Purpose

To consider the report of the Cabinet member
for Economic Development for the disposal and development of
assets.

Decision

(i) 
To consider the principles of Aecom’s report (Appendix 1) when determining
recommendations ii to iv below on the retention, development and
disposal of council-owned assets across the council’s
corporate and operational portfolio.
(ii) 
To approve the Asset Development and Disposal Programme and
progression of the corporate and operational properties recommended
for disposal/ development as detailed in Appendix 2 of this
report).
(iii) 
To approve the Asset Development and Disposal Programme and
progression of investment properties for disposal and regeneration
(as outlined in Appendix 3 of this report).
(iv) 
To delegate authority to the Executive Director Growth and
Prosperity, following consultation with the Cabinet Member for
Economic Development, the Cabinet Member for Finance and Change,
the Executive Director Corporate Services, and the Director of
Legal and Governance, to progress and implement asset disposal and
asset development and regeneration opportunities within the scope
of the ADD Programme (as outlined in Appendix 2 and Table 1 & 2
of Appendix 3). 

Reasons for the decision

1. 
The purpose of this report is to introduce the council’s
ADDP. To outline the recommendations relating to disposal and
development of corporate and operational assets (Appendix 2).
Additionally, to outline recommendations for the disposal and
regeneration of properties within the council’s investment
portfolio (Appendix 3). The rationale for disposal and development
of sites is outlined in Appendix 1.
2. 
The report also seeks approval for delegated powers be given to
officers following consultation with relevant cabinet members to
progress discrete asset disposals and asset development and
regeneration opportunities within the scope of the ADDP. Appendix 4
provides an outline of the type of information that will be
gathered to make robust decisions under delegated powers.

Alternative options considered

Option 1. Do nothing: The council has a
sizeable asset portfolio containing c.330 corporate and operational
properties, as well as other investment and commercial properties.
Assets within the General Fund incur significant maintenance and
operational costs, including energy and business rates. If the
council does not act and look to dispose of a proportion of these
assets, and redevelop and regenerate sites across the city, there
is a risk that properties many fall into disrepair. There is a risk
the council is therefore unable to fund the future investment
required to meet its ongoing liabilities. Doing nothing will also
fail to meet the council’s capital receipts target and ensure
the financial benefit and stability of the council.
 
Option 2: Bring each property individually to
Cabinet/ Council for approval once finalised. The current approach
for disposal of council-owned properties is for reports on
individual assets to be considered (and recommendations made) to
Cabinet or Council, depending primarily on value. This approach
would benefit from revision when consideration is being given to
progressing a significant number of disposals in a in a
1-2 year timeframe. Discrete properties
are identified in Phase 1 and therefore delegated authority is
sought within this report to action. Members will be kept updated
regarding both those discrete disposals and wider property matters
as appropriate. 
 
Option 3: Explore alternative options that do
not involve disposal of assets. One of the key outcomes of the ADDP
is securing £85M in capital receipts to benefit the future
financial stability of the council and fund the Capitalisation
Direction, approved by the Government as part of the
Council’s application for Exceptional Financial Support
(EFS). The only realistic opportunity to realise this capital
benefit is through property disposal. It should also be highlighted
that maintaining the council’s property portfolio incurs
substantial costs in terms of maintenance/repairs and rates.
Disposing of these assets will help to reduce long-term revenue
implications and create savings.