Decision details

The Strategic Director of Regeneration, Planning and Development authorises, under delegated authority, approved £40,000 from the Labour Market Growth and Resilience Fund to be provided to Create London to fund a transition period of 6 months (July 2017 – December 2017) to enable a new restaurant operator to be found and to continue the delivery of the social and economic outputs for Tottenham during this transition period.

Chicken Town restaurant at Tottenham Green opened in December 2015. Good progress has been made in building the business and delivering the social outputs, however customer numbers, and therefore income, have not been as high as originally projected. Chicken Town and Create are now seeking a new partner to run the restaurant businesses so that income can be increased at a quicker rate, the business can be stablilised, and the socio-economic benefits of the venture can be maximised. The new operator will continue to pursue socio-economic targets and priorities associated with the OIF loan, either directly or in partnership with Create.

Create have invested significantly in the business to date but are unable to commit any more funding to Chicken Town Ltd post June 2017. In order to ensure that the restaurant does not close and that a new restaurant partner can be found the Council is proposing to provide gap funding for this transition period during which the restaurant will continue to develop local employment and training opportunities and pursue community outreach work.

A target date of September has been set for identifying a new operating partner and agreeing a revised business plan. The business plan will address future operation and profitability of the restaurant and achievement of OIF socio economic and loan repayment targets. Milestones will be included to support effective monitoring by the OIF team.

Chicken Town Ltd received a £210,000 loan from the Opportunity Investment Fund (OIF) in 2015 which is repayable once £50,000 per annum profits (after tax) are reached. Based on the current operation the repayment of the loan is unlikely to commence in the near future. The appointment of a new commercial partner who can drive up profits at a quicker rate is an objective of the Council to ensure timely repayment of the OIF loan.

Not to award Create the funding for the transition period- This was considered as an option however this would mean the restaurant will close with immediate effect and that existing jobs will be lost, and new jobs and apprenticeships cannot be created during the transition period.

The recommended scenario of providing £40k transition funding supports continuity and the continuing delivery of social and economic development outcomes, while at the same time maximising the opportunity for a new commercial restaurant operator to be found who can drive up profits and ensure the future success of the restaurant at Tottenham Green.