Agenda item

To consider a report by the Director for Place, copy attached as item 13

Note: this item was opened in the public part of the meeting, the introduction and a question were heard before the matter went into private session. The meeting was opened again and the decision of the Committee was read out

Before the Committee was a report by the Director for Place, copies of which had been circulated to all Members and a copy of which is attached to the signed copy of these minutes as Item 13

The Union Place redevelopment proposal provided a major opportunity to deliver new high quality, energy efficient, modern and affordable homes for the community in Worthing. Working with an experienced local private sector partner, the development would also deliver new commercial space, high quality green spaces, return Union Place to being a tree lined avenue and maximise opportunities for social connections to reduce isolation and promote inclusion. The development would have an architectural approach rooted in local vernacular architecture, and also sought to design out crime, improve health outcomes, and use an environmentally sustainable approach to development.

The purpose of the report was to advise members of the Committee on the progress with negotiations with the Council’s preferred Joint Venture Partner on the redevelopment of the Union Place site, and to 185 Agenda Item 13 seek the Committee’s approval to the Joint Venture Agreement and to progress towards development of the site.

The Exempt Appendices to this Report set out the detailed nature of the proposed Joint Venture Agreement which it was intended will be conducted through the formation of an Limited Liability Partnership (LLP) between the Council and Roffey Homes, and the proposal for the Council to invest land into the LLP company at the outset, with a further parcel of land being invested following grant of planning permission. The report set out how the value of the Council’s investment is then matched by Roffey Homes equity and sets out how the development will be funded. The Council’s governance structures and appointment to the LLP are set out in section 5.0.

The Exempt Appendix updated members on key issues following the most recent report on the project in March 2023 surrounding procurement, state aid/subsidy control, risk, and tax implications of the proposed joint venture.

The report summarised the work undertaken to date to design the scheme, and agree land valuations.

The report set out the various steps that would be undertaken to enter into the Joint Venture Agreement and sought various delegations to officers to enable the project to proceed.

A question was asked about the anticipated timeline of work beginning on the site. The Committee was told that a Planning Application was forthcoming for the site and the ambition was to be on site in Spring 2024 although there could be no absolute certainty in matters of this sort.  

The Committee debated matters of an exempt nature in closed session

Decision:

That the Joint Strategic Committee:

i)Delegate authority to the Director for Place to progress the negotiations and drafting of the Members Agreement and all contractual documentation required to establish the Joint Venture Limited Liability Partnership (LLP) between the Council and Roffey Homes for the purpose of developing the Union Place site on the terms set out in the Structure Note and the Exempt Appendices 1-5.

ii) Delegate authority to the Director for Place toTo take further legal, procurement, subsidy and financial due diligence on the final terms of the Members Agreement and contract documents and to produce a detailed business plan supporting the proposal to enter into the LLP.

iii) Authorise the Director for Place to enter into the LLP by executing the Members Agreement and all necessary contract documents subject to the following procedure for completion-

That the Director for Place delivers a report to the Leader of Worthing Borough Council which details:- 

a)     The final terms of the Members Agreement and Contract Documents;

b)     The outcome of the due diligence referred to at paragraph 2.3 of this report;

c)     The supporting business plan and

d)     The report shall seek authority from the Leader of Worthing Borough Council in consultation with the Cabinet Member for Regeneration for the Director for Place to enter into The Members Agreement and all necessary contractual documentation to form the LLP; including authority to continue with the land transfers which are envisaged in the Structure Note at Exempt Appendix 1 and further referred to in Exempt Appendix 5.

iv)To delegate to the Director for Place in consultation with the Leader and the Cabinet Member for Regeneration, the authority to appoint officer representatives to the LLP Board; and review and approve LLP Business Plans (including costs incurred and forecast) in consultation with the Leader and Cabinet Member for Regeneration to require the project board to report back to the JSC (SC) on a regular basis with progression updates and financial reporting

v) Prior to entering into the LLP to authorise the Director for Place to fund half of the planning costs (estimated in total at £600,000 with BC to fund £300,000) payable in the event that satisfactory planning consent for the development is not satisfied or for any reason the development does not proceed;

vi) Prior to entering into the LLP to delegate to the Director for Place authority to negotiate the final terms of the agreement with LCR to terminate the Landpool and Promotion Agreement with LCR and to consult with the Leader and Cabinet Member for Resources on the terms of the termination agreement and resource implications

vii)That the release of £300,000 from the capacity issues reserve to fund the revenue consequences of the unwinding of the LCR agreement as set out in confidential Appendix 5A be approved.

viii)Delegate to the Cabinet Member for Resources the authority to vire £570,000 from the strategic property investment fund in the event that the new LLP is not in a position to buy back the land associated with the LCR land pooling agreement as set out in confidential appendix 5b

ix)That it be recommended to Worthing Borough Council to amend the Annual Investment Strategy to allow for the acquisition of shares in the new Joint Venture.

x)That it be recommended to Worthing Borough Council that it amends the Capital Programme Investment Strategy to approve the capital investment for the purchase of a 50% share in the ownership of the LLP in the sum of £6m funded through the transfer of land and approves the appointment of Worthing Borough Council as a Member to the LLP (through a Members Agreement) and to note that the strategic and operational decisions will be made by the Executive with the project board reporting back regularly to that Committee on progression with finance reports.

Call-in:

The call-in deadline for the decisions will be 5.00pm on 21 July 2023.

There is no call-in for recommendations ix) and x) as they are recommendations to Council.