The restaurant closed earlier this year after receiving a £750,000 grant from Hull City Council though it is set to reopen with a ‘brand new’ offering
The opposition Labour Group in Hull City Council have called for a “full investigation” into how Iron Lilies was awarded £750,000 by the council, only to close less than a year later. The botanical garden-themed restaurant in Princes Quay closed its doors in July despite having received the significant grant.
Tokyo Industries, which runs Iron Lilies as well as being the operator behind the shopping centre itself, said it was a “tough decision” to close the venue. However, it crucially added: “We are excited to announce that we are looking to re-open the premises later in the year with a brand new and far more appealing offering for our guests.”
The restaurant was given a maximum grant of £750,000 from the Liberal Democrat-run council in the form of a Levelling Up Funds (LUF) which aim to help bring unoccupied units back into use. Prior to the restaurant opening, the floor space had been empty for ten years having previously been home to Virgin Megastore and, later, a gym.
A Hull City Council ‘Levelling Up Grants Update’ document from October 2025 states: “Within the LUF grant agreement there is a standard clawback clause which outlines the mechanism to clawback the grant which tapers down over a period of four years, should the grant funded building be sold or the lease terminated within four years. As there is a commitment from Tokyo Industries to reopen the premises, the clawback mechanism has been temporarily paused and will restart once the premises reopen.”
The document also states: “The LUF grants team have a monthly check in with Tokyo Industries to ensure that their plan to reopen is on track. The latest check in early October included a visit to the premises.”
The council’s Labour Group, which has described the situation as a “scandal”, is calling for full disclosure of the actions around the awarding of the grant which aimed to reopen unused buildings and create local jobs. As Iron Lilies remains closed, the 35 jobs it created have, for now, been lost.
The Labour Group’s Deputy Leader, Councillor Sharon Hofman, said: “The council chases individuals who fail to pay the rent or council tax immediately, but when £750,000 appears to have been wasted, they remain silent. It is not good enough for the Liberal Democrat council to just sit back and do nothing after handing over £750,000 while the development then shuts down.
“This funding is supposed to help kick-start regeneration in tired city centres, attract new, permanent jobs and boost the local economy. That appears not to have happened in this case and questions must be answered.
“The Liberal Democrats may think this issue is going to go away. It is not. We simply cannot waste money like this, especially while other local businesses are struggling, or actually going to the wall.”
In response to the Labour Group’s calls for an investigation, a Liberal Democrats spokesperson said: “It is shameful to see Labour politicians continually point score when their own national income tax hikes have clobbered business, not just across the city but across the country. The Council are actively working with Iron Lilies to help support their business for a re-opening, the option to claw back funding is still possible and ensures no taxpayer cash can go to waste.”
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