Purpose

The report recommends the
disposal of the freehold interest of Pavilion No 3, Purley Way,
Croydon, CR0 4RS.  The objectives for
the disposal were to secure maximum receipts, achieve offers on an
unconditional basis with the lowest possible transactional risk and
to target capital receipts with the preferred bidder as quickly as
possible for the Council to reduce its outstanding
debt.  Terracotta Property undertook an
open market process.  A transparent and
clear process was provided for parties to undertake their due
diligence to ensure considered offers. 
Terracotta Property received thirty-nine offers.
 

Content

For the reasons set out in the
Part A and Part B report the Corporate Director of Resources and
Section 151 Officer AGREED:
 
To approve the disposal of the freehold interest of Pavilion No 3, Purley Way, Croydon, CR0 4RS at the value stated in the confidential
Part B report.
 

Reasons for the decision

The disposal of Pavilion No. 3,
Purley Way supports the requirements of the Ministry of Housing,
Communities and Local Government (MHCLG) and forms part of the
Council’s ongoing financial sustainability measures under the
oversight of the Commissioners. Further commercial reasons for the
disposals are included in the Part B report. 
 
The recommended offer for
acceptance represents best consideration.  The cost of holding and running assets is second
only to staffing costs and therefore it is important to ensure that
they are used in the most cost-effective manner. A business
case/feasibility assessment for the disposal is included within the
confidential Part B report.
 

Alternative options considered

No disposal of Pavilion No 3,
Purley Way – the business case for disposal is set out in the
Part B report.  As set out above, the
overall aim of the approved Corporate Asset Management Plan and the
Annual Asset Disposals Plan is to reduce costs of retained
corporate assets used for the delivery of services and to maximise
capital receipts.  This disposal is
required to meet those aims and enable the Council to achieve the
required asset disposals to help support the financial requirements
in line with the MTFS.
 
No disposal of Pavilion No 3,
Purley Way – the Council’s current financial pressures
and need to deliver savings means that not selling Pavilion No 3,
Purley Way at this time would impact on the opportunity to reduce
its debt balance.  Reducing the
Council’s debt balance is a requirement from MHCLG, and the
government appointed Commissioners as part of the ongoing
discussion on options for securing ongoing financial sustainability
for the Council. 
 
For Pavilion No 3, Purley Way,
the asset could be retained. However, the financial benefit of a
disposal is significantly better than retaining as the property is
vacant and in need of refurbishment. Disposal is therefore the
recommended option.