That the report be noted and the following recommendations be approved:
1. To delegate authority to the Director of Housing Planning and Regeneration to agree terms with the existing tenant of Churchill Theatre, Trafalgar Group, to gift the Council’s freehold interest in the whole site alongside negotiating a reverse premium to be paid to Trafalgar Group on completion of the freehold transfer to enable the tenant to invest in the building to ensure a sustainable future for the building and to protect its future use as a theatre. With terms, once agreed in principle, to be subject to further approval by the Executive Committee.
2. As detailed within this report, the existing arrangement is not sustainable as there are significant works required to the building if it is it have a future, and therefore the existing lease arrangement with Trafalgar Group needs to be terminated to enable the works required on the building to be undertaken which cannot be facilitated whilst the building is occupied and operational. It is therefore recommended that the Landlord’s Break Clause in relation to the lease held by Trafalgar Group is triggered which must be served on or before 1st April 2024 in accordance with the terms of the existing lease providing a minimum of 24 months’ notice thereby terminating the existing lease arrangement as of 2nd April 2026.
3. Should Trafalgar Group confirm they are unwilling or unable to take gifted ownership (and a reverse premium) of the site, then it is recommended that the Executive Committee delegate authority to the Director of Housing Planning and Regeneration to openly market a 999-year leasehold interest in the site to secure a private developer to undertake the required redevelopment under a Development Agreement, with the 999 year lease only being granted, with vacant possession, on completion of the agreed scheme as agreed and stipulated within the Development Agreement. All offers received would be reported back to the Executive Committee for a Member decision to enable Member selection of a preferred bidder.