Agenda item

To consider the report of the Director Finance.

Agreed:

RECOMMENDED that Council approve:-

(1) the disposal of land at Mary Arches Street Car Park as shown on the site boundary plans in Appendix 1, the multi-storey car park site for co-living use, and the surface carpark for residential use.

(2) the disposal of land at Clifton Hill as shown on the site boundary plans in Appendix 2, for use as residential homes on the existing site (shaded blue), retaining the green shaded area for existing use as an open space, and retaining the yellow and purple shaded areas for existing uses.

(3) the granting of delegated authority to the City Surveyor, in consultation with the Leader and the Director Finance (S.151 Officer) to approve the final terms of the disposals, in accordance with the Local Government Act 1972, Section 122, to appropriate the sites which belong to the Council (shown on the plans at Appendices 1 and 2), for planning purposes to facilitate the carrying out of development, re-development or improvement on or in relation to that land; and

(4) a budget of £800,000, funded by a mix of the earmarked reserve set aside for this purpose and the surplus income from the Guildhall Shopping Centre, to cover the costs of preparing the sites for disposal and the facilitation of best consideration for the Council’s assets.

Reason for Decision: As set out in the report and amended at the meeting.

The Executive received the report, which following an Assurance Review of Exeter City Living (ECL) and Council approval in October 2023, would receive a report setting out a site disposal strategy in the likely event of a shortfall on the ECL loan after the Council acquires ECL’s assets.

The report proposed a programme of disposals as set out below:-

(1) the unrestricted disposal of land at Mary Arches Street Car Park as shown on the site boundary plans in Appendix 1 of the report;

(2) the unrestricted disposal of land at Clifton Hill as shown on the site boundary plans in Appendix 2 of the report;

(3) the granting of delegate authority to the City Surveyor, in consultation with the Leader and the Director Finance (S.151 Officer) to approve the final terms of the disposals, in accordance with the Local Government Act 1972, Section 122, to appropriate the sites which belong to the Council (shown on the plans at Appendices 1 and 2), for planning purposes to facilitate the carrying out of development, re-development or improvement on or in relation to that land; and

(4) a budget of £800,000, funded by a mix of the earmarked reserve set aside for this purpose and the surplus income from the Guildhall Shopping Centre, to cover the costs of preparing the sites for disposal and the facilitation of best consideration for the Council’s assets.

Members were advised that the S151 Officer had a legal duty to act in the best interest of the taxpayer of the city and the City Surveyor had a duty to obtain the best consideration for the Council in respect of all property transactions, which formed the officer recommendations, outlined in the report.

Particular reference was made to the Council’s owning and responsibility for maintaining 100 operational properties, 28 bridges, 50 parks, 90 play areas, alongside footpaths, a river, canal, and a Roman wall. Currently, there was £22 million of works identified in the latest condition survey that were unfunded, and the generation of capital receipts was a means of addressing the backlog without incurring service cuts.

The total cost of funding the works to the revenue budget required £1.75 million of cuts to the revenue budget on top of the unidentified £4.4 million of cuts already required in the Medium Term Financial Plan. Officers had recommended the unrestricted sale of two assets at Mary Arches car park due to the sufficient spare capacity in the city to absorb the loss of this car park. Clifton Hill had also been recommended for disposal as it was the asset being recovered from ECL and would be most appropriate for disposal.

The Leader moved and Councillor Wright seconded an amendment to the recommendations to read as follows:-

2.1 the disposal of land at Mary Arches Street Car Park as shown on the site boundary plans in Appendix 1, the multi-storey car park site for co-living use, and the surface carpark for residential use.

2.2 the disposal of land at Clifton Hill as shown on the site boundary plans in Appendix 2, for use as residential homes on the existing site (shaded blue), retaining the green shaded area for existing use as an open space, and retaining the yellow and purple shaded areas for existing uses.

The Leader explained that the reason for the revision was that the Council was committed to no Purpose-Built Student Accommodation (PBSA) on Council land and delivering residential homes for the people in Exeter. The multi-storey car park site would be used for Co Living and the surface car park for residential use. Clifton Hill, would be used for residential homes on the existing site shaded blue, retaining the green shaded area as open space. If approved by Council, recommendations on how it would be achieved would be brought back to the Executive in a future report.

Councillor Vizard, having given notice under Standing Order No. 44, spoke on this item. He welcomed the Leader’s amendment, which would ease residents’ minds and clarified that the Council would honor its commitment to the residents at Clifton Hill. It was right and transparent that the Council commissioned a renewed independent report and valuation on these sites following the winding down of Exeter City Living to allow Members to consider options for future sale and development. When proposals previously came forward to sell and develop the whole site a few years ago, the Council had listened to the community in wanting to save the green space and sporting facilities. A balanced plan for new homes and the preservation of the rest of the site was brought forward instead. 

Clifton Hill was a brownfield site which needed to careful consideration when faced with a national housing crisis in context with the challenge of preserving the threatened green fields and ridgeline of the city. The Council had to make choices about development and be responsible for providing homes of all types in Exeter over the next 20 years. The Council had no powers to control the number of students the university takes in, or the number of people who wish to come and live and work in the city.

Local authorities faced enormous financial pressures after 13 years of cuts to grants placing a terrible strain on local services. Exeter City Council was turning down millions in potential receipts by not selling the whole site by ruling out student accommodation.

Councillor Vizard welcomed the amendment which weighed up the need for homes and financial receipts with the compelling environmental case for the site. He welcomed holding to the previous decision, in ensuring that only the existing site already earmarked for family homes be taken forward, which would exclude the public green space and areas currently occupied by the ski slope and golf driving range from development. He also welcomed the Executive Members holding to the Council’s existing policy in not selling land within its ownership for student housing development.

In closing, Councillor Vizard highlighted that this was the right decision and demonstrated the commitment to protecting and enhancing the city environment, communities and raising wellbeing standards and health outcomes, while also providing desperately needed new homes to help address the national housing crisis.  It was a difficult balance but this amendment would ensure we get right.

Councillor Jobson, as an opposition group leader, spoke on this item. She welcomed the amendments and advised that her previously submitted questions were no longer relevant. She remained concerned that more Co-Living would not be beneficial for housing residents of Exeter or that Mary Arches site would be used for residential development.

Councillor Moore, as an opposition group leader, spoke on this item and considered there to be insufficient information provided to the Executive to make an informed decision on the options for disposal. She raised the following points:-

·         It was important to note that any sale would be dependent on planning permission being granted and therefore failure to agree a proposed scheme would jeopardise the Council’s ability to write off the debt.

·         Clifton Hill had permission, with conditions to provide affordable housing removed because a grant could be secured by Homes England to help fund it. The Planning Committee had indicated that it would buy those affordable homes, so had that grant and homes to be owned by the Council now been lost?

·         There was no information on the Mary Arches Multi Storey Car Park (MSCP) feasibility and how close it was to the planning permission stage. Neither Exeter City Living (ECL) nor the Council had worked on this, so why was this not bought forward to planning?

·         The Council had been awarded a grant for its demolition, was this still happening?

·         It might be possible to keep sites that currently accommodated facilities encouraging active lifestyles. Were there were plans to sell the water sports association property too?

·         In section 8.16, the outcome would be a receipt from student housing developers to cover the ECL write off generating some capital used to unlock further sites for the disposal programme. However, given the sum that has been proposed for CIL, Co-Living bedsits would be built in areas of high deprivation instead of homes, with residents paying three times over.

·         The report continued the narrative conditions that had contributed to ECLs insolvency. The auditor and the assurance review had highlighted that there had been a failure on the part of the Executive to provide proper oversight of ECL.

·         Members needed to know how much money had been spent by the Council since ECL was set up to look at site viability. What stages had the sites progressed to, why they didn’t come forward, what internal decisions were taken and at what cost?

·         the report was light on financial information. Clifton Hill was now considered a liability to the Council and Mary Arches was no longer an income generating asset. The Council was going to be asked to makes decisions without all the financial information and the full extent of the liabilities.

The Leader requested that due to the large number questions asked, that they be emailed to him for response.

Councillor M. Mitchell, as an opposition group leader, spoke on this item and thanked the officers for writing the report and noted the repercussions for the Council and the decisions to be made. He supported the amendment to allow the Council to maintain control on what iwass built on the land. He had concerns about Co Living and would like to see the evidence for it. He further noted that the recommendations would be decided by full Council where further opportunities to amend the recommendation could be made.

He raised concern that social housing development through ECL and retaining profits for investment in further ventures had not occurred and the Council was now in the situation of selling two sites with a potential deficit. A lot of money was spent on developing some very good plans for Clifton Hill in regards to the housing standards and now may see some speculative applications from planning developers to test the market.

During the discussion the following points were made:

·         there were good reasons for not making all details in the report public and some details on what the Council was willing to accept for the sale of land could not be disclosed. The Council need to manage tax payer money wisely;

·         the report was written by officers, who felt it important that the details of their report was presented to the public. Members usually agreed with officer recommendations, but on this occasion, Member’s considered the recommendations needed amending.

·         there were extensive details in the Part 2 appendices to explain the officer recommendations, and there was a complexity to the matter, but Members wanted to maintain their commitment that no PBSA’s would be built on Council land we have after it was sold;

·         the previous decisions were correct at the time, and the Council had maintained its rule in not developing PBSA’s. The student population had increased over the last decade from 14,000 students to 39,000. Housing development focused on dealing with housing needs had not kept pace and traditional housing stock has been lost;

·         the amendments were welcomed and Co-Living options were needed for younger residents and essential workers and embodied the inclusivity of Exeter; and

·         there was a housing emergency and a need for good quality accommodation for various housing needs. Protecting the city’s green ridge line was important, with limited development space and an increasing population. The Brownfield sites were suitable for good quality residential homes and Co-Living would provide that.

The Leader advised that some questions raised would be discussed in Minute No. 125, under Part 2. There were several issues to be addressed including financial considerations which would be discussed. He thanked the officers for bringing the report forward and advising on the consequences of the decisions being made.

That Executive RECOMMEND that the officer recommendations to Council be amended as follows:-

(1) the disposal of land at Mary Arches Street Car Park as shown on the site boundary plans in Appendix 1, the multi-storey car park site for co-living use, and the surface carpark for residential use.

(2) the disposal of land at Clifton Hill as shown on the site boundary plans in Appendix 2, for use as residential homes on the existing site (shaded blue), retaining the green shaded area for existing use as an open space, and retaining the yellow and purple shaded areas for existing uses.

(3) the granting of delegated authority to the City Surveyor, in consultation with the Leader and the Director Finance (S.151 Officer) to approve the final terms of the disposals, in accordance with the Local Government Act 1972, Section 122, to appropriate the sites which belong to the Council (shown on the plans at Appendices 1 and 2), for planning purposes to facilitate the carrying out of development, re-development or improvement on or in relation to that land; and

(4) a budget of £800,000, funded by a mix of the earmarked reserve set aside for this purpose and the surplus income from the Guildhall Shopping Centre, to cover the costs of preparing the sites for disposal and the facilitation of best consideration for the Council’s assets.