Agenda item

Bicester Civic Building

Report of Head of Regeneration and Estates

 

Summary

 

To consider the brief and options for the procurement of a new civic building for Bicester, and determine the preferred method of procuring this building.

 

Recommendations

 

The Executive is recommended:

 

(1)               To resolve that the Council pursue the development of the Franklins Yard car park site with a new civic building, to comprise offices and a public library, together with a proposed hotel, on the basis that the Council finances the development in return for a future revenue income, subject to the terms of the pre-letting agreements being approved by this Committee, and completed, prior to the scheme being committed.

(2)               That any costs or expenses incurred in fees and expenses necessary to progress this proposal being met from the existing capital approval for the Bicester town centre redevelopment scheme.

(3)               To earmark £5m of general capital receipts to this project and a further report be submitted seeking the necessary capital approval, when the costs and income achievable are known.

Decision:

Recommendations approved

Minutes:

The Head of Regeneration and Estates submitted a report which sought consideration of the brief and options for the procurement of a new civic building for Bicester, and determination of the preferred method of procuring this building.

 

Resolved

 

(1)               That the Council pursue the development of the Franklins Yard car park site with a new civic building, to comprise offices and a public library, together with a proposed hotel, on the basis that the Council finances the development in return for a future revenue income, subject to the terms of the pre-letting agreements being approved by this Committee, and completed, prior to the scheme being committed.

 

(2)               That any costs or expenses incurred in fees and expenses necessary to progress this proposal being met from the existing capital approval for the Bicester town centre redevelopment scheme.

 

(3)               That £5m of general capital receipts be earmarked to this project and a further report be submitted seeking the necessary capital approval, when the costs and income achievable are known.

 

Reasons

 

The key issue is whether the Council wishes to invest further capital in Bicester town centre in return of a commercial rate of return.  If it does so it can maintain full control over the project.

 

If the Council does not wish to invest in this site, it could look to the market to provide the premises required, and secure a capital contribution towards the cost of the proposed new offices.  However, it would be necessary to transfer a significant degree of control over the project to the developer selected.

 

Options

 

Option One

The Council to act as developer, and to build the new civic building and a hotel, assuming pre-letting agreements can be secured with OCC and a hotel operator, and Bicester Town Council if relevant.  The Council will have to commission a degree of design work before it is possible to secure the binding occupier agreements, but beyond that, it would not be required to proceed unless it was reasonably satisfied that the return would be as expected.  It would be possible to finance these professional fees from the existing £10m capital approval relating to the town centre scheme, as the terms agreed with the developer of that scheme indicate that the net expenditure which the Council will incur will not exceed £8.55m.

 

At this stage the projected return on capital appears to be very attractive, and in line with normal commercial expectations.  The process of designing the scheme, obtaining planning consent and letting a building contract is likely to take around 18 months, and consequently it would not be necessary to finalise the brief until spring 2012, if a start in autumn 2013 is desired.  Autumn 2013 is the time when the existing car park is scheduled to close following the opening of the new town centre scheme car park.

 

Option Two

To advertise the development opportunity on the open market, and seek to appoint a development partner who would enter into a development agreement with the Council to provide the civic building, in  part consideration for the opportunity to develop the remainder of the site.  This would be designed to allow the market to identify the most valuable use for the site, but it is likely to be difficult to secure a revenue return rather than a capital contribution.  The developer will take a proportion of the development value as profit.  This approach is likely to involve a substantial lead in period before development could start, as it would be necessary to select a development partner and negotiate a development agreement.  Significant legal costs are likely to be required.  The process is likely to take at least two years, and hence, if the development is to commence in the autumn of 2013, an early start is needed.  This presents a problem as OCC are not yet able to commit to acquiring the library, and there is no certainty as to the Town Council’s possible requirement.

 

 

Supporting documents: