The purpose of the report was to update Members on progress made to date in taking forward the Council’s asset development programme and to outline next steps and issues that might arise. 

The aim of the asset development programme would be to steer and manage development opportunities from the Council’s property asset base so as to deliver improved revenue income streams from the portfolio but at the same time securing the regeneration, economic development and housing objectives of the Council.

The project board had considered a range of options for securing returns from the portfolio and at this stage favoured a hybrid approach which allowed the Council to take forward smaller projects alone but share risk on the more complicated projects.   

Under a hybrid approach straightforward smaller sites were self-developed by the Council with more complex sites developed by a single joint venture development partner in accordance with the Council’s vision for each of those sites.  The activity would be programmed over a number of years in accordance with business plans and cash flow requirements that would be agreed by Committee. 

For a hybrid approach to deliver successfully there would be a requirement for the Council to undertake development activity itself.  It would need to resource the role and manage the related risks.  In addition, it was crucial that the Council adequately resourced its role as a partner to the activities of a partnership, either as a shareholder to a new Company, or through an alternative governance arrangement.  A common mistake by Councils was not to undertake the role with appropriate resource and skillsets such that the partnership either did not operate effectively, or the rewards between the partners were not appropriately shared.   

The next stage in taking forward the project was to consult the market.  This identified market appetite for the options and assisted in defining the scope of the approach the Council may wish to take forward and how it could be realised/procured.  This would inform how the Council might engage with partners or indeed procure a Joint Venture development partner or investment partner.  It would also inform how the Council might take forward self-development projects.  As such the next stage of the work was critical in shaping the delivery of the entire programme over the future years.  

The output of the next stage would be considered by the Project Board, comprising of Cllr McKinlay, Cllr Kerslake, Phil Ruck, Steve Summers and John Chance in a check and challenge session, with the objective of developing a detailed recommendation to the Council’s Policy, Projects and Resources Committee for how the project should be taken forward.  

Cllr Mrs McKinlay MOVED and Cllr Kerslake SECONDED the recommendation in the report and following a full discussion a vote was taken on a show of hands and it was

RESOLVED that:

1.    The Committee approved a hybrid approach for securing the Councils Vision and Objectives. 

2.    Delegated authority be given to the Chief Executive in Consultation with Group Leaders or their appointed deputies to consult with the market to inform the next stage of project development. 

3.    A further report should be brought back to this committee’s November meeting with the Project Board’s detailed recommendations and action plan for taking forward this project.

4.    The committee approves that officers investigate the establishment of an appropriate investment vehicle or vehicles for the delivery of the Council’s objectives.  Such an investment vehicle will be subject to appropriate legal requirements.  

5.    That progression of the development and delivery of the asset programme will be brought to an appropriate future committee.

In response to a request, Cllr Mrs McKinlay advised that she would include updates on the asset development programme in the agenda of future Leaders’ meetings.

Reason for recommendations

The next stage in taking forward the project was to consult with the market.  This would assist in testing the appetite of the market for projects of this nature and also in defining the scope of the approach the Council may wish to take forward, and how it can be released/procured.  This would inform how the Council might engage with partners or indeed procure a Joint Venture development partner or investment partner.  It would also inform how the Council may take forward self-development projects.  As such this next stage of the work was critical in shaping the delivery of the entire programme over future years.