Ambitious plans to transform Rhyl’s Queen’s Market as part of a town centre regeneration have spiralled by more than half of the original £7.4m bill.

The development would see a market, food courts and events space take over the mostly derelict site.

But the cost of phase one of the redevelopment has risen, with Denbighshire councillor’s voting to throw another £1.5m of tax payers’ cash at the project.

The council’s Cabinet were given a report outlining how the redevelopment had seen:

£1m in increased demolition costs

£500,000 for increased asbestos removal costs

An extra £500,000 in increased costs for clearing buildings and securing vacant possession

£75,000 for clearing “contents and detritus” left by previous owner; and

£30,000 in increased survey costs to support the planning application plus other costs

The report called the development the “key site” required to deliver the “Rhyl Town Centre Master Plan”.

The study laid before cabinet showed how costs had spiralled up to £11,734,571 since the plans were first revealed – and an extra £1.5m was required to go ahead with the demolition of most of the site.

The whole project cost of the three phases in the scheme was anticipated to be around £30m but that figure will now be in doubt after the news phase one is already over budget by around 57%.

The authority was forced to dip into its finances to find the £1.5m because the time taken to source the money externally would have seen grant funding already secured against the project expire – meaning the council would have to reapply for it.

Cllr Julian Thompson-Hill told cabinet another £4.3m was needed just to get phase one of the project completed and the council would lobby Welsh Government for the remaining £2.8m required.

He added: “I think it’s fair to say Welsh Government are heavily invested in this project and they want to see it completed.

“I think we are pushing on a half open door there but there’s an expectation they would not fund the whole £4.3m – which is not unreasonable.”

Cllr Thompson-Hill said the council had been forced by Welsh Government to put all the site acquisition costs onto phase one, rather than purchasing relevant buildings at each stage.

Council leader Cllr Hugh Evans said “we all know the importance of the Queen’s market to Rhyl”, calling it a “substantial project” which, on completion would provide “a massive impact” to the town.

He added: “There’s still a shortfall, which we will have to investigate how that will be filled in due course.

“But I am comfortable to recommend this to cabinet today.

“There are further phases which will need further consideration, or even a different approach given the impact of Covid, but there’s time on our side to revisit those.”

However the council will now only go forward with phase one in the short-term and hope to get Welsh Government cash aid for the other two phases in later down the line.

Phase one of the redevelopment involves building a main market hall with six hot food kiosks showcasing local foods, 10 permanent market stalls and six temporary stalls.

Artists impressions of the potential look of the site were also shown to Cabinet.

An events space would house community functions, speciality markets, conferences and exhibitions or live performances.

A central service area with bars and toilets would link the different elements – and Queen’s Chambers on Sussex Street would be kept and restored.

Externally there would be a link with West Parade and a courtyard area.

Phases two and three of the development would see office, commercial and residential buildings spring up around the market buildings.