The request for this decision is made further to Decision Record 05-2014 dated 22nd January 2014 and Decision Record 44-2015 dated 30th July 2014 in relation to the Sale of Ladgate Lane and the Community Safety Hub.
The negotiations for the Sales Agreement for Ladgate Lane are now finalised and documented. The Sales Agreement is now ready for signature. The following set of documents need the PCCs approval for authorisation for signature to enable the sale to take place: -
- Sale Agreement with Persimmon Homes Limited
- Licence for a Compound to be stored at the Site on Ladgate Lane
- Licence for Surveys
The authority to sign the documentation is delegated to the Chief of Staff. Nonetheless, the PCC’s statutory officers and the Community Safety Hub Project Board considered it prudent and appropriate to seek the authority of the PCC for executing the sales agreement. The sale of Ladgate Lane site represents a significant transaction for Cleveland Police, the PCC and for the public. The sale provides significant capital receipts to enable investments in a more energy efficient estate, which is fit for purpose for the future of policing in Cleveland and which delivers ongoing reductions in running costs (revenue costs) to better match the PCCs long term financial plans. In particular, the sale provides the basis for the funding arrangements for the Community Safety Hub, a major development which will combine major elements of headquarters provision with flexible multi-agency accommodation as part of the delivery of the PCC’s commitment to extending police and pan- public sector cooperation and collaboration.
Persimmon Homes Ltd has advised that they will work closely with local communities, Middlesbrough Council and the PCC to identify opportunities for employment and investment in the economy of the local area.
The PCC will also use the capital receipt of funds to procure the land and construct the Community Safety Hub, in which again the construction provider will be required to provide local employment and investment in the local economies of the Cleveland Police area.
Sale Agreement with Persimmon Homes Limited
The price for the Sales Agreement is in line with the Business Case for the Community Safety Hub and tendered bid from Persimmon Homes Ltd. The sales price for Ladgate Lane site will not be published within this Decision Record due to the commercial sensitivities relating to the timing of this sale and the timing of the tender process for the purchase of the Community Safety Hub. It is recognised that the price will be placed on the public record by the Land Registry in accordance with their processes, following the completion of the transfer of the land. The price will be made available by the PCC in accordance with the Community Safety Hub Project Publication Strategy, which in order to preserve the integrity of the procurement process (and therefore protect public funds) will be strictly not before the conclusion of the tender and agreement for the Community Safety Hub.
The Sales Agreement allows for the sale of Ladgate Lane in six tranches, termed a Phase. The first Phase will transfer to Persimmon Homes Ltd once the conditions within the Sales Agreement are met. Each Phase would then transfer to Persimmon Homes Ltd on each anniversary of the first Phase being achieved. Payments based on the size of each Phase, will be made by Persimmon Homes Ltd to the Office of the PCC for Cleveland. The land element associated with each Phase is of relatively similar size.
The three main Conditions that need to be met by Persimmon Homes Ltd to deliver Phase One completion are: -
- The Planning Condition - Securing of detailed planning permission from Middlesbrough Council. Note: Outline planning permission is already in place
- Procuring of Title Indemnity Insurance
- Agreeing of Easement for Northumbria Water Waterpipe
Once the Sales Agreement is signed, the PCC and Persimmon Homes Ltd will enter into a ‘conditional’ contract. The agreement will become ‘unconditional’ once the above Conditions are satisfied. Currently, it is estimated that all these Conditions will take around six months to resolve. The main driver for this is the Planning Condition.
The Planning Condition needs to be concluded within a maximum of 18 months of signing the Sales Agreement. If the Planning Condition is not met within this time, then either party can terminate the Sales Agreement. Both the PCC and Persimmon Homes Ltd are obliged to conclude matters within this timeframe. Should it not be concluded then the PCC can re-offer the land for sale to other organisations.
When the Conditions are complete the first Phase will be purchased by Persimmon Homes Ltd.
The first two Phases of the sale do not impact upon the operation of the current Police Headquarters building. Phase Three (the transfer of ownership within two and half years from signing the Sales Agreement), requires the PCC and Chief Constable to ensure vacant possession of the building.
The requirement to deliver vacant possession is built into the project for the Community Safety Hub and is managed by the Board for that project. The Community Safety Hub Project Board is jointly chaired by the Chief of Staff for the PCC and the Deputy Chief Constable of Cleveland Police.
Once Phase Three is concluded, then Phases Four, Five and Six can be transferred and paid for by Persimmon Homes Ltd on each anniversary, or brought forward should Persimmon Homes Ltd desire it.
The final phase would be complete on the 5th anniversary date of Phase One. This is currently estimated to be Autumn 2020.