A developer’s offer of £120,000 for the removal of a covenant restricting development on the former village square site in Westward Ho! has been rejected.

Torridge District Council (TDC) sold the site to Westward Living back in 2014, with a clause in the contract that meant the land could only be used to build a hotel, as well as commercial use on the ground floor.

But Westward Living’s Alan Smith told Monday’s community and resources committee that unless the size of the hotel could be increased, it was not viable for one to be built.

The site is currently being used as an open bar with outdoor seating.

Mr Smith had offered the council a set fee of £120,000 to remove the covenant that restricted development, but councillors voted by six votes to four to reject the offer.

A 2016 artists impression of what a hotel at the site would look like.A 2016 artists impression of what a hotel at the site would look like.

Putting forward his proposal, Mr Smith said: “The planning permission for a hotel is not welcome by local residents or local councillors. This is an important site and it is too small for a hotel and unless the size is increased, it is not viable.

“An alternative use is needed but cannot be found as the site is tied to the covenant. I have made an extremely high offer to remove the covenant and allow any owner to offer alternative uses, which will be subject to planning permission.

“The council will receive a capital sum of £120,000 for the loss of no asset. This would surely be welcome and if this is refused, would like a reason to be given.”

Staci Dorey, the council’s monitoring officer, told the committee that when TDC sold the site in 2014, part of the agreement was that a restrictive covenant restricted the use to the building of a hotel.

She said: “They cannot build anything other than a hotel without coming to us to remove or vary the covenant. They have asked to remove it and offered £120,000 for removal. The offer made by the landowner to release the covenants is in line with the valuation advice received and the price is acceptable.”

She added that the open bar that was currently in operation on the site, and which had received planning permission, was technically a breach of the covenant and that without further action by the council around this, continued operational use could invalidate the existing restrictive covenant.

Cllr Peter Christie said that the whole point of selling the site in the first place was for a hotel that Westward Ho! needed.

He added: “It will be a block of flats that goes there as I can’t think what else it would be. A prime site and if it is sold for £120,000, that doesn’t seem much to me, so we need to explore the idea of overage.”

Cllr Anna Dart added: “We need to know the proposals. It is mind-boggling that we can know what the uplift value is unless we know what it is uplifting to. It is crucial that we don’t get apartments there as people in Westward Ho! were up in arms about it.”

But Mrs Dorey said that Torridge could not request an overage clause as they no longer own the site. She added: “The only control we have is the restrictive covenant to not allow anything other than the hotel. I don’t know why it is not going ahead, but the landowner has said it is not viable and not going ahead.”

Cllr Richard Wiseman called for the committee to accept the offer. He said: “We don’t have any other covenants like this for any other land. If they put in a planning application, then they will have to go through planning and jump through all the hoops there. I would like to see the site progressing as at the moment sits out like a sore thumb. The Only issue is, ‘is this a fair valuation?’, and I think it is, so we should move forward with this.”

Cllr Dermot McGeough, vice-chairman of the committee, added: “This gives us some money back that we need. It is a fair price and it is like we are holding him prisoner. This is a fair price that he has offered the council.”

Cllr Doug Bushby added: “I don’t see us doing anything to enforce the use of the site as the bar now anyway, so the £120,000, we can accept that and then rely on the planning committee to do the right thing for the people of Westward Ho!.”

But when it came to the vote, councillors rejected the offer, with four in favour of it and six against,