility, there is no doubt Aberdeen will lose out on these events and the significant economic benefits they bring."
The proposed new AECC is 9,000 square metres and provides flexibility to host a range of exhibition, entertainment and sporting events. Space is 10,000 seated and 15,000 standing.
The proposed new AECC is to be built on the site of the Rowett Institute in Dyce.
(IT/JP)
