Decision

The Council resolved:-

(i)           to note that the Finance and Resources Committee, at its meeting of 11 July 2025, resolved to:

"Instruct the Chief Officer - Corporate Landlord to continue to offer a new lease to Castlegate Arts reflecting the current lease conditions, for a term to be agreed”;

(ii)          to further note that no new lease has been agreed and Castlegate Arts Ltd do not feel able to enter into a new lease on the current FRI terms, with their occupation currently continuing on a year to year basis;

(iii)         to instruct the Chief Officer - Corporate Landlord to allow the current lease to continue on tacit relocation beyond the current lease expiry in January 2027;

(iv)         to instruct the Chief Officer - Corporate Landlord to re-open negotiations for a long lease, on terms acceptable to both parties, giving consideration to the following possibilities:-

a)        a lease length of at least 30 years;

b)        option for tenant purchase;

c)        the Council working collaboratively with the tenant to identify a long term funding and development model for the property and enable Castlegate Arts Ltd to apply for major capital grants, to facilitate the long term upgrade and repair of this important and much loved Aberdeen building;

d)        the Council giving the tenant some comfort that the building will be kept wind and watertight by the Council for the duration of any lease, subject to uneconomic repair conditions; and

e)        as part of any new lease agreement, the Council waiving any right to historic dilapidations requirements, to support the long term funding and development model;

and to report back on the outcome of these discussions and alternative options, with a costed business case to the budget process for 2027/28;

(v)          to note that there is a current electrical upgrade/ lifecycle replacement requirement for the building and that a request of up to  £50,000 has been made to the Council for this.  Given the current short-term nature of the lease and the long term benefit of lifecycle replacement, to instruct the Chief Officer - Finance to give a grant or contribution to these works of up to £50,000, to be paid from contingencies, subject to normal financial, subsidy control and other due diligence checks and requirements;

(vi)         to instruct the Chief Officer - Corporate Landlord to provide a letter of comfort, concerning the continued occupation of the building, to Castlegate Arts Ltd to support current funding applications; and

(vii)       to instruct the Chief Officer - City Development & Regeneration to provide guidance to Castlegate Arts Ltd to help them demonstrate compliance with the Council’s criteria of Following the Public Pound, and subsequently allow them to be considered for funding as part of the Culture Investment Framework at the 2027/28 budget and any other funding pots that the Council administers on behalf of national government.