Decision Maker:

Outcome: Recommendations Approved

Is Key Decision?: No

Is Callable In?: No

Date of Decision: February 25, 2026

Purpose:

Content: 13.1 The Director of Regeneration and Development introduced the report which provided committee members with an update on the financial position of the Heart of the City II project, including the impact of current lettings.   It sought approval to reallocate the surplus capital budget to support development and fit out of unlet units. It also requested delegated authority for Officers to investigate and adopt a policy of retaining the units in a Special Purpose Vehicle (SPV), to maximise commercial opportunity and potentially provide an attractive option for disposal at a later date.   Finally, it sought approval to procure partners to provide Asset and Property Management services for the estate.     13.2 RESOLVED UNANIMOUSLY: That the Finance and Performance Policy Committee:-   a)    Note the scale and impact of the Heart of the City II Estate; the successful delivery of the capital works to budget and the successes of letting activity made thus far. b)    Approve the reallocation of the remaining approved capital budgets as per Appendix 1. c)    Note the updated Business Plan and the impact on the 26/27 Revenue Budget. d)    Approve the commission of an Asset Management services provider for the Heart of the City II estate, via direct award. e)    Approve the commission of Property Management services via an open tendering process. f)      Note that officers will explore the creation of the most appropriate vehicle to maximise rental income in the scheme and provide an attractive proposition for investment into this vehicle as part of a potential long-term disposal plan, and approve the commission of financial, legal, and technical advice necessary for that work A further report will be provided to the Committee at a later date.     13.3 Reasons for Decision     13.3.1 The Council needs to provide efficient asset and property management services to ensure NOI is maximised and the Estate is run effectively. It also needs to ensure that the Estate is structured in a way that maximises the financial and investment returns to the Council. This report requests that the Committee approves the procurement of asset and property management services and delegates authority to Officers to structure the Estate in a manner that achieves these objectives.     13.4 Alternatives Considered and Rejected     13.4.1 Return the proposed virement amount to the overall capital budget. This has been rejected as capital incentives are the expectation of any prospective tenant. Not having sufficient budget would significantly limit our ability to attract tenants at a scale and significance that is deserving of the development.     13.4.2 Dispose on a block-by-block basis the individual blocks as and when we are able to. This has been rejected as the estate has the potential to return a much higher receipt to the Council by offering up all the blocks in an SPV as part of a specific scheme.