Summerland Site, Rouge Bouillon, St. Helier: Disposal to Andium Homes for residential development

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A decision made 4 July 2016:

Decision Reference: MD-PH-2016-0040
Decision Summary Title :	Disposal of the Summerland site to Andium Homes		Date of Decision Summary:	14 June 2016
Decision Summary Author:	Director of Estates		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title :	Disposal of the Summerland site to Andium Homes		Date of Written Report:	14 June 2016
Written Report Author:	Director of Estates		Written Report : Public or Exempt?	Exempt Clause refs. Report and SD1 Public SD2 and SD3 Exempt QE Article 34(b)
Subject: Disposal of the Public’s land holdings on the Summerland site to Andium Homes to assemble a site for a residential development (RFo 1607-01-001)
Decision(s): In accordance with Standing Order 168 (1) (a) the Minister agreed, as recommended by Jersey Property Holdings, to notify the States of his intention to dispose of the Summerland site to Andium Homes for residential development subject to the terms of a Development Agreement.
Reason(s) for Decision: Under Standing Order 168 (1) (a) the Minister is obliged to notify the States that he has accepted the recommendation of Jersey Property Holdings to agree to the above land transaction.
Resource Implications: The financial implications of this decision are detailed in the accompanying report. There are no manpower implications in respect of this decision. When the transaction is concluded the fixed asset register and States balance sheet will be amended to account for the transaction.
Action required: 1. In accordance with Standing Order 168 (3) this decision must be presented to the States at least 15 working days before the contract is passed before Court or concluded. After the expiry of 15 working days following presentation to the States the transaction may be concluded. 2. The Minister hereby authorised, as applicable: a. under Standing Order 168 (5) the Attorney General and the Greffier to pass any contract which is required to be passed on behalf of the Public b. the Director of Jersey Property Holdings to conclude any contract which is required to be concluded on behalf of the Public.
Signature:		Position: Deputy E J Noel Minister for Infrastructure
Date Signed:		Date of Decision (If different from Date Signed):

Summerland Site, Rouge Bouillon, St. Helier: Disposal to Andium Homes for residential development

DEPARTMENT FOR INFRASTRUCTURE

JERSEY PROPERTY HOLDINGS

Property Transaction for Ministerial Decision - Minister for Infrastructure

Report and SD1 Public

SD2 and SD3 Exempt QE Article 34(b)

Disposal of the Summerland site to Andium Homes

RFo 1607-01-001

1 Purpose

1.1 This report seeks approval to the disposal of the Public’s land holdings on the Summerland site to Andium Homes (‘Andium’) to assemble a site for a residential development on the basis of an agreed methodology for determining a valuation of the residual site value and a Development Agreement.

2 Background

2.1 The site has been identified in the Revised 2011 Island Plan to provide affordable homes and has the benefit of outline planning approval for 80 apartments and 7 townhouses (ref PP/2012/0832).

2.2 The site comprises the former Summerland factory and adjacent Broadcasting House together with Thorp House and associated surface parking. A plan of the area to be disposed of is set out on Supporting Document 1 (SD1).

3 Current Position

3.1 The development of affordable housing is a stated goal of the Council of Ministers within its Strategic Plan 2015 – 2018 and follows the States decision to approve the revised 2011 Island Plan, which identified this site, together with the current Ambulance Station site, to ‘...be developed, in whole or in part, to provide affordable homes.’[1]

3.2 The Public has entered into discussions with Andium as the proposed developer of the site. Andium have Board approval for the acquisition and development and have included the site within its development programme for the period 2016 – 2020 covered by the recently published Strategic Business Plan.

3.3 The proposal has the support of the Minister for Housing and is in accordance with the policies for regeneration of St Helier within the States Strategic Plan.

3.4 The site currently has the following uses:

The Summerland and Broadcasting House buildings are occupied by the Police pending relocation to the new HQ and Station at Green Street in the first quarter 2017.
The Thorp House office building is vacant and the adjacent warehouse is let to a third party. The two year lease is due to terminate at the end of 2016.
The surface parking is managed by a third party on behalf of the Public, with parking arrangements being terminable on a one month notice period.

The site is, therefore, capable of being developed following relocation of the Police service around Easter 2017. To move the project forward, Andium will require certainty of ownership to be able to invest a considerable sum in developing detailed plans for the site to enable development to commence as soon as is practicable following vacant possession being achieved.
It is, therefore, proposed that the Minister approves the disposal of the site to Andium on the basis of the Contract of Sale set out in Supporting Document 2 (SD2) and subject to the terms of a Development Agreement set out in Supporting Document 3 (SD3).
The disposal will be in accordance with Standing Order 168 and cannot be actioned until a period of 15 working days has passed following this decision. The Development Agreement anticipates achieving a Court date by the end of September 2016.

Heads of Terms

3.8 The terms of the Contract of Sale (SD2) covers, inter alia, the following issues:

The financial basis of the disposal. Pre-feasibility work to date suggests that the site has a limited or nil residual land value, particularly in view of the requirement to demolish the existing buildings that contain deleterious materials. To protect the Public’s position, the Development Agreement (SD3) includes reference to a methodology to be developed to determine the residual land value when costs are ascertained.
The contract deals with the interim use of the site prior to vacant possession. It provides the Public with the benefit of the current income generating activities, permits the Police to remain on the site at nil rent prior to relocation and sets a longstop date for vacant possession on 1 July 2017.
The Development Agreement (SD3) sets out principles for the return of the site to the Public for a nominal sum should Andium not develop for any reason and applies the following back stop dates:

A revised planning application for the Development is not submitted by Andium by 30 September 2017; or
A revised planning permit in Acceptable Form is not received by Andium by 30 September 2018;
Andium have not commenced the Development by 30 September 2019; or
Andium decides at any time prior to 30 September 2019 that it does not wish to proceed with the Development.

Andium has a funding envelope agreed with the Treasury from the Bond funding raised for its Strategic Business Plan. Andium will agree the detailed funding allocation with the Treasury.

4 Recommendations

4.1 That the Minister approves, in accordance with the requirements of Standing Order 168 (1)(a) the disposal of the Public landholding on the Summerland Site (as shown on the attached plan at SD1) to Andium Homes for development of affordable housing, in accordance with and subject to the attached Contract of Sale (SD2) and Development Agreement (SD3).

Written By: Director of Estates

Signature …………………………

14/06/2016

[1] Revised 2011 Island Plan, Policy H1