Agenda item

REDEVELOPMENT OF CHISLEHURST RECREATION GROUND PAVILION

Report to follow

Minutes:

Report ES16035

 

The report sought consent to grant a 25 year lease to FC Elmstead for part of Chislehurst Recreation Ground. The report also asked Members to agree the approach for accepting a grant from the Football Foundation to enable the construction of a new pavilion building at this location, as well as agreeing to accept the conditions associated with this grant.

 

FC Elmstead had been successful in securing funding of £365,000 to redevelop the pavilion. £258,865 of this funding was secured from the Football Foundation, and had a number of conditions attached to the acceptance of the monies. The report set out in detail two potential options available to the Council for meeting the grant conditions:

 

Option 1: joint delivery with the Council becoming a joint applicant with FC Elmstead.

 

Option 2: sole delivery with FC Elmstead being solely responsible for fulfilling the terms and conditions of the grant and therefore be solely liable for the any risks associated with the construction of the pavilion and its on-going use etc.

 

In both of the potential options detailed in the report, the club would be holding the Football Foundation grant monies, carrying out procurement and the build themselves. The club were currently assessing tender returns for the capital works.  Although the total project budget could not be finalised until the tender had been awarded, the final project costs should include the capital works, contingency, professional fees, VAT and the Community Infrastructure Levy payment. There were specific timescales around when the club needed to make its grant claims to the Foundation.

 

Given that there were a number of risks associated with Option 1 and that the Council may be liable for costs of £14,000 to ensure that a number of measures were in place to mitigate some, but not all, of the risks, Members were advised to agree Option 2, that the club be solely responsible for the grant monies including procurement and delivery of the project.  In Option 2, the Football Foundation had agreed to accept the proposal from the Council that the 25 year lease for the area of the pavilion be amended to include a right to use the pitches, rather than granting a separate lease. This Option significantly reduced the risks to the Council, in that FC Elmstead would be the sole recipient of the grant and therefore solely responsible for the building over the 25 year term of their full repairing lease.

 

To mitigate the risks further, it was recommended that;

 

·  the club undertook the surveys outlined in 3.12 of the report;

·  the club took out a Performance Bond to the value of 10% of the works

·  appropriate conditions relating to the construction period were included in the agreement for lease or lease (as appropriate) to protect the Council’s interest during that period

·  the building works were signed off via the Building Control process

·  a 25 year full repairing and insuring lease be issued to ensure the club was responsible for all repairs to the new building during the term

·  The Landscape Group continue to work with the club throughout the project

 

The lease for the pavilion would include wording around the potential sub-letting of the café to a third party, in that should the gross turnover of the café exceed a certain threshold, the club would pay a percentage share of this money by way of an annual rental sum.

 

Members noted that the land could not be sold, subject to a change of use, be transferred through a new lease or mortgaged without the consent of the Football Foundation throughout the 21 year term of the grant agreement. Failure to comply with these conditions would entitle the Foundation to terminate the grant agreement and to receive repayment from the club and Council of the sum equivalent to the proportion of the grant remaining at that time.

 

In response to a question from the Chairman surrounding the risks to the Council if the club runs out of funds and fail to complete the project, the Assistant Director for Street Scene and Greenspace, provided assurances that the Football Foundation were keen to promote football at the venue.  There would be Council oversight of the progress of the project and Officers were reasonably confident that the project would be delivered.  In the unlikely event that there were any issues with delivery of the project, Officers would need to evaluate the position and work with the club and the Football Foundation to identify a way of completing the project.

 

 

RESOLVED: That the Executive be recommended to agree Option 2 in the report and approve:

 

(a) The granting of a 25 year lease to FC Elmstead for part of Chislehurst Recreation Ground, on terms to be agreed by Strategic Property;

 

(b) The acceptance of a grant from the Football Foundation to be solely awarded to FC Elmstead to assist in funding the construction of the new pavilion at this location; and

 

(c) The acceptance of the legal conditions associated with the award of the grant to the club, including a legal charge upon the club’s leasehold title of the pavilion and a restriction upon the Council’s freehold title of the pitches, during the 21 year Clawback period.


 

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