A new facility aiming to keep tech start-ups in the city has taken a significant step forward - but will require extra cash.

City Hall is looking to create a new workspace for digital businesses by renovating its Townshend House building, once home to the regional HQ of ITV. 

Now, Norwich City Council is looking to award the contract for refurbishing the facility, which it is branding a “Digital Hub”.  

However, the cost of the plan has now risen beyond the initial £2.78m estimate, to £3.18m, meaning City Hall is looking for additional funding.

The scheme aims to provide around 23,0000sq ft of office space, with room for between 10 to 25 companies and around 200 jobs. 

It is one of the Labour-led authority's eight ‘Town Deal’ projects, which saw £25m investment from central government.

Other projects funded in the deal include refurbishments of St Andrew's Hall and a new engineering centre for City College.

Alan Waters, the leader of Norwich City Council, said there have been challenges in terms of construction costs, supply chain difficulties and inflation. 

Eastern Daily Press: Alan Waters, leader of Norwich City CouncilAlan Waters, leader of Norwich City Council (Image: Archant)

Speaking at a cabinet meeting on Wednesday, he said: “We need some additional funding for the Digital Hub at Townshend House.

"So we’re going to 'de-prioritise' one of the public realm projects, which is Upper St Giles. 

“The Digital Hub project is crucial in terms of moving things forward around the sector, a good business space it keeps our tech start-ups in the city rather than having to go elsewhere.”  

The plans for Upper St Giles involved widening the pavements to create more space for pedestrians and outdoor dining, a new pedestrian crossing and extra trees were also being examined.

Transferring the money from one Town Deal project to another will require approval from the government.

Cabinet agreed to award the contract subject to being able to move the money.