SUMMARY/PURPOSE
1.
The
Council’s Executive is being asked to agree terms for the grant of an option
for Westbury Homes to have access over Council property to a residential
development site.
BACKGROUND
2.
One
of the major residential allocations included in the Island’s Unitary
Development Plan is for residential development off Worsley Road, Newport at
Heytesbury Farm on lands jointly owned by Newport Grammar School Charity and
the owner of Heytesbury Farm, as shown on the plan attached.
3.
The development
of this site is further supported by the more recent urban capacity study.
4.
The
proposal is to develop mostly the land owned by Newport Grammar School Charity
the developable area thought to comprise some 6.382 hectares from a total
ownership of some 12.094 hectares.
Access to this site is through Kitbridge County Middle School and land
owned by Heytesbury Farm. A detailed
plan is available upon request.
Kitbridge Middle School is currently being re-modelled through three
phases over several years that will bring the school buildings up to modern
standards. As part of that process it
was necessary to acquire the adjoining former Slaughter House recently and some
Members may recall the point of discussion regarding access over the School at
that time in July 2000.
5.
The
School is already deficient of school playing field space and as part of the
planning process it has always been proposed that new playing fields should be
part of this development.
6.
Consultations
and discussions have been ongoing with the various landowners over several
years and more recently Newport Grammar School Charity took it upon themselves
to test in the open market for a developer.
From that marketing exercise a preferred developer has been agreed with
the Charities Commission and that developer is Westbury Homes.
7.
Westbury
Homes now wish to enter into option agreements with all parties to bring
forward a significant development proposal that will help support the provision
of housing needs on the Island. As
indicated negotiations have been ongoing for a long time and the terms being
proposed have been verified as best consideration by two independent valuers
employed for that purpose by the Council.
8.
There
will be some detailed issues which have yet to be resolved not least some
precise boundaries, timing, landscape arrangements and the actual programme but
given the scale of this planning application it may take in the order of a year
to resolve, then works may still be delayed dependent upon market conditions at
the time. Because of this officers have
been working to find a temporary solution to the playing field shortage at
Kitbridge School and a local solution may be available through the HM Prison
Service.
PROPOSED TERMS
9.
That
a landowners agreement be entered into between the Isle of Wight Council,
Newport Grammar School Charity and the relevant members of the owners of
Heytesbury Farm.
10.
As
part of this process option agreements are being signed between the various
landowners and Westbury Homes and the agreement with the Isle of Wight Council and will include the following
benefits:-
(a)
A
share of the net development value of the land which is subject to the option
agreement with Westbury Homes and a valuation clause contained therein. In essence the valuation procedure affords
the joint land owners 93% of the land’s development value to the Newport
Grammar School Charity and the Farm and from this sum the figure of 12½% will
be reserved for the Isle of Wight Council.
(b)
The
Council shall receive freehold title of the playing field land being
approximately 4 hectares of land. The
boundaries of the land have yet to be confirmed and will depend on the final
arrangement of services and infrastructure and the details will include
provision for the owners of Heytesbury Farm to retain a 10 metre wide access to
their retained land for all purposes.
(c)
Additionally
in respect of the land currently in the ownership of Heytesbury Farm which is
to transfer to the Council, the transfer will be subject to an overage
provision for the benefit of the current owners and the Newport Grammar School
Charity entitling them to 75% of the difference between the value of the said
land as playing field with the benefit of any consent for commercial or
residential development on the whole or any part of the land where planning
permission is granted in the future.
(d)
The
Council should also receive the benefit of works to a maximum value of £200,000
for the ground works and construction works to facilitate the creating of
playing field land laid out to school playing field purposes.
(e)
The
condition of these arrangements is that the Council shall pay the legal costs
for the owners of Heytesbury Farm and Newport Grammar School Charity to be
agreed with the solicitors and the surveyors fees for revising the landowners
and drawing up landowners agreements subject to a maximum fee of £10,000 plus
VAT and the disbursements for each landowner.
CONSULTATION
11.
Bringing
forward this proposal consultations have been ongoing and a wide-ranging number
of officers to the Council, independent consultants advising the Council and
the School.
12.
No
objections have been received to the proposals which do meet best
consideration.
VALUATION ADVICE
13.
Allowing
the developer a discount on open market value to 93% is reasonable given the
cost and risk of bringing forward the whole scheme for approval. Such discounts are often between 10% and
20%.
14.
This
is a market tested transaction with land owners equalising their value.
15.
The
Council’s valuation aim is to secure 16.67% of the residual 93% open market
value of the 15.77 acres of developable land.
16.
The
terms set out above are being recommended to the Council.
FINANCIAL/BUDGET IMPLICATIONS
17.
By
granting this option the cost of the new playing field is unknown at this time
but indications are that it should be possible to contain this development for
Kitbridge Middle School within the £275,000.
This will require additional capital of £75,000.
18.
The
opportunity to receive some 12½% of the net development land value for the site
at Worsley Road subject to the planning process and market conditions means
that the Council will be entitled to a capital receipt in some 12 to 18 months
time in the order of £460,000 to £730,000 plus land and works. The exact sum will depend on the valuation
at the time.
LEGAL IMPLICATIONS
19.
The
Council has a duty to provide and maintain premises for maintained schools,
including playing fields. The land
transaction represents a sale at best consideration and a purchase under the
provisions of the School Standards and Financial Act.
OPTIONS
(a)
That
the Council agrees to the terms as set out in the report and grants the option
as proposed.
(b)
That
the Council offers its land for sale on the open market.
(c)
That
the Council continues to negotiate with the landowners in the hope of an
improved agreement.
EVALUATION/RISK MANAGEMENT
20.
Because
Newport Grammar School Charity have already undertaken an open market exercise
that is approved by the Charity Commissioners it is extremely doubtful that the
Council could improve its position by marketing its own access strip
separately, as such this option is not appropriate.
21.
As
with any agreement involving so many landowners the proposals set out have
taken a long time to come forward. All
landowners have been represented by their professional advisers and the Council
is advised that it is unlikely these terms can be improved significantly.
22.
Because
the Council is both landowner and planning authority the Council is dealing
with these processes separately. By
granting an option the developer then has to invest major resources and time to
bring forward such an important planning application. The scale of that investment would not be possible without a firm
commitment to the scheme, but by not selling the Council’s property in the
first instance this leaves an open planning process for the developer to
undertake and allows the Council as landowner to stand back from that process.
23.
Given
the planning proposal is for some reason not successful or is not implemented
or that the whole scheme falls away then the Council has the reserved position
to enter into negotiations with the adjoining landowner for the provision of
school playing fields alone and some discussions have been undertaken on this
basis.
|
RECOMMENDATIONS 24.
That Option (a) be adopted. |
BACKGROUND PAPERS
25.
Executive
6 July 2000.
Contact Point : Tony Flower, Head Of Property Services, ( 823263, e-mail: [email protected]
M J A FISHERChief
Executive Officer Strategic
Director Corporate
and Environment Services |
R
R BARRY
Portfolio Holder for
Resources |
TONY FLOWER Head of Property Services |
