Cheshire East Council has agreed terms to buy the 97,000 sq ft Royal Arcade site in Crewe town centre from Redefine International for £6m, a net initial yield of 10.9%.
The L-shaped 3.8-acre site includes the Arriva bus station and 26 retail units along Queensway and Victoria Street. The scheme was formerly owned by Modus and was known as Delamere Place, and had planning permission for a retail and office development which stalled in 2009.
The decision to purchase the Royal Arcade was confirmed at a meeting of Cheshire East Council's cabinet yesterday.
Options for redeveloping part of the site, which could include additional leisure attractions, such as a new larger cinema, restaurants, a hotel, car park and a remodelled bus interchange, are now being considered.
The council will launch a public consultation in the coming weeks, with a view to appointing a development partner once uses for the site are more defined.
According to a report to the council's executive, Arriva has given notice that it intends to cease operating from the bus station when the lease expires in May 2016. Part of the council's planning for the Royal Arcade site will include finding a location for an interim bus interchange facility.
JLL advised Redefine. DTZ advised the council.
Caroline Simpson, executive director of economic growth and prosperity, said: "In recent months we've been developing a regeneration delivery framework for the town centre to understand the role that Cheshire East Council can play in giving our residents a town centre that they deserve.
"We've already secured millions of pounds of investment for the town centre through the new Lifestyle Centre and the University Technical College which will both open in 2016.
"This is the latest piece in the jigsaw and builds upon strong interest expressed through leisure operators, who share our vision for Crewe and our belief that we can forge a role for the town centre that is based on it being a destination for families to spend quality leisure time."