Decision details

RESOLVED:

That authority was given to the Assistant Director of Assets & Environment to:

1.    Transfer the assets listed within Appendix A to the relevant parish councils on the basis set out in the report.

2.    Consider, in consultation with the Finance Portfolio Holder and the Environment, Transport, Highways and Waste Portfolio Holder, any objections to disposals of open space following publication of the intention to dispose required by Section 123(2A) of the Local Government Act 1972 and either proceed with each affected disposal or cease that disposal.

3.    Offer the freehold of each shop listed in Appendix B for transfer to the current tenant at the price established by a current Red Book valuation commissioned by the Council from an independent consultant, and if that offer is accepted to proceed with the disposal. Any disposal is to contain a restrictive covenant (or similar) to ensure that the ground floor of each property currently used for retail remains in commercial use.

4.    Following the completion of a ‘best and final’ offer process, negotiate and agree terms for a lease and agreement for lease for a battery energy storage facility (BESF) on the Council’s land at Booth Meadow, Northampton as set out in the report, and enter into any documentation required to implement this.

5.    In consultation with the Finance Portfolio Holder agree terms for the disposal of land off the A45 London Road, Daventry as set out in the report, and enter into any documentation required to implement this.

6.    Dispose off-market the land off Warwick Street, Daventry as set out in the report.

It is further recommended that:

1.    It is noted that investment would be required to replace the income provided by the estate shops in accordance with budget item 2223-B6-019.

2.    The Assistant Director Assets & Environment was authorised, in consultation with the Executive Director Finance, Director of Legal and Democratic and Monitoring Officer, and the Finance Portfolio Holder, to authorise and agree terms for lettings for BESFs similar to those proposed for Booth Meadow, and that the Constitution be amended accordingly.

3.    Cabinet acknowledged the competitive bidding process for the land off the A45 London Road, Daventry that has been undertaken by the other landowners is suitable to achieve best consideration from the disposal.

REASONS RESOLVED:

Overview

1.    It was sensible for the Council to review its estate and ensure it delivers the best overall value, taking policy and financial considerations together, to the residents of West Northamptonshire. Parish council transfers

2.    The Council had received several requests from parish councils to transfer various parcels of public open space useful to their local communities from the Council to them.

3.    It was considered that such assets are of purely local benefit and as such are better managed by those closer to them.

4.    Strategic interests would be protected by the Council having retain rights to re-acquire land or rights over land for £1 if it was required for infrastructure or if the parish council wished to dispose of it.

5.    As these transfers were proposed to be for the sum of £1, the disposals would be at less than best consideration. This is justified by the community benefits from local control and management of the sites, which would be protected by restrictions on future use. Northampton Estate shops,

6.    To meet the Council’s obligation not to dispose of freeholds at less than the best consideration reasonably obtainable.

7.    Whilst respecting number 6, to maximise the opportunity for existing tenants to purchase shops they currently operate.

8.    Sought to protect the commercial function of these shops given its importance to the local communities they serve. Booth Meadow Proposed BESF and other Potential BESFs

9.    Secured the best financial return for the Council from the Booth Meadow BESF proposal.

10.To maximise the opportunity to secure BESF at other locations within the Councils portfolio.

11.To maximise the opportunity for the delivery of a BESF at Booth Meadow and in other locations, in the interests of sustainability, carbon reduction, and removing barriers to development from constraints in electricity supply. Land off A45 London Road, Daventry

12.The land was surplus to requirements and was being held with longer term development aspirations in mind. The site had been actively marketed jointly with the other associated landowners. The disposal would fulfil the objectives of good estate management.

13.The redevelopment of the Site would see a key strategic area of Daventry developed which would align with the proposed West Northamptonshire Spatial Vision, Strategic Plan Objective 13: Economic Advantage.

14.To generate a capital receipt for the Council in the short term, which would be difficult to obtain if it were not included as part of the larger development opportunity.

15.To comply with the obligations on the Council to obtain the best consideration reasonably obtainable in a freehold land disposal. Land off Warwick Street, Daventry

16.The land is no longer required by the Council and its disposal would fulfil the objectives for which it was originally acquired and held. The disposal would fulfil the objectives of good estate management, and provide a means for the land to be put to beneficial use

17.To generate a capital receipt in the short term.

18.To comply with the obligation on the Council to obtain the best consideration reasonably obtainable in a freehold land disposal.

19.To support the strategy set out in the Daventry Town Centre Vision 2035.

ALTERNATIVE OPTIONS.

The Council has the following options.

Parish council transfers

1.    Retain the land. This is clearly possible, but would not offer the opportunity to increase community ownership and control, with the benefits this brings.

2.    Dispose of the land without controls. This is also possible, and should secure the community benefits sought. It may, however, lead to the loss of open space and other community assets. It may also prevent WNC from securing the interests of West Northamptonshire more widely.

3.    Dispose of the land with the proposed controls. This appears to achieve the best overall mix of benefits, whilst mitigating the risks involved.

Northampton estate shops

1.    Retain the properties. No further specific actions would be required. This would doubtless cause some dissatisfaction from the tenants. It would also be contrary to the expectations of the 2022-23 budget.

2.    Dispose of the properties to existing tenants at whatever prices can be achieved. This may well involve disposals at under value. These may not be achievable in light of the Council’s legal obligations (see legal implications) and would seem hard to justify. Other tenants would not receive similar benefits, and other retailers would not receive any benefit. The Council’s taxpayers would have, in effect, have subsidised a few private individuals.

3.    Disposal of the properties on the open market. This would maximise the chance of quick and market value disposals. However, it would decrease the chances of consolidating ownership and occupation.

4.    Disposal of properties to current tenants at market values. This is the proposed course of action and appears to best balance the desire to offer existing tenants the chance to invest in their own businesses with the Council’s duties to its wider residents.

5.    The Council also has choices about what to do with the disposal receipt. The decision expected by the budget is that the receipts would be ring-fenced for re-investment to secure an alternative income. The other option would, clearly, be to not do that, but (for example) to reduce future capital borrowing requirements. Given the budget position and the benefit from income generation ring-fencing is recommended.

Booth Meadow proposed battery energy storage facility

1.    Do nothing. The land could continue to be used for storage of school mobile classroom and other ancillary items. While the land has historically been well utilised for this purpose, the need has significantly reduced and as such this is unlikely to be required. The Council would not also receive any income from the site and would retain the maintenance obligations.

2.    Apply for planning permission for conventional development and seek to sell the land with the benefit of a permission. This is something that has been considered in the past. However conventional development is difficult in this location. In addition, development of part is likely to be complicated because of the other occupiers of the site.

3.    Apply for planning permission and electricity network access for a BES facility itself. Whilst this is theoretically possible the Council does not have expertise in this area, and would need to choose to make the investments required if a return was to be obtained. This approach may therefore delay or prevent a beneficial use being made of the land.

4.    Select one of the operators to pursue the necessary permissions and if successful build and operate a BES facility. This option should deliver the facility relatively quickly and with minimal requirement for Council engagement.

·         There are sub-options for option 4 relating to the way the operator is selected. However, it is considered that the approach identified above is most likely to result in the best financial return to the Council.

·         The area of land that is proposed to be used at Booth Meadow House is currently undeveloped grass land utilised for the storage of surplus school mobile classrooms and other associated items. Demand for this use is low. Other than the storage use, the proposed BSEF should not have any impact on the other users of the site. While the proposal may restrict the continued use of the site for storage, and the Council could decide not to enter into any agreement on that basis, the benefits derived through the rental income are considered to outweigh loss of provision.

·         By approving option 4 in the report the Council should be able to generate a significant level of income from an area of the Booth Meadow House site that is currently a maintenance liability. Such an approach would therefore support the effective use of the Council’s assets, maximising the value of its assets and support the creation of a sustainable and stable electrical network.

Other potential BESF sites

·         As outlined above, the surplus capacity available at any given sub-station is allocated on a first come first served basis. These may well be in areas where there are multiple landowners and therefore competitors to host a BESF. To maximise these opportunities, the Council needs to be able to react swiftly to future requests and ensure that it is in a position to commit to proposals quickly so as not to lose out to proposed schemes on land owned by others. The recommendations as set out in this report would support this.

Land off A45 London Road, Daventry

1.    Do nothing at this time – At present the Council’s land offers little benefit either from a financial or economic perspective to the Council. It is currently held on a tenancy at will to an adjoining landowner (one of the other landowners in the consortium) at a peppercorn fee for storage. Therefore, its future even for this use is limited should development proceed.

2.    Agree to the proposed disposal – If the Council’s interest was included as part of the larger development, its disposal would assist in the realisation of a capital receipt likely to be more than what could be realised if the land was disposed in isolation. In addition to obtaining a significant capital receipt the inclusion of the Council’s land would assist and facilitate the development of one of strategic sites in area which would align with one of the objectives of the Council as set out in the Settlements & Countryside Local Plan. The development would also result in inward investment, job creation and economic growth.

3.    It is therefore concluded that proceeding with a disposal alongside the landowner consortium (option 2) represents the best option for the Council.

Land off Warwick Street, Daventry

1.    Do nothing. The Council could continue to hold the site within its asset base in its current use. However, this offers no amenity value to the town centre or the Council’s objectives and would be a continuing management liability. Furthermore, this approach would be contrary to principals of good asset management where a redundant asset should be disposed to generate a capital receipt that the Council can deploy for other purposes.

2.    Market the site for development. While it is likely that there will be interest from the wider market, the offer that has been put forward by McCarthy Stone is considered to exceed the value that could reasonably be expected from an open market disposal. The McCarthy Stone offer is unconditional but their agents where clear that if the Council proceeded to market, the offer received would be resubmitted but would be conditional on planning permission being secured. Thus, a certain receipt would be substituted for an uncertain, and potentially lower, one. It is not possible for the Council to be absolutely certain that a competitive bidding process would not result in a higher value being obtained, but it appears unlikely.

3.    Proceed with the unconditional offer received as it is considered to represent best consideration and would be supported by the independent Red Book valuation. The proposal is also considered to align with the strategic aims of the Council.

4.    On balance the option to proceed with the disposal to McCarthy Stone (option 3) is recommended. This would deliver on a number of useful outcomes and has no obvious disadvantages.