The Dreamland estate was sold by Thanet council to park operator Sands Heritage Ltd for £7million, it has been confirmed in a report today.
The sale, one of the biggest asset disposals in Thanet council’s history, included the amusement park, the TDC restored Dreamland cinema and Sunshine Café building and the 400 space car park.
Part of the sale income has paid the compulsory purchase order compensation to the park’s former owners DreamlandLive -formerly Margate Town Centre Regeneration.
Total CPO compensation and related costs will amount to £5.8 million, of which £2.15 million has already been paid.
In 2008 the Scenic Railway was partially destroyed by fire after an arson attack. The then owners pledged to rebuild but Thanet council threatened to compulsory purchase the site if it was not repaired. That CPO was served in 2011 and approved by government the following year but protracted legal arguments meant notice to quit was not served on DreamlandLive until 2013.
At that time, the scenic railway was burnt down, the amusement park was closed and there were no plans for redevelopment.
In 2015 the park reopened with Sands Heritage Ltd (SHL) at the helm following £19.4 million funding from the Department for Culture Media and Sport’s Sea Change programme, the Heritage Lottery Fund and Thanet District Council, which had contributed £8million. Investment was also made by SHL.
But the operators went into administration in May 2016 after SHL suffered financial difficulty at the end of 2015 and entered a voluntary debt plan. The company had been hit with a net loss of £5 million and owed bills of £2,893,128.
Hedge fund Arrowgrass then bought SHL shares, secured payment of debts to bring the park out of administration and invested some £25million in re-landscaping, vintage rides restoration and the introduction of contemporary street food, eclectic bars, and a main stage.
The cash was secured by placing legal charges on SHL’s 99 year lease of the Dreamland site, and by placing charges on other, non-TDC, properties leased by SHL.
The investment resulted in a second ‘reopening’ in 2017 with a greater mix of music and events running alongside the amusement rides.
The sale of the Dreamland complex freehold was agreed in principle by the then-Conservative run council in August 2019 after ten months of talks with SHL.
The following month Dreamland investor Arrowgrass Capital Partners made the decision to shut down its master fund after a slump in capital and requests from investors to withdraw funds on the heels of a legal wrangle over the exit of a senior executive. Arrowgrass is expected to sell off its interest in the park.
The freehold transferred to SHL last December. The terms include a restriction prohibiting housing development at the site for 10 years to tackle any possible planning application outside of leisure uses. Conditions are also attached to ensure that the listed heritage structures are protected and the council has secured undertakings from SHL that the same number of public car parking spaces will remain.
The purchase price was made public today (February 22) when a report on the transaction was released. The report says the council obtained two independent valuations for the site and the disposal price exceeds these two valuations.
The report shows the sale of Dreamland park, cinema, scenic railway, rides and intellectual property, completed on December 18, was for £2.3million and the exchange of contracts for the sale of the car park, which took place on the same day and should be completed in April, was for £4.7m.
Council Leader, Cllr Rick Everitt said: “I was part of the Cabinet that took the decision to issue the CPO, so I’ve had a particular interest in the project. It felt then that the CPO carried risks, but the alternative was to leave the site, which is in a prominent location in Margate, derelict and unloved. We knew then, as now, that Dreamland carries a special place in the hearts of many people, both in Thanet and beyond.
“What successive councils have achieved is a major success story – Dreamland now is unrecognisable, compared to 2013. It has involved excellent partnership working with the Dreamland Trust, Government departments and the operator, SHL. The project has survived the operator going into liquidation and a pandemic.
“There are still challenges, not least for the new owner to manage the re-opening of the park as part of the eventual recovery from Covid-19. But we want to continue to work with SHL to maximise the success of Dreamland and the regeneration of Margate. I am grateful to all the council officers who have worked so hard on it over so many years. This is a Thanet success story and should be celebrated by all involved.”
SHL plans include establishing a new seafront hotel and conference facilities. Hotel plans were submitted by Dreamland parent company Margate Estates and approved by Thanet council in 2019. Currently the amusement park is shut and 52 staff were made redundant due to the covid restrictions.