BOURNEMOUTH council has insisted the £49million it spent buying a retail park was a good investment – despite the troubles of key tenant Homebase.

The DIY chain has been sold to the restructuring firm Hilco for a nominal sum thought to be £1.

It is unclear whether Hilco, which also owns HMV, will close stores.

Homebase, which has a clearance store in a former bus garage at the Mallard Road site, is the second high-profile retailer at the park to run into difficulties recently .

Last month, it emerged that Carpetright would be reducing its rent payments to the council under a company voluntary arrangement (CVA) which will mean the closure of 81 stores.

Bournemouth council borrowed money from other authorities to buy the Mallard Road site, which it used to own in the days when it was the site of Yellow Buses’ depot.

The council said it was negotiating terms with new tenants to fill an empty unit next to Aldi at the retail park. The tenant would also take the JYSK unit which is due to become vacant in late August.

Cllr Philip Broadhead, cabinet member for economic development, said: “I am confident that the council’s purchase of Mallard Road Retail Park provides a sound investment for the council.

“The successful opening of Aldi has resulted in a significant increase in visitor numbers, which has fuelled interest in future trading opportunities at the park.

“Current discussions with potential future tenants are progressing well and are expected to conclude swiftly on the two units. This will continue to ensure the retail park trades at capacity and continues to provide customers with an attractive mixed offer.”

He added: “We are aware that Wesfarmers has sold Homebase to restructuring specialist Hilco, and we are unclear at this stage of the implications, but are watching this situation with interest.

“Whilst we remain supportive of Homebase’s current trading position we are also talking to other interested parties who are keen to consider possible expansion opportunities and trade from this retail park. We will be in a position to reveal more when we have some clarity on the situation.”

Homebase also has stores at Branksome, Tower Park and Christchurch.