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The former Risca Palace cinema is set to be bought by Caerphilly County Borough Council.

The building, on Tredegar Street, currently houses a convenience store, Risca Library, and offices.

It was due to go up for auction on Wednesday July 17 but a deal was secured prior to it going under the hammer.

The council’s cabinet members held behind-closed-doors talks that same day, to discuss the potential acquisition.

Caerphilly Council already has strong links to the site, renting the library and office space at a reported cost of £107,000 annually.

On Wednesday July 24, a council spokesperson confirmed a deal had been struck for the Palace.

“The council is committed to a long-term lease of the library site, but we recently discovered that the owner of the building had decided to sell Risca Palace,” the spokesperson said.

“In order to secure our continued use of this key strategic site, the council made an offer for the property that has been accepted. 

“Contracts have been exchanged and the conveyancing process will be completed in due course.”

No other details of the sale have been released, but according to documents published by auctioneers Allsop, the guide price for the Palace – had it gone under the hammer – was £1.1m.

As the new owner, Caerphilly Council stands to make annual income from renting the retail aspect of the building.

Auction documents show the yearly rent for the convenience store section of the Palace is estimated at more than £61,000.