TREASURY AND RESOURCES DEPARTMENT
PROPERTY HOLDINGS
Property Transaction for Ministerial Decision - Minister for Treasury and Resources
Lister House, The Parade, St. Helier - Proposed Lease
NS 2061/1
Purpose
To ask the Minister to approve a lease from the John Clive Le Seelleur Trust in respect of the above property in order to secure its use by the Department of Health and Social Services.
Background
As part of an overall plan that will see additional services provided at the General Hospital, Health and Social Services has identified a need to relocate its psychiatric clinics away from the General Hospital site. The current arrangements are unsatisfactory in terms of best medical practice for the provision of such services.
Lister House is a vacant three storey commercial property situated in the Parade which has recently been advertised for sale at £1.3m or, alternatively, to let at £96,457 per annum. It was previously used, in part, as a medical practice and totals approximately 4,440 sq. ft. The position and physical lay-out of this property on three levels would prove an ideal location from which to provide psychiatric clinics on the ground floor with the upper floors being used as office accommodation.
The ‘in-principle’ acquisition of Lister House by the Public to support the provision of these services was approved by the Minister of Health and Social Services in February 2007. At the time it was envisaged that monies from the Harold Le Seelleur Fund would be used to finance the purchase. Confirmation has subsequently been received from the Chief Executive of Health and Social Services and Director of Estates that they are satisfied with the revised terms and wish to proceed accordingly.
Current Lease Proposal
As a result of a delay in releasing monies from the Harold Le Seelleur Fund, Health and Social Services has approached the John Clive Le Seelleur Trust in an attempt to ensure an opportunity to secure the use of this property is not lost.
The John Clive Le Seelleur Trust is an independent body which has worked closely with the Department of Health and Social Services to mutual benefit. The Trust was established “for the benefit of the Public Health Committee for the general welfare of persons elderly and/or sick at the General Hospital or at any of its annexes”. As such, any funds generated by those properties it retains is received by the Public to be used in accordance with the Trust’s wishes.
Mutually acceptable terms have now been agreed for the Trust to purchase the property, subject to contract, on the understanding it will then secure a lease with the Public for a suitable period that justifies its initial investment.
Accordingly, provisional agreement has been reached with the Trust regarding a 15 year tenant’s full repairing and insuring lease of the property, to be deemed to have commenced from the date of purchase. The Trust has also agreed to fund the fitting out of the property to a specification agreed by Health and Social Services at an approximate cost of £200,000. An initial rental of £87,500 per annum has been agreed, inclusive of fit-out works subject to three yearly rent reviews in accordance with the Jersey Retail Price Index.
Although the property appears to be in good superficial repair and decorative order, the fit out works are likely to include upgrading of heating/cooling facilities, possible upgrading of the insulation to the upper floor, improved lighting, kitchen facilities, communications, as well as additional consulting rooms on the ground floor. To accord with Health and Social Services’ revenue budget and mindful of the work required, the Public will also receive a two year rent free period from the commencement of the lease.
Recommendation
That, subject to the completion of the purchase of Lister House by the John Clive le Seelleur Trust the Minister agrees for the Public to enter into a lease upon the principal terms referred to above, subject to any further advice provided by the Law Officers’ Department.
Written By: Neil Sproston
Signature …………………………
Authorised By: Eric le Ruez
Signature ………………………… 17 May 2007