Purpose

Consider disposal of large property investment
asset

Decision

RESOLVED that
Cabinet re-confirm the strategy to dispose of the property asset
known as Barnham Broom Golf & Country Club and in doing, to
sell the Council’s freehold interest in the property to the
tenant (or another party) at a value at or above the price listed
in Appendix A to the report and delegate the agreement of the final
terms of the disposal to the Executive Director in consultation
with the Executive Member.
 

Reasons for the decision

The asset has served its original purpose
as an investment. Whilst the asset has performed well and has
yielded a good return over the period of investment, alternative
investment options are now as competitive as the asset yield and
potentially less prone to economic shocks and more liquid creating
greater flexibility of use. They also potentially create
alternative returns required by the Council more so than purely
commercial.

 

This property’s size (it accounts
for 34% by building footprint of the Council’s total
commercial property portfolio) and specialist nature makes this
property a risk to continue to hold given the wider economic
outlook and the Council’s financial position.
 

Alternative options considered

Option 1: (recommended) Agree disposal of
the property asset.
This option would
allow for the progression of the Pre-emption process and disposal
of the Council’s freehold interest in the property asset on
terms outlined in Appendix A of the report. The disposal would be
either to the tenant or another party at or above the value of the
price outlined in Appendix A.
 
Option
2: Do not agree
disposal of the property asset and retain it as an investment
property.
This option would
cease the progression of the Pre-emption process and decline the
third-party unsolicited offer and retain the property asset within
the Council’s commercial property portfolio.