The S151 Officer and Corporate Director Communities submitted a report, the purpose of which was:

 

a.    To obtain approval from Council for a revised capital programme for 2017-18 to 2026-2027

b.    Advise Members that a report was submitted to Cabinet on 19^th December 2017 which:

 

(i)                Updated Cabinet on the Porthcawl Regeneration Scheme 

(ii)     advised that a proposal has been received from the Evans’  families, to sell to the     Council their leasehold interest in Phase 1 – land at Salt Lake Car Park;

(iii)    presented the terms of this proposal, and set out the consequential impact on the remainder of the Porthcawl Regeneration Scheme;

(iv)  advised Members of the ‘due diligence’ that has been undertaken to date, and the further measures which will be put in place to protect the public interest; recommended that the offer be accepted.

 

At its meeting on 19th December 2017, Cabinet authorised the Corporate Director - Communities, in consultation with the S151 Officer and the Monitoring Officer to:

 

(a)  Acquire the Evans’ families head lease and sub-lease interests in Salt Lake Car Park Porthcawl, at the price of £3,330,000 and terms set out in Appendix 1 of this report;

 

(b)  Vary the existing Owners Agreement dated 11th March 2011 between the Council and the Evans families, on the terms outlined in paragraph 4.11 of the report. 

 

The report gave some background information, by confirming that in 2006, the owners of development land in Porthcawl agreed to work jointly, by bringing together the freehold and leasehold interests which overlay substantial land holdings within the town. The aim was to bring forward the land for sale, providing the owners with sale receipts to be split on a pre-agreed basis subject to minimum prices being achieved; and to deliver a clear planning context for disposal of sites for third party development.

 

In November 2007, the Porthcawl Regeneration Supplementary Planning Guidance (SPG) was adopted by the Council. This provided for new homes within the overall area plus major retail and leisure developments, community provision, new road systems, land set aside for health provision, and other areas of public amenity, including new sea defenses along Eastern Promenade and the Sandy Bay frontage.

 

The overall development area was divided into two phases of which:

 

·          Phase One included Hillsborough car park, The Green and Salt Lake car park

·          Phase Two comprised the Coney Beach Amusement Park and the former Sandy Bay caravan park.

 

The report then gave some information of the disposal history of the land, and that in 2014, following the failure of the sale of the site to Morrisons (and bids for sale of the site in 2010 to Tesco / Chelverton), various offers were made to acquire the Council’s interest. These were turned down as there was no market exposure (in terms of securing best consideration) and the nature of the offer did not meet either the minimum price requirement or the regeneration objectives of the Council.

 

The Corporate Director Communities then added that in 2015 the parties agreed to review the development proposals in light of the large scale food retailers retreat from the market. A new Master Plan was commissioned to support the existing Supplementary Planning Guidance.  However, the owners could not agree the final makeup of the overall development proposals.

 

In 2016 discussions on the Master Plan floundered, and the Evans’ subsequently proposed that the Council consider purchasing their leasehold interest within Phase 1.

 

In terms of necessary expenditure, within the terms of the OA the Council agreed to fund “necessary expenditure” such as planning costs, in order to enable the development scheme to proceed. This was on the basis that it would be reimbursed from the capital receipts generated from land sales. No receipts have yet been generated. Within the terms of the Owners Agreement the Evans’ are required to reimburse the Council on the 5th anniversary of the expenditure, commencing on the date of the Owners Agreement. No payment has yet been received on this and related commercial matters had also yet to be agreed.

 

The Corporate Director Communities then explained that paragraph 4.6 of the report onwards, detailed the pluses and minuses relating to the acquisition of the Evans’ interest, and that their leasehold interest in the land had to be carefully considered, in that the Authority had to be sure that any deal it was pursuing was a ‘value for money’ option.

 

A preliminary valuation was undertaken by an independent Property Agent, in order to establish the price range within which the Council could consider acquisition, and from this, a provisional offer was made by the Council in September 2017, with a short expiry date, and terms had now been provisionally agreed to acquire the Evans’ interest on the heads of terms detailed in Appendix 1 to the report.

 

The next part of the report outlined proposed variations to the Owners Agreement, and some changes to these were contained in paragraph 4.11 of the report, whilst paragraph 4.12 related to due diligence where the Corporate Director Communities explained that the Council had taken steps to enter into this thoroughly and comprehensively, in order to ensure that it was obtaining value for money.

 

The Corporate Director Communities then referred to paragraph 4.13 of the report and risks and associated issues to the proposal, adding that any commercial investment of this scale had an element of risk attached to it, though it was felt that the benefits for the further generation of Porthcawl outweighed these.

 

He finally concluded his submission, by sharing with Council the report’s financial implications with regard to the proposal.

 

The Leader and Cabinet Members in turn commended the report, and the Leader added that this was a significant investment for the area of Porthcawl that would emanate from a Capital Receipt. He added that there weren’t too many other areas within the County Borough that had the capacity to fulfill what was proposed in this location at Porthcawl in terms of a development of this size and magnitude.

 

A Member raised some concerns regarding the cost of the Scheme in terms of the level of investment being committed to it, together with the fact that a considerable number of fringe costs regarding the works to be undertaken, had not been included in the report. He also queried the extent of what the Evans’ would gain financially from the deal, and the economic prospects for growth, when compared to the substantial financial commitment that the Council were contributing towards the proposal. He felt also that the report was untimely given the current financial restraints, and at a time when BCBC were about to increase Council Tax rates throughout the County Borough. He also raised some concern regarding what constituents in other areas of the County Borough would think about this level of monies being contributed to invest in Porthcawl, particularly those residents who lives in some of the more deprived areas of the Borough.

 

The Corporate Director Communities whilst recognising some of these concerns, advised that issues such as those raised by the Member had been fully considered, as well as specialist advice having been received from a Property Agent and 2 independent valuers appointed to consider and provide advice on the market value of the land. This opportunity also had to be taken now he added, as this would not be available in the future. He felt therefore overall, that the proposal was a very reasonable and proportionate investment opportunity, that the Council could not really refuse to ignore.

 

The Members of the area of Porthcawl, together with other Members welcomed the report, adding that the proposal would give the Council a unique opportunity also to generate employment for young people throughout the County Borough.

 

The Leader concluded debate on the item, by advising that if the recommendations of the report before Members were overturned, then this would result in the regeneration of the biggest brownfield site situate within the County Borough not being developed upon. He felt therefore that there was a compelling case for the local authority contributing to this investment.

 

Members then agreed to have an electronic vote on whether or not there should be a recorded vote undertaken on the recommendations of the report.

 

The result of this was as follows:-

 

For                                    Against                         Abstain

 

44                                           1                                   1

 

Therefore, a recorded vote was then carried out on the recommendation of the report, the outcome of which was:

 

For                                   Against                          Abstain

 

Cllr G Thomas                       0                                Cllr T Beedle

Cllr JH Tildesley                                                      Cllr DK Edwards

Cllr DBF White                                                        Cllr R Penhale-Thomas

Cllr N Burnett                                                          Cllr E Venables

Cllr P Davies

Cllr J Gebbie                                                                4

Cllr R Granville

Cllr S Baldwin

Cllr J Radcliffe

Cllr T Thomas

Cllr K Watts

Cllr A Williams

Cllr J Williams

Cllr R Shaw

Cllr B Sedgebeer

Cllr JP Blundell

Cllr M Jones

Cllr M Clarke

Cllr R Stirman

Cllr AJ Williams

Cllr A Pucella

Cllr L Walters

Cllr S Vidal

Cllr K Rowlands

Cllr A Hussain

Cllr JR McCarthy

Cllr M Kearn

Cllr D Lewis

Cllr JE Lewis

Cllr JC Spanswick

Cllr N Clarke

Cllr CA Green

Cllr S Aspey

Cllr C Webster

Cllr T Giffard

Cllr MC Voisey

Cllr PJ White

Cllr D Patel

Cllr HJ David

Cllr HM Williams

Cllr CE Smith

Cllr RE Young

Cllr P Davies

 

43

 

The vote for the recommendation was therefore carried.

 

RESOLVED:                  That Council approved the revised Capital Programme, as set out in Appendix 2 of the report.