Council to sell off £100m of assets
BUILDINGS OWNERSHIP REVIEW
OLD office buildings and former schools are set to be put up for sale as Nottingham City Council plans to sell £100 million of assets.
The move is part of a long-term action plan designed to return the council to financial stability.
Buildings currently rented by community organisations – often with peppercorn rents – will be looked at on a case-by-case basis, the council says.
The move comes after a Government report told the council to publish a recovery plan due to significant budget shortfalls and failings in governance.
The council has now published that plan, with a host of measures planned to restore financial stability by 2023, including looking at how council companies are managed, an “invest to save programme” funded by short-term Government loans, and a review of a council plan set in 2019.
Among the most significant in terms of the financial impact on the council is what the council calls its “asset strategy”.
The plan says: “Key to the delivery of the recovery plan is the acceleration of the council’s asset rationalisation programme and the generation of capital receipts.
“As part of an earlier phase of this programme a pipeline of (approximately) £100 million of sites that could be disposed of has already been identified, and a number of disposals made over the past 18 months.
“This workstream will accelerate and put forward further recommendations for sites to dispose of, and then carry out disposal in the manner which will leverage the greatest value.”
Councillor David Mellen is the leader of the council, and represents the Dales ward for Labour.
Asked which buildings were set to be sold, he said: “There’s a variety of different types of buildings. Some of them are buildings that we’ve used for council purposes, and are no longer necessary.
“When we moved to Loxley House, prior to that we had a wide range of buildings across the city centre that we were operating out of.
“As we’ve gone through, places like Lawrence House have been closed and sold for other purposes, and that continues.
“Isabella Street, which is on the edge of Castle Boulevard, is one where various children’s services and youth offending team were in there in the past, and still are to a certain extent, but we expect to move out of there and to sell that building.
“It is a prime city centre site and therefore will yield an asset and a capital receipt for us.
“Other things are former school sites that might be used for development or sold to other people.
“We have quite a wide scope of property we own, and some of that gives us a rental or leasehold fee... but there are also some assets that haven’t yielded a high fee and there are places that need a lot of work done to them or property management, which is a cost to us, so if we can sell them that’s a helpful thing for us, and could provide scope for new businesses to create jobs, or it could be that it’s for housing or other uses.”
Another aspect of the asset strategy contained within the recovery plan is a review of community organisations using councilowned buildings.
Councillor Mellen said: “I think we need to balance the benefit to the community of the activity going on in the building and the fact that the building as the landlord it may well be causing cost to us, and at a time when we have to be tighter with our budget we have to balance those things together.
“In some cases some community groups have far more access to bidding for money than we do and therefore we need to set a realistic level of rent that reflects both the benefits that the community has from the activity – and we have many many members of the voluntary sector who are doing a great job in Nottingham and particularly have done a great job during Covid – but they need to be look at on a case-by-case basis and we’ve already started doing that.
“Sometimes we find ourselves saying, because a group may have very little money, that we will give them the building on a peppercorn rent, but then finding that the boiler needs replacing or the roof is leaking, and therefore there’s a big disproportionate effect on the city council and we need to rationalise that.”
The draft recovery plan is expected to be formally approved by a full meeting of the city council today.