A council will call on private developers to help deliver a 10,000-home ‘garden town’ amid fears over cash flow.

But leader of Folkestone and Hythe District Council said it won’t rely on "Joe Schmo and his brother” to deliver Otterpool Park.

The district council revealed the £119m originally earmarked to build the new town and its associated infrastructure is now insufficient.

Council officers are pointing the finger at volatile economic conditions bringing new financial pressures in delivering the sprawling site, set to be bigger than nearby Hythe.

The first 8,500 homes at the former Folkestone Racecourse site near Sellindge were approved by the district council’s planning committee in April.

Up to seven primary and two secondary schools are proposed to be built under the plans, alongside a town centre, shops, health centres and places of worship.

In the works for more than 10 years, the plans have attracted stiff opposition, and outline planning permission was only granted by seven votes to five.

At a meeting of FHDC’s overview & scrutiny committee on September 26 at Folkestone’s civic centre, councillors were updated on the project’s finances.

“The increase in borrowing rates, the inflationary pressures, have had a significant impact on not just Otterpool but the development industry as a whole,” a senior council officer said.

“Having been through this as a finance team, and in particular our chief financial officer, it’s very clear now as officers, our proposition to our members is that the original funding proposal is not now considered to be affordable.”

The agreed funding for Otterpool Park is up to £119m, and the spend so far is £63m, with the land acquisition alone costing £44m, according to council papers.

Otterpool Park LLP, the company slated to run the development, is wholly owned and funded by the local authority.

The firm has previously requested the council make an extra £80m of borrowing available for the project, which is yet to be decided.

“Something has to change, the status quo cannot now be maintained and therefore the financing structure that the LLP is currently working under is going to have to change,” the officer continued during Tuesday’s overview and scrutiny meeting.

“The overall proposition at Otterpool of course remains sound, it’s an integral part of our local plan,” he added.

Chief executive of the council Dr Susan Priest told members: “It presents a really high level of risk for the council to be the sole funder and sole master developer for the whole site.

“So to seek a partner that has some track record of delivering development at scale will, I think, help to mitigate the risk profile.

“When looking at the scale and quantum of what’s required that’s what’s brought us as officers to the conclusion that we really do need to have a co-investor because this is a big deal for a district council.”

Council leader Jim Martin (Green) told the committee: “The reality is I don’t think there’s anything we can do to Otterpool that will make it unprofitable in the very long term.

“The difficulty that we will have is that cashflow.

“We don’t have the money to service the Otteprool model at the moment and that’s what we’re hoping the potential strategic joint venture partner will bring.”

Vice-chairman of the committee Cllr John Wing (Green) said: “There’s very few people or firms in the country which could handle a project of this size even if it is half of it, I think we must be careful.”

However, Cllr Martin reassured members “the strategic partner that we will consider will be at the highest level, it’s not going to be Joe Schmo and his brother.

“You won’t be disappointed.”

In October FHDC’s cabinet is set to agree to search for a partner in delivering the development, in a process which could take upwards of nine months according to the chief executive.

The report will also recommend the council for a Task and Finish group to scrutinise decisions relating to the development going forward.