HOMEBASE at Bournemouth’s Mallard Road Retail Park is closing, leaving a massive hole in the council-owned site.

The company is quitting the premises after failing to reach agreement to reduce the rent bill of nearly £1million a year.

BCP council says it is finalising a deal to let the listed building, a former bus garage, to another operator.

The former Bournemouth council bought the Mallard Road Retail park, which it once owned as a Yellow Buses depot, for £49m in 2017.

For the past year Homebase has been paying reduced rent of £92,000 under the terms of a company voluntary agreement (CVA).

The CVA was proposed in August last year due to fragile trading at the chain and the rent on the Bournemouth site was due to be negotiated on July 1.

It is understood that Homebase decided to close the store after failing to agree a rent reduction with the council.

There are large “closing down” signs at the shop and it is understood that it will close in September with the loss of a number of jobs.

Cllr David Brown, BCP Council’s cabinet member for finance, said in a statement: “Cabinet on February 20 approved the terms of a new lease for the whole of Unit 1, the unit occupied by Homebase currently, and gave authority to terminate the current agreement with Homebase.

“That termination has not yet been served and under the terms of the lease, there is no provision for either the council or Homebase to do so until November this year.

“Whilst we have not received any formal notification of Homebase’s intention to break their lease, it is not unexpected given the cabinet decision.

“However, it is disappointing that Homebase appear to be preparing to close this store earlier than necessary when several further months of trading from the unit are possible.

“In the meantime, we are finalising terms for the letting of the whole of the unit to another operator, although we cannot comment further on this matter due to commercial sensitivity.”

Bournemouth council’s purchase of the Mallard Road Retail Park, with money borrowed from other councils, was expected to bring in £2.5m a year in rent.

But the Daily Echo revealed earlier this year that the financial troubles of Homebase and Carpetright had reduced that income to £1.5m. Homebase was paying only 10 per cent of its £920,000 rent, while Carpetright was paying 50 per cent of its rent.

Homebase occupies a 1950s building which was originally a Yellow Buses garage and bus wash. It was made a grade two listed building because it boasts the largest single-span concrete roof in Europe.

Earlier this year, BCP Council granted itself planning permission to turn the current store into two smaller units. The council said it would make the retail park more attractive to tenants.