Issue - meetings
Approve the Property Investment Strategy, recommend to Council changes to the constitution and agree the outsourcing of property investment management services
Meeting: 27/01/2016 - Council (Item 57)
Report of Cabinet 18 January 2016
Council received a report of Cabinet, including the original report presented to Cabinet at its meeting on 18 January.
The motion to increase the key decision limit to £3m for decisions relating to the investment portfolio was moved by Councillor Sharpe and seconded by Councillor Watkin.
On being put to Council the motion was CARRIED
To increase the key decision limit to £3m for decisions relating to the investment portfolio.
Meeting: 18/01/2016 - Cabinet (Item 39)
Report of Head of Regeneration and Development
A report was received from the Head of Regeneration and Development on the progress that had been made to date since the Property Investment Board was established in March 2015. The report also included a proposed Property Investment Strategy recommended by the Property Investment Board.
Councillor Sharpe commented that as it had been alluded to earlier, the Council’s funding from central government would diminish to nothing in the future. If the Council was to retain the current level of services and fulfil its aspirations then it would be necessary to seek other ways to generate income and make the best use of resources. The Council’s property portfolio had a value of £100m. However, the key issue was that the portfolio was dominated by retail which did not necessarily achieve the best returns. Through the property review it was being clarified which assets were important for operational or community reasons and which were there to provide an income.
This was a dynamic area which did not sit well with committee meeting schedules. The purpose of the report was to enable quicker decisions to be made by increasing the delegation and enabling decisions to be made by the Property Investment Board in accordance with the Property Investment Strategy. Council would be asked to agree the changes to the constitution on the levels of delegation. Any decisions on property had to be subject to a business case agreed by the finance and legal sections. The decisions would be reviewed through the Major Projects Board where questions could be raised. It was necessary, however, to be able to move quickly when properties came onto the market.
Councillor Bell commented that the Property Investment Board had met on four occasions in 2015, and again today. There needed to be more Major Projects Board meetings on a regular timetable as currently they were often cancelled. It was important for back bench councillors to have the opportunity to review decisions.
The Mayor considered that Councillor Bell had a valid point. It was also important that the policy and framework were very clear so councillors would be reassured about governance. Once a decision was taken to purchase property it would be final.
The Managing Director commented that decisions that were made within the context of the investment strategy were approved by the Property Investment Board. The report included a matrix which would be used to determine which properties would be an appropriate purchase. He suggested inviting Lambert Smith Hampton to Major Projects Board to demonstrate how the criteria from the matrix would be applied, what sort of acquisitions might result and the format of the business case so the members could see the structures involved. For example purchasing high value light industrial properties would give a better return than the 6% yield on retail properties which the council was receiving currently. The decisions taken were purely commercial and not political.
The Mayor commented that a similar practice had been in place at Hertfordshire County Council for a number ... view the full minutes text for item 39