Content

RESOLVED:
 
1. 
That the
scheme for Finance & Corporate Resources as set out in section
11 be given approval as follows:
 
Millfield Waste Depot Rectification
Works:
Resource and spend approval of £897k (£65k in 2023/24, £772k in
2024/25 and £60k in 2025/26)is requested to enable
Council officers to proceed with the rectification works associated
with various long standing, latent ground defects at the
site.
 
2. 
That the
scheme for Climate, Homes & Economy Directorate as set out in
section 11 be given approval as follows:
 
Olive School: Resource and spend approval of
£391k (£274k in 2023/24 and £117k in
2024/25) is requested to enable Council officers to carry out
Highway Works at this school site.
 
3. 
That the
s106 Capital scheme summarised below and set out in section 11 be
approved:
 

S106

2023/24

£'000

2024/25

£'000

Total

Capital

0

44

44

Total Capital S106 for
Approval

0

44

44

 
4. 
That the
s106 Capital scheme summarised below and set out in section 12 be
noted:
 

S106

2023/24

£'000

Capital

140

Total Capital S106 for
Approval

140

 
5. 
That the
capital adjustments of the budgets outlined in section 12 be noted
and summarised below be noted:
 

Current
Directorate

Budget
2023-24

Change

Updated
Budget 2023-24

Budget
2024-25

Change

Updated
Budget 2024-25
 

Budget
2025-26

 

Change

Updated
Budget 2025-26

 

 

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

Non
Housing

2,624
 

1,900
 

4,524
 

8,674
 

(1,454)
 

7,220
 

6,512
 

(446)
 

6,066
 

Total

2,624

 

1,900

 

4,524

 

8,674

 

(1,454)

 

7,220

 

6,512

 

(446)

 

6,066

 
6. 
Authorise
entering into an agreement to lease (“the Agreement”)
with the Old Fire Station Stoke Newington CIO to grant a lease of
up to 25 years for 61 Leswin Rd,
London, N19 7NX (“the Property”) as is shown edged red
on the plan attached at Appendix 1.

 
7. 
To agree
that the terms of the agreement be that, prior to the grant of the
lease, the Old Fire Station Stoke Newington CIO
should:

 
a. 
Submit a
viable project plan which details the development plans and the
associated fundraising strategy, to be agreed by the Council,
within 6 months from the date of the Agreement.
b. 
Submit a
business plan setting out how the OFS will operate for the benefit
of local residents, which includes provision for full maintenance
of the premises, to be agreed by the Council.
c. 
Provide
evidence that planning permission has been granted for the proposed
scheme within 18 months from the date of the
Agreement.
d. 
Provide
written confirmation from funders, within 18 months from the
Agreement, that all finance for the development is available to
proceed to a start on site.
e. 
Submit
final construction plans to the Council for approval prior to
commencement of works.
f. 
Submit
relevant documents certifying the practical completion of
construction works within 2 months of completion.
g. 
Enter into
a Community Agreement with the Council which will set out services
and benefits to be delivered to local residents and include
provision for ongoing monitoring and reporting.
h. 
To
commence and complete the works and meet all terms and conditions
of the agreement to lease within 4 years of the date of that
agreement. 
i. 
To
authorise the Acting Director of Legal, Democratic and Electoral
Services to terminate this agreement for lease if the conditions
above are not met within the specified deadlines.
 
8. 
To
authorise the Acting Director of Legal, Democratic and Electoral
Services  and the Director of Strategic
Property Services to agree all commercial terms of the Agreement to
Lease and lease on the basis of these conditions and to incorporate
a covenant that a lease will be granted upon the full performance
of these terms.

 
9. 
To
delegate authority to the Interim Group Director, Finance and the
Acting Director of Legal, Democratic and Electoral Services to
agree all necessary documentation and enter into a lease of up to
25 years, and to agree all other terms of the lease provided that
the requirements of S123 Local Government Act 1972 are
met.

 
REASONS FOR DECISION
 
The decisions required are necessary in order that the
schemes within the Council’s approved Capital programme can
be delivered and to approve the property proposals as set out in
this report.
 
In most cases, resources have already been allocated to the
schemes as part of the budget setting exercise but spending
approval is required in order for the scheme to proceed. Where,
however, resources have not previously been allocated, resource
approval is requested in this report.
 
To facilitate financial management and control of the
Council's finances.
 
Proposed lease of The Old Fire Station, 61
Leswin Road N16 7NX:
The purpose of
entering into an agreement for a long lease is to enable OFS to
secure significant capital funding for improvements to the
premises. For the level of capital investment OFS are seeking,
approximately £2.3m, funders will usually require them to
have secured a lease of 25 years.
 
· 
The approach adopted
for the OFS’s development plans for this site is consistent
with the strategy the Council has adopted moving forward as a
potential option for complex and high-cost non-core assets. A
conditional agreement to grant a 25 year lease will enable OFS to
apply for capital funds to invest in this asset.
· 
Where longer term
leases are agreed, these would typically be on full repairing and
insuring terms with the tenant being responsible for repairs and
maintenance during the term of the lease. 
· 
If the tenant
successfully delivers their own capital improvement plans at the
site, this will enhance the scope, scale and quality of services to
the local community, and support the viability and sustainability
of the Old Fire Station CIO.
· 
The services provided
by the OFS deliver environmental, economic and social benefits for
the area and to local communities. For example; Growing Communities
grow and distribute sustainably grown and sourced food to local
residents, OFS contributes to local economic objectives by
providing employment opportunities, training, volunteering
opportunities and support working parents through the provision of
nursery places and co-working space for local organisations, OFS is
a also local community hub providing spaces for events, community
meetings, social activities and a wide range of health and
wellbeing and information and advice services.   
 
DETAILS OF ALTERNATIVE OPTIONS CONSIDERED AND
REJECTED
 
Proposed lease of The Old Fire Station, 61
Leswin Road N16 7NX:
The Council has
considered and rejected a number of alternative options as set out
below. It is important to note, however, that if the OFS is not
able to meet the conditions set out in the Agreement to Lease,
these options will have to be reconsidered.
 
Continue Current arrangement:
The option to continue
to lease the premises on the current basis - standard VCS lease
terms would not enable the tenant to secure the significant
investment the building requires. If we proceeded on this basis the
asset would not be upgraded and modernised, services to local
residents would not be enhanced, and the Council would continue to
bear the annual maintenance and repair cost (approximately
£20k) of this complex asset.  The
current rent paid by the tenant does not cover these costs so the
building would continue to run at a loss. It is unlikely that the
rent could be increased without putting the operation at
risk.  It is anticipated that within the
next 3 - 5 years the Council would have to invest a significant
capital sum to address further repairs, Minimum Energy Efficiency
Standards (MEES) and other statutory obligations in order to
continue to let the building.  There is
also a risk in the medium to longer term, that the OFS would find
it challenging to continue operating the building if there was no
agreement from the Council to grant a longer term lease to
facilitate investment. If the building is not improved this will
affect the future income, viability and sustainability of the OFS.
This could leave the Council with a very challenging asset
management issue, with the 6 sub occupiers expecting to remain in
situ.
 
Letting on Commercial Terms:
The current operation
of the building, i.e. being used by not-for-profit organisations
and community groups, would not be sustainable on a commercial
rent. The only way a commercial rent option could be implemented
would be to terminate the current arrangement and the occupation of
existing users, and re-let to commercial operators. This would
present a number of significant challenges, including legal and
practical implications of getting vacant possession; planning
restrictions; and financial viability of converting the building to
suit modern, commercial occupier needs, such as Minimum Energy
Efficiency Standards (MEES) obligations, upgraded mechanical and
electrical services and a lift. This option is therefore not likely
to be practically or financially viable.
 
Development for residential use:
This option presents
similar challenges; the legal and practical implications of getting
vacant possession; lack of financial viability to convert to
affordable housing in line with Council Policies; and planning
restrictions.
 
Freehold Disposal of the Asset:
This is a locally
listed heritage asset that is a unique and longstanding asset in
the Council’s portfolio and is considered to be a landmark
building by local residents and wider community and also a key part
of the wider VCS portfolio. A freehold disposal would likely
attract residential developers and, whilst the organisation in
occupation may well want to bid, it is likely that they would
struggle to raise the capital to fund a purchase and the
renovations they would like to undertake. A freehold disposal would
in all probability mean the end of the tenure of the current
organisation, the loss of the services they provide to local
residents and the conversion of the premises to residential
use.  A disposal of the freehold to the
current occupiers in an ‘off market’ transaction is
another option that has been discounted as, in all probability, it
would have to be at a substantial discount to market value, as
indeed is the approach recommended in this report. This would be
without the control that a leasehold transaction allows at the end
of the lease, ultimately, the premises returning to the
Council.