SHETLAND Islands Council is understood to be in negotiations to take over Shetland Leasing and Property Development Limited (SLAP), which owns buildings such as the 8 North Ness council headquarters, Shetland College and Scatsta Airport.
Twenty of Shetland's 22 councillors met behind closed doors at Lerwick Town Hall last week to discuss at length a "property matter", but members remained silent on what the issue was.
The "matter" is now understood to include the sale of SLAP, which is owned by Shetland Charitable Trust, and its assets.
On Monday, council chief executive Maggie Sandison neither denied nor confirmed that these talks are taking place.
In a short statement made to Shetland News the chief executive said: "The council and I as the head of the council cannot have a conversation about the matter at present, because it relates to the financial business affairs of another organisation other than the council.
"We are also not able to discuss expenditure in relation to a contract or a purchase when that that is current information and similarly we would never discuss in public a negotiation that is currently ongoing.
"I am not saying that the council will not be able to speak about this in due course but at this precise moment I am not able to confirm or deny the questions that you are asking about what that report was about."
SLAP owns a wide range of property and land, including the council headquarters at 8 North Ness and the land around Staney Hill earmarked for housing development, as well as Shetland College, the Solar Hus, parts of the NAFC Marine Centre and Scatsta Airport.
With a portfolio valued at between £20 and £23 million, SLAP earns between £2 and £3 million annually through leases to commercial companies and the local authority.
The surplus generated is being paid through the gift aid mechanism to the charitable trust thereby avoiding any corporation tax on the profits.
While it is somewhat unclear as to why SLAP has agreed to enter into the negotiations, the council could save money in the long-term as it will avoid having to pay rent on properties such as 8 North Ness, Shetland College and the NAFC Marine Centre.
The charitable trust would not comment on the talks, and SLAP chairman Michael Thomson is on holiday until next week and could not be contacted.