A developer says stumping up £60k it pledged to a council - which approved its plans to build a block of flats - is now “unaffordable”.

Gillcrest Homes agreed to shell out the section 106 money to Canterbury City Council when it green-lit plans for a major residential city centre redevelopment in 2019.

The funding is given to provide facilities to a community following a development in the area.

But Gillcrest told the authority costs for the 24 flats in the old Stour Street tannery spiralled to £9.25 million, more than £385,000 per home.

The Rochester developer, which completed the project in 2021 and currently rents out units, recently made its case in official council papers, in a bid to pay just £1,296.

Bosses argued they had “demonstrated that the site, if developed in the current economic climate, would be unviable and that the contributions agreed to are unaffordable”.

They point the finger at a raft of unforeseen expenses; protecting the heavily contaminated building’s facade and surroundings, and the cost-of-living crisis hiking building material prices.

Gillcrest’s current projections show it will be £100k in the red if unable to convince the council to let it off paying the vast majority of the allocated funds.

When first agreed, a transport contribution of £31k was set aside for pedestrian access improvements where Rheims Way meets the Great Stour, including new paths and an access ramp.

Another £32k was pledged as part of an open space contribution – specifically for the improvement of Dane John Gardens.

In papers submitted to the city council, the developer says open space improvements have already been paid for by central government thanks to the Levelling Up bid – meaning it should not have to pay out.

It also claims the footpaths in this vicinity are in good repair and are generally level there the requirement to improve them is not required.

However, the group said it will still pay the £1,296 it promised as part of a library contribution, which would be used to pay for new books.

When approached by KentOnline, bosses at the firm refused to comment but referred to the papers it submitted to the council as it looks to alter the agreement.

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Originally set to be transformed into a 40-bed luxury hotel by Hotel Du Vin 16 years ago, the site was long-empty before Gillcrest arrived on the scene – having shut as a working tannery in 2002.

The closure of the site marked the end of more than 200 years of tanning and leather work within the city walls.

The Merchants Row and Squire Lofts properties offer a range of two-bed to four-bed properties within the city walls a five-minute walk from the High Street.

Planning obligations, also known as Section 106 agreements (based on that section of The 1990 Town & Country Planning Act) are private agreements made between local authorities and developers and can be attached to a planning permission to make acceptable development which would otherwise be unacceptable in planning terms.