Mareel moves step closer

MAREEL, Shetland’s proposed cinema and music venue, took another step closer to reality on Monday with the approval of £965,000 in funding from Highlands and Islands Enterprise (HIE).

The award takes the amount of external funding secured towards the project to over £3m, following a £2.1m lottery fund grant earlier this year, and Shetland Arts director Gwilym Gibbons said the funding package was now coming together well.

HIE area manager Ann Black said the creative industries were one of the world’s fastest growing sectors and of increasing importance to the Highlands and Islands. She said: “Mareel will represent a facility for the Highlands and Islands to symbolise the unique culture of Shetland and we very much look forward to the development of the creative industries centre on our doorstep.”

A meeting of the SIC’s development committee on Thursday will decide whether the council should match HIE’s funding with a £965,000 grant of its own, from the economic development budget, towards the project.

The council reaffirmed its £5.3m commitment to Mareel in June but during summer recess councillors Jonathan Wills and Gary Robinson have continued with their efforts to halt the project, which they say the SIC cannot afford.

The spectre of state aid also reared its head after two anonymous complaints were submitted to the European Commission relating to the business plan for Mareel, which projects £378,000-worth of sales of alcohol and other drinks and snacks across the bar at the venue’s café each year, or 44 per cent of its total revenue.

But the report which will go before councillors later this week says the project has “significant merit” and claims that there is “a good argument that performances at Mareel will attract out more people who would otherwise have stayed at home”, which could have a positive impact on hotels and pubs in Lerwick.

It also outlines that the Scottish Government “will be able to robustly demonstrate to the Commission that there is no state aid issue here” following detailed examination of recent Commission decisions regarding public funding of public facilities and recommends that councillors approve the grant towards the cost of the estimated £9.3m project.

Mr Gibbons said he was unable to provide an estimate of the final price tag for Mareel but that an application for the remaining costs from the European Structural Fund has also requested that it covers any increase in the overall cost of the building.

A decision on the European funding is expected at the end of this month, while tenders to build the venue are due back in the middle of September and Mr Gibbons said he hoped Shetland Arts would be in a position to award the contract in around six weeks’ time.