TREASURY AND RESOURCES DEPARTMENT
JERSEY PROPERTY HOLDINGS
Property Transaction for Ministerial Decision - Minister for Treasury and Resources
Public (SD1 Exempt QE Article 34(b))
Disposal of the former Ann Court site to Andium Homes
RFo 0877-01-001
1 Purpose
1.1 This report seeks approval in principle to transfer the Public’s land holdings on the former Ann Court site to Andium Homes (‘Andium’) to assemble a site for a residential development with public car parking element 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 (an estimated) 140 affordable homes, to be delivered by 2020.
2.2 The site comprises the area enclosed by Ann Place, Ann Street, Charles Street and Providence Street:
Land in the ownership of Andium Homes:
- the properties 65 to 70 Ann Court, 33, 35, 37 and 39 Ann Street, 1 and 2 Clifton Place which are rented out by Andium, and Toddy’s Bar, (red on attached plan SD2);
Land in the Ownership of the Public:
- the former Ann Court site used as a temporary public car park by TTS until January 2016, for which a fee is paid to Andium to recognise the loss of residential dwelling income to the former Housing Department (green on attached plan SD2) as well as an area to the South of Toddy’s Bar, administered by TTS as a verge area with ancillary uses (also shown in green on the attached plan SD2)
- The Public had previously entered into discussions with Jersey Homes Trust (JHT) with a view to the site being developed by JHT as a social housing site above a basement of public parking, to be funded by the Car Parks Trading Account.
- It was not possible to reach an agreement with JHT and the Trust decided not to continue with the project.
3 Current Position
3.1 The development of affordable housing at Ann Court is a key priority of The Minister for Housing, as reflected in the recent States decision to approve the revised 2011 Island Plan, which identified Ann Court as delivering a minimum of 140 affordable units of accommodation.
3.2 The Public has subsequently entered into discussions with Andium as an alternative developer of the site.
3.3 The original concept of providing the public car parking fully underground does not present good value, due to difficult ground conditions discovered by TTS engineers while undertaking the current town drainage improvement plan on the site. It is accepted that this will now result instead in a ground level car park design, which will impact on the overall number of parking spaces.
3.4 Despite this restriction, the Public is keen that the site design should seek to maximise the number of public parking spaces so far as is possible, subject to the achievement of the level of residential parking identified as necessary by Andium which is a minimum of 0.7 spaces per unit.
3.5 Various discussions have taken place involving the Strategic Housing Unit (SHU), Jersey Property Holdings (JPH), Transport and Technical Services (TTS) and Treasury, all of whom have a role in the delivery of the site.
3.6 The officer position of all the involved departments is that an agreement with Andium is the most likely way to achieve the desired outcome for the site.
3.7 This position has been agreed by the Minister for Housing and Minister for Transport and Technical Services and will be confirmed by respective Ministerial Decisions prior to a confirmation Treasury and Resources Ministerial Decision being tabled for consideration.
3.8 The Treasury has identified lending to Andium through the recent Bond issue as an appropriate funding route and will prepare loan agreement documentation and a corresponding Ministerial Decision in due course.
3.9 The Board of Andium Homes also supports the proposal for the company to undertake the development.
3.10 To move the project forward, Andium will require certainty of ownership to be able to invest a considerable sum in working up plans for the site.
3.11 It is, therefore, proposed that the Minister agrees in principle to the disposal of the site to Andium those parts of the site in Public ownership on the basis of the Outline Heads of Terms summarised below and attached to this report and subject to a detailed Development Agreement to be agreed prior to the confirmatory Ministerial Decision being produced in accordance with Standing Order 168.
Heads of Terms
3.12 An Outline Heads of Terms is attached as SD1 to this report, which covers 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 for a wholly affordable housing scheme (excluding the cost of providing public car parking). To protect the Public’s position, the Outline Heads of Terms include reference to a methodology to be developed to determine the residual land value to be agreed within a Development Agreement and determined when costs are ascertained.
- The Outline Heads of Terms will address the need for any site works currently being undertaken or planned by TTS to be complete prior to development of the site which Andium anticipate could commence in 2017 subject to planning and funding. It will also address the need for access for the Public to the Philips Street shaft.
- A minimum level of public car parking, to be paid for by the Public from the Car Park Trading Account, will be identified in the Outline Heads of Terms and set out in detail in the development agreement along with a payment mechanism.
- The Outline Heads of Terms will also deal with the interim use of the site as a Public car park until development commences.
- The Outline Heads of Terms set out that on completion of the Public car park Andium will enter into a 150 year lease with the Public, the Public will not pay any rent.
- The Outline Heads of Terms sets out principles for the return of the site to the Public should Andium not develop for any reason.
- Andium has a funding envelope agreed with the Treasury from the Bond funding raised for its Business Plan. Andium will agree the re-prioritisation of this funding allocation with the Treasury to facilitate a loan agreement being put in place.
4 Recommendations
4.1 That the Minister for Treasury and Resources approves, in principle, in accordance with the requirements of Standing Order 168 (1)(a) the disposal of the Public landholding on the former Ann Court Site (as shown in green on the attached plan) to Andium Homes for development of social housing and public parking, in accordance with the attached Outline Heads of Terms and subject to
- The production of a Development Agreement;
- Confirmation by Ministerial Decision of the respective support of the Housing and TTS Minister;
- Confirmation that funding for the development is accessible to Andium
Written By: Director of Estates
Signature ………………………… 14 May 2015
SD 2 – Land Ownership Plan
Green = Public
Red = Andium
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