Purpose

To consider the report of the Cabinet Member
for Economic Development seeking approval for the phase 2 of the
Asset Development and Disposal Programme. 

Decision

(i) 
To approve the Phase 2 assets recommended for disposal, development
or regeneration within the Asset Development and Disposal Programme
as detailed in Appendix 1.
(ii) 
To delegate authority to the Executive Director Growth and
Prosperity, to progress and implement asset disposal, development
and regeneration opportunities within the scope of the ADDP
Programme (as outlined in Appendix 1). This decision will be taken
following the required consultation with the relevant members and
statutory officers. 

Reasons for the decision

The assets recommended for disposal or
development in Phase 2 of ADDP, as outlined in the confidential
appendix are being recommended for approval following extensive
engagement with relevant services to align with their
transformational initiatives, localised service assets review and
early market assessments, consultation with officers and relevant
members to build on the intelligence gathered within the past 18
months and select the most appropriate set of assets.
 
The receipts from these disposals are required
to help fund the council’s transformation programme and
exceptional finance support requirement.
The rationalisation of the council’s
asset portfolio will also reduce the future repairs and maintenance
liabilities reducing the requirement for further capital and
revenue funding.
 
Lastly and perhaps more importantly it also
releases assets that can support the city’s regeneration,
supported by the work of the Renaissance Board.
 
The report also seeks approval for delegated
powers to officers following consultation with relevant Cabinet
Members to progress discrete asset disposals and asset development
or regeneration opportunities within the scope of the ADDP. A
thorough decision making, and governance process is in place under
delegated powers as outlined within the March 2024 Cabinet Report,
(recommendation (iv)).  The delegated
power process will ensure the council can take advantage of the
market offers and ensure a speedy, yet robust and transparent
decision-making process.

Alternative options considered

Option 1. Do nothing:
The Council maintains a sizeable asset
portfolio containing c.330 corporate and operational properties,
and further 200 investment and commercial properties. Assets within
the General Fund incur substantial maintenance and operational
costs, including energy, insurance and business rates. If the
council does not act now and aim to reshape or condense its
portfolio of assets by either disposing of inefficient or ageing
assets or redevelop and regenerate sites across the city, there is
a risk that properties may fall into disrepair due to lack of
adequate investment. There is also a risk that the council will
therefore be unable to meet its future investment requirements to
address its ongoing maintenance liabilities for an oversized and
ageing portfolio.
 
Over time these liabilities are likely to
compound and would require continued significant financial
investment, that would not be sustainable over the long-term. Doing
nothing will also fail to meet the council’s capital receipts
targets to ensure the financial benefits and fiscal stability of
the Council.
 
Option 2: Gain individual disposal approval of
assets from Cabinet/ Council.
This approach is not sustainable when
considering the volume of assets in scope for disposals or
development within a phased programme such as this.
 
Option 3: Disposal of assets identified in
phased approach.
In March 2024 Council approved an ADDP
including Phase 1 asset list. This programme is now underway with
disposal or development proposals being progressed under delegated
authority, as stated in that report. Phase 2 is proposed in this
report. Undertaking the disposals in this phased manner allows for
a planned and manageable approach in undertaking a wholescale
review of the council’s assets.
 
Option 4: To propose an alternative list of
assets
All assets are being reviewed in a phased
manner. The phase outlined in this report is  the next tranche of
assets to be assessed. Savills have now been engaged and a
marketing programme is in place offering market assessments for
each disposal and exploring the right marketing strategy, through
to completion of sale or proposing assets suitable for development
schemes as appropriate.  To amend the
list at this stage would cause delays in securing the capital
receipts.
 
Therefore, the recommended course of action is
to proceed with Option 3.