AGENDA ITEM 9
REPORT TO CABINET
1 JUNE 2004
SITES IN THE PORT: RATIONALISATION OF CURRENT LEASES
PART OF PUBLISHED FORWARD PLAN: YES
STATUS – SERVICE DECISION
1. PURPOSE OF THE REPORT
A report was presented to the Cabinet at its meeting on 6 April to update members on progress with discussions and negotiations on the three sites in its ownership in the Port.
It was agreed to present a follow up report on the outcome of further negotiations.
2. DECISION REQUIRED
2.1. That members note the content of this report and the attached Confidential Appendix.
2.2. Approve the proposed Terms and Conditions and financial proposals in the report subject to the completion of appropriate legal documentation to reflect the proposed moves and to secure the Council’s position.
3. BACKGROUND
3.1. The report presented to members at the 6 April meeting resulted in the following decision:
(i) That the report be noted and the current progress with discussions and negotiations in respect of the three sites in the ownership of the Council be noted:
(ii) That the request for the grant of new ground leases for a period of 199 years be approved and:
(iii) That a further report on the outcome of detailed negotiations be presented to a future meeting of the Cabinet.
3.2. The Council currently leases the three sites in its ownership as follows
SITE
/TERMS
/LESSEE
/ CURRENT RENT£ /
TERMINATES
Ballast Quay / 14 Years / PHC / 70,000 / March 2010Yard Quay / 50 Years / PHC / 950 / March 2005
Wessex Wharf / 20 Years / RMC / 55,000 / March 2011
The three sites are indicated on Drawing A attached to this report.
3.3. The aim of this review has been to consider the opportunities to promote the reuse of the sites in such a manner as to create a vacant site which will give the Council the option to dispose of the site to Sunseeker to allow relocation of operational boat building activity from their existing site on West Quay Road and at the same time ensure the Council continues to obtain best consideration for its property interests.
3.4. As a result further negotiations have now taken place with both Poole Harbour Commissioners and Sunseekers to progress the heads of terms for leases of the following sites.
Ballast Quay and Yard Quay: 199 years to Poole Harbour Commissioners
Wessex Wharf: 199 years to Sunseeker.
4. BALLAST QUAY AND YARD QUAY
4.1. Poole Harbour Commissioners initially required the freehold interest in these sites but are prepared to accept a lease of 199 years for the merged two sites on the payment of a capital premium and at a peppercorn rent.
4.2. The proposed site to be leased is indicated in pink on the attached drawing B with the existing public right of way to be included cross hatched in black.
4.3. As part of the proposal Poole Harbour Commissioners have agreed to sub let part of the site to RMC Aggregates to allow their relocation from Wessex Wharf.
4.4. FPD Savills have been advising the Council on this matter and have been negotiating on behalf of the Council with the Harbour Commissioners. The attached confidential annex provides members with the outcome of these negotiations and which are as yet subject to the completion of appropriate legal documentation to reflect the various complex agreements.
4.5. It is intended that the new lease would continue to restrict the use of the site to port related employment activities only.
5. WESSEX WHARF
5.1. To provide for the surrender of Wessex Wharf and the vacation of the site RMC have been in negotiations to relocate the whole of the business operations currently undertaken to a site within the Ballast and Yard Quay holdings, to be sub let from PHC.
5.2. On surrender of the Wessex Wharf site back to the Council the opportunity arises to grant a new lease to Sunseekers who are already in ownership of the site immediately to the west of Wessex Wharf and the former Bolsons shipyard site on the eastern side of Ferry Road.
5.3. The District Valuation Officer, Inland Revenue have been negotiating on behalf of the Council with Sunseekers and the current position with these negotiations is similarly included in the confidential part of this report.
5.4. Members should be aware that as Sunseekers qualify as a “special purchaser” as adjoining landowner and under Contract Standing Orders the Council is not obliged to market the site on the open market if it so decides and it can demonstrate that it is receiving best consideration for its interest.
5.5. It is proposed that the new lease will include covenants restricting the use of the site to boat building and port related employment activities only.
6. RIGHT OF WAY AND ACCESS ISSUES
6.1. The above proposals involve the relocation of RMC Materials onto Yard Quay and part of Ballast Quay. The two sites are currently separated by a Right of Way which offers pedestrian and vehicular access to a short stretch of quay frontage with steps down to the water. In order to accommodate the relocation of RMC Materials, however, the right of way would need to be extinguished. There are two options available for dealing with the existing highway:
6.2. a) Extinguishment via the Planning Act
This is dependent upon first having a planning permission in place which requires closure of a highway to enable its implementation. In this case RMC would need to secure a planning permission for yard Quay/Ballast Quay sites. The Local Authority would then apply to Government Office for the South West (acting on behalf of the Secretary of State) to stop up the highway. This approach is logical as it relates directly to the proposed development and the Local Authority would need to demonstrate that the closure is required in order to implement the planning permission. However, the time frame of this process is uncertain as the presence of objections to the proposed closure could result in a public inquiry.
6.3. b) Extinguishment via the Highways Act
This option offers the potential for a quicker determination than using the Planning Act, is not dependent upon having a planning permission in place, and is determined through the local magistrate’s court rather than by the Secretary of State. Members have already authorised officers to pursue a closure using the Highways Act and a submission to the Magistrate’s Court is currently being prepared. The Highways Act places an onus upon the Council to demonstrate that the highway is no longer necessary. Notwithstanding this, it is considered that the presence of superior quayside facilities at the nearby Ferry Road would support the case for closure.
6.4. It is imperative that the issue is resolved quickly as the various relocations in themselves will take time to implement. Hence, it is considered that the best course of action is to pursue the proposed highway extinguishment through the Highways Act. This does not preclude using the Planning Act, subject to the grant of a planning permission, as the outcome of one process would not prejudice the determination of the other given that the tests involved in the Highways and Planning Acts are different.
7. PLANNING CONTEXT
7.1. Poole Local Plan First Alteration sets out the statutory planning framework for the commercial Port of Poole and sites within this area should be developed for port-related activities. Such uses include ‘boat repairs, dredging, aggregates handling, manufacture of building materials following the import of aggregates, storage of cargo, manufacture of products reliant upon imports from the harbour, boat storage for larger vessels, and rail freight uses associated with the port rail link’ (paragraph 9.43c) in support of this, sites with deep water frontage in the port area are reserved for uses which require such frontage (Policy E8).
7.2. The importation of aggregates is fully consistent with the intent of the adopted Local Plan in that it requires deep water frontage and is a port-related use. At the same time, the concrete plant is sufficiently related to the aggregates use to be deemed port-related. Similarly, Sunseeker’s operation involves the construction of large vessels which require a port location with access to deep water frontage. Hence, in principle, the proposed relocations would be compatible with the Local Plan.
At this stage discussions have taken place with RMC Materials about the planning issues relating to a propose relocation. In summary, the key points are:
a) Amenity
Whilst there will be no marked difference in the nature of operation between the existing and proposed sites, it is important to note that the existing use is a long-standing permission and issues of amenity will need to be considered in the light of the current planning context. In its favour, the site is within the commercial port and is probably further away from residential uses than the existing site. Nevertheless, details of the scheme, including times of operations and vehicular movements, will need to be submitted as part of the planning application.
b) Revocation of Existing Use:
Without prejudice to the consideration of future planning applications, it will be necessary to ensure that the granting of permission for the RMC operation is accompanied by the revocation of the existing consent on Wessex Wharf. The most appropriate method of dealing with this will be via a Section 106 Legal Agreement.
7.3. A Planning application has been submitted by RMC Aggregates for a new facility on Yard Quay and part of Ballast Quay. The aggregates component of the operation is deemed to be permitted development under the provisions of the General Permitted Development Order 1995 (Part 17, Class B), subject to RMC being lessees of a statutory undertaker (in this case Poole Harbour Commissioners). The concrete plant, however, would not be permitted development and so planning permission is required for this part of the RMC facility.
It should be noted that, notwithstanding the wider regeneration context, members of the Planning Committee will have a duty to consider the merits of any proposal having regard to the development plan and other material issues. Hence, the issues raised in this report should be considered without prejudice to the determination of the application submitted by RMC Materials and any future planning applications which might be submitted.
8. ECONOMIC IMPACT AND LINKS TO REGENERATION PROJECT
8.1. This project has positive implications for the local economy in that it will enable Sunseeker International (Boats) Ltd to relocate operations affected by the redevelopment of sites on West Quay Road and enable the company to start production of a new range of boats.
8.2. Currently, the company’s office headquarters and some operations linked to boat building, testing and shipping finished boats are located at West Quay Road but these will need to be relocated to enable the implementation of the Full Sail Ahead/Twin Sails schemes. The Wessex Wharf site provides the opportunity to relocate these operations. The masterplan clearly indicates that the West Quay Road site will be required for a mixed use scheme, the creation of new public waterfront, which required the relocation of Sunseekers. In addition, part of the site could be required for the regeneration scheme route for the bridge approach road.
8.3. Furthermore, there is neither the space nor facilities available to build boats over 108 feet in Poole. The lease of Wessex Wharf to Sunseeker would enable larger boats to be constructed in Poole rather than elsewhere either in the UK or abroad. It will also result in a significant number of additional jobs within the business and contracts for suppliers. As such, this project should be seen as a critical component in the further development of Sunseeker’s operations and supply chain in Poole and will help to safeguard future investment and employment in the Borough.
8.4. The wider economic implications of this project are demonstrated by the current economic impact of Sunseeker’s operations. In July 2003, the Strategic Planning Unit undertook some research making use of the ‘Extended Input-Output Model of the Dorset Economy’ designed by the South West Economy Centre at the University of Plymouth. At the time, Sunseeker employed 1350 people. Taking into account the value of contracts placed by Sunseeker with an extensive network of local suppliers and the household expenditure of staff of both Sunseeker and dependent businesses, it was
estimated that Sunseeker generates £164.1 million for the local economy. Bearing in mind that the value of tourism (direct and indirect) to the Poole economy is estimated to be £154 million p.a. (A Tourism Strategy for Poole, 2000-2005), the scale of Sunseeker’s impact on the economy is brought into sharp focus.
8.5. The Sites in the Port project will also result in the modernisation of Port facilities and investment in new plant and equipment by RMC Materials.
8.6. In view of the regional and national significance of the project, the Council has involved the South West Regional Development Agency and the Department of Trade & Industry in trying to find a workable solution to meet the needs of all parties.
8.7. Overall, a successful conclusion to this project will demonstrate that the Council and its partners mean business when it comes to supporting the development of a strong mixed economy.
9. CONCLUSION