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National
Daniel Holland

Gateshead Quayside arena in need of £20m Levelling Up boost as construction costs escalate

A new arena and conference centre that will transform the Gateshead Quayside is in need of an extra £20m to cover escalating costs.

Council bosses are launching a second Levelling Up bid to the Government to secure new investment for the huge complex, having been rejected for funding last year. It is hoped that the centre, which will be called The Sage, will create 2,000 jobs and attract an extra million visitors to the North East once it opens in 2024.

The development will feature a 12,500-capacity arena that will replace the Utilita Arena, a conference centre, and a hotel – plus new bars, restaurants, public space and walkways along the Quayside. But construction of the venue, the price of which has previously been put at £300m, has been hit by rising costs as a result of factors including the Covid-19 pandemic and the war in Ukraine.

Read More: Quayside residents fear new arena's hotel will leave their homes feeling like 'Victorian prison'

The council said that the arena plans were made “before global events rocked the supply chain, throwing costing uncertainty into the mix and putting financial pressures on the development”. It is understood that the building of the arena will go ahead whether or not the £20m Levelling Up bid is successful, but designers could be forced to remove some elements “adding additional value to the surrounding area” without the extra cash boost.

The deadline for this second round of bids to the £4.8bn Levelling Up Fund has been pushed back from its original July 6 date, after councils seeking to submit applications were left unable to access its web portal more than a month after it had been due to go live. A £20m bid for the Quayside Arena was among the schemes turned down when Chancellor Rishi Sunak revealed the first winners last October, among which were a new leisure centre in Newcastle’s outer west and a restoration of the Grainger Market.

Announcing their second bid, which has been backed by local MPs and other major North East bodies, Gateshead Council said: “The scheme like all aspects of life has been impacted by the rising costs, if secured the levelling up funding will help combat the rising costs freeing resources which will allow for the investment in planned elements required for adding additional value to the surrounding area. The scheme, whilst being delivered by Gateshead Council, will be of significant economic benefit to the North East as a whole.

“Having an international grade conference centre and arena on the Quayside will be transformative for the region; additionally, it will also provide a park and benefit from links to the council’s district heating network and heat from minewater scheme. It will also promote local businesses and become one of the region’s tourism hot spots.”

Sage PLC has bought the naming rights for the new complex, which is being developed by Ask:PATRIZIA and will be operated by ASM Global, meaning the existing Sage Gateshead music centre next door is set for a name change.

Sarah Green, chief executive of the NewcastleGateshead Initiative, called the arena a “game-changer”. She added: “The development will act as a catalyst to the meetings and events industry, enabling us to attract larger international conferences and will put the North East of England on the map as a unique and distinctive place to visit and hold world-leading events.”

Peter Udall, the council’s strategic director of economy, innovation and growth, said: “A successful Levelling Up bid, and the funding this would release from Government, is key to providing opportunities for our residents. Our bid more than fulfils Government’s brief for levelling up and would support the Council’s aims to improve the quality of life for local people, supporting them to thrive.

“It will increase a sense of pride in the area as well as regional employment opportunities.”

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