Booming land values in Birmingham city centre could net the city council more than £300 million from selling the Digbeth wholesale markets site, it emerged last night.
Cabinet members agreed to cash in on what was described as record-breaking private sector interest in investing in Birmingham by disposing of the 21-acre Bradford Street complex.
Council leader Mike Whitby said the local authority was dealing with an "unprecedented" level of inquiries about land in and around the city centre and should seize the opportunity to relocate the markets.
Last month the council, which owns most of the city centre, said development land was selling at between £6 and £10 million an acre, and in some cases for as much as £16 million an acre.
That would value the wholesale markets site - less than 500 metres from the Bullring shopping centre - at between £126 million and £336 million, easily the most rewarding land deal ever undertaken by the council.
About £15 million from selling the land will be used to help build the new Centenary Square library.
The estimated valuation of the site would appear to vindicate Coun Whitby's insistence that as much as £39 million towards the £193 million cost of the library could easily be underwritten by the council and paid for out of land sales.
Coun Whitby (Con Harborne) told yesterday's cabinet: "I want to reassure everyone that we have a level of interest in this city which is almost unprecedented. We are focused on what is happening tomorrow and on the day afterwards."
The wholesale markets site was singled out earlier in the year by the Parkinson Report into the future development of the city centre as an ideal opportunity for a scheme of national importance - possibly something on a par with the Pompidou Centre in Paris.
However, there was a warning from Sir Albert Bore, leader of the opposition Labour group, that the timing of the wholesale markets disposal would have to be carefully timed to fit in with similar deals in Eastside.
Failure to do so would risk depressing the property market, he said.
Deputy council leader Paul Tilsley (Lib Dem Sheldon) said: "This is one of the most exciting projects that we have in the pipeline. It will give us a unique opportunity to regenerate this area."
Work is under way to find an alternative site for the wholesale markets, which opened on its present site in 1974 and is the largest of its kind anywhere in the country with a £600 million a year turnover.
The buildings will not meet new health and safety standards and are not fit for purpose, according to the council's director of regeneration, Clive Dutton.
Mr Dutton said that rather than find the substantial investment needed to modernise the markets, it would make sense to move the operation to a more easily accessible out of town site. It was almost unique to find such a substantial regeneration opportunity so close to the city centre, he added.