MONMOUTHSHIRE council is at “an advanced stage” of negotiation with new businesses which could occupy a business park facing a budget shortfall of more than £1 million next year.

The county council’s commercial property income targets have taken a hit after Mitel Networks confirmed it will be leaving Castlegate Business Park in Caldicot in March.

Efforts are being made to actively market the site to attract new tenants, with council documents showing the site could make a loss of £880,274 next year – a shortfall of £1.089 million.

Newport Leisure Park, another investment acquisition owned by Monmouthshire council, is also expected to fall short if its income targets by about £100,000 in the next financial year.

And council documents have revealed that a review of Innovation House – which is also part of the council’s investment portfolio – is also being carried out “which may result in its disposal”.

Independent councillor Frances Taylor raised questions over what the council is doing to mitigate the shortfall at an economy and development select committee meeting on Thursday.

“Because the world has changed since the pandemic, is our investment strategy now no longer fit for purpose in light of what we have seen and experienced?” she asked.

Cllr Phil Murphy, cabinet member for resources, said he had to offer “a very guarded answer” due to commercial sensitivity.

However he said work is going on which “looks to be coming to fruition”.

“We are in a position where we are almost certainly going to be awarding companies space, particularly in Castlegate,” he said.

Cllr Taylor asked if Cllr Murphy could provide assurance that efforts are being made to mitigate the predicted shortfall.

In response, Cllr Murphy added: “All I can tell you is that we are at an advanced stage of negotiation on several sites.”

The questions were raised during a meeting held to consider the council’s budget proposals for next year.

Cllr Paul Jordan asked about the performance of MonLife – the council’s in-house service which delivers leisure activities – and whether it is providing “an appropriate return on investment”.

In response, Cllr Murphy said leisure centre income has been hit by Covid restrictions which has impacted the service.

But he said that while it is “a problem at the moment”, investments in upgrading leisure centres across the county are expected to increase footfall and income over the longer-term.