Hotel development valued at £70m less than it cost one year after opening

A hotel and conference centre in Birmingham has been valued at £70m less than it cost to build just a year after it opened.

The development by the union Unite on Birmingham Science Park Aston has a controversial history since the contract was awarded to Liverpool construction company Flanagan Group, which had not previously built something of this scale.

Unite spent £98m as costs spiralled but its new general secretary, Sharon Graham, had ordered an inquiry and has now been told two separate valuations have been given of £27m and £29m.

Graham ordered an independent inquiry into the investment after taking over, led by a QC. It is expected to give an update by the end of March.

Former general secretary Len McCluskey has previously defended the spending as a “sensible investment of members’ money, resulting in a world-class facility that will return an income for our union for generations to come”.

Unite would not comment on the most recent valuations after the general secretary said in December that “we will not be giving out any further details that may prejudice that investigation”.

She added: “A recent expert valuation has now estimated its value as being considerably lower than the costs incurred in developing the site.

“This represents a potentially significant loss to Unite and has to be investigated. I will also be doing everything possible to recover all monies due back to the union.”