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RESOLVED:
 
1. 
To agree
to the  purchase of the property
detailed in Exempt Appendix 1 - Temporary
Accommodation.

 
2. 
To
delegate authority to the Group Director of Finance and Corporate
Resources to settle all the commercial terms of the
transaction.
 
3. 
To pay the
stamp duty (SDLT) due on the purchase.

 
4. 
To
authorise the Director of Legal, Democratic and Electoral
Services  to prepare, agree, settle and
sign the necessary legal documentation to effect the proposals
contained in this report and to enter into any other ancillary
legal documentation as required.

 
5. 
To agree
the Estate Management savings proposal at 2.11
above.

 
6. 
To agree
the Parking Income proposal at 2.11 above.

 
7. 
To approve
the granting of an Agreement for Lease to SBSK to allow for the
works to be completed at Springfield Hydrotherapy Pool  leading to the grant of a 15 year lease, at an
initial rent of £2,500.00 p.a. subject to an RPI rent review
on the 1st April each year.

 
8. 
To
delegate to the Group Director of Finance and Corporate
Resources 
and the Director of Strategic Property Services authority to
determine the most cost effective options in terms of disposing of
the lease in ways that represent best value on the part of the
Council.

 
9. 
To
delegate authority to the Director of Legal, Democratic and
Electoral Services to negotiate, sign, settle and complete the
contracts and all other relevant and ancillary legal documents
arising thereto on behalf of the Council.

 
10.To approve the granting of an Agreement for Lease
in respect of 2 Hillman Street, to DWP with the proposed rent free
and break clauses to allow continuity of occupation of the building
from January 2024.

 
11.To approve the grant of a 10 year lease, at an
initial rent of £711,000pa subject to a rent review on the
5th anniversary of the term. 

 
12.To delegate to the Group Director of Finance and
Corporate Resources and the Director of Strategic Property Services
authority to agree to the lease and ensure that it represents best
consideration.

 
13.To delegate authority to the Director of Legal,
Democratic and Electoral Services to complete the lease and all
other relevant and ancillary legal documents arising thereto on
behalf of the Council.

 
14.To note the overall financial position of the
Council as at May 2023 as set out in this report.

 
REASONS FOR DECISION
 
To facilitate financial management and control of the
Council's finances.
 
As outlined within the report, there is a significant need
to expand the stock of social housing in Hackney and retain as well
as increase the provision of temporary accommodation. The Council
has a statutory duty to provide interim temporary accommodation to
homeless households and it is currently meeting this statutory duty
in part by using expensive nightly let and/or spot purchased
accommodation. The acquisition of the property detailed in Exempt
Appendix 1 increases the provision of this vital accommodation
thereby reducing the need to use these more expensive forms of
alternative accommodation.
 
With regard to the Springfield proposal, the Hydrotherapy
Pool has not been in use for nearly 10 years and this is an
opportunity to bring it back into use for the benefit of the
Borough. The Pool needs a great deal of money spent on it which
SBSK is currently in the process of raising.
 
SBSK have confirmed that they will make the Hydrotherapy
Pool available to all residents of Hackney who have a need for the
benefits that such a Pool can provide. This will meet the
Council’s requirement for proportionality and respect for
human rights under Article 13 of the Constitution.
 
On the 2 Hillman Street proposal, DWP has served a break
notice ending their present lease in January 2024. DWP requires a
timely decision from the Council as to whether they will permit the
granting of a 10 year lease under the terms noted in Appendix 5 or
they will look to relocate to another privately owned
building.
 
DETAILS OF ALTERNATIVE OPTIONS CONSIDERED AND
REJECTED
 
This budget monitoring report is primarily an update on the
Council’s financial position.
 
With regards to the property proposal detailed in Exempt
Appendix 1, the Benefits and Housing Needs Service is facing a
shortage in the supply of Council owned and / or leased
accommodation for use as emergency / temporary accommodation,
especially within the borough. This has resulted in the increased
use of expensive nightly paid accommodation, plus the increasing
use of out of borough accommodation. Purchasing the block of flats
will be less expensive than the alternatives, which are likely to
be largely out of the borough; and allow more residents to be
offered temporary accommodation in the borough.
 
With regards to the Springfield proposal, the do nothing
option will mean that responsibility for the Hydrotherapy Pool
stays within the Adventure Playground lessees who have no funds to
bring it back into use and its deterioration will continue, and
cost of repair will continue to escalate. The offer from SBSK is
currently the only offer to bring the Pool back into
use.
 
On the DWP proposal, the Council could consider rejecting
this proposal, taking the property back in January 2024, and then
marketing the building openly. The DWP would have to relocate to
another privately owned building within Hackney.  This option has been rejected because the
cost of security, business rates and other ancillary costs,
excluding marketing costs and re-letting incentives, is estimated
at £585,280 per annum. A typical void period of a building of
this type and location is estimated at 18-24 months, but the loss
of rent could extend much further depending on the rent free
negotiated by the incoming tenant.