Friday 12 July 2024
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Nottingham

Buyer found for Angel Row library in Nottingham is an ‘established operator’

Nottingham City Council has approved the sale of the former Central Library building located on Angel Row.

The decision, confirmed by the Executive Board, is part of the Council’s ongoing efforts to manage surplus property assets effectively and contribute to the city’s development.

Key Details:

  • Property Status: The former Central Library was declared surplus and has remained vacant.
  • Sale Approval: The sale terms have been outlined in an Exempt Appendix, which remains confidential to protect the Council’s strategic and commercial interests.
  • Strategic Fit: This sale aligns with the Council’s “Together for Nottingham Recovery and Improvement Plan” and aims to generate a significant capital receipt.
  • Financial Impact: Holding costs for the vacant property currently amount to £162,000 annually, with potential increased insurance costs estimated at £319,000. The sale is expected to mitigate these costs.

Economic and Community Benefits:

  • Capital Receipt: The disposal is projected to yield a substantial capital receipt, contributing to the Council’s agreed Capital Strategy.
  • Development Potential: The sale will pave the way for a significant development in the city center, enhancing business rates income, increasing footfall, and providing high-quality accommodation.
  • Avoided Costs: Selling the property eliminates future holding costs and risks associated with maintaining a void city center asset.

Historical Context:

  • Previous Marketing: The property was initially marketed in 2020/21, attracting offers for student housing developments comprising 400-500 beds. However, the sale was terminated in Spring 2023 due to the purchaser’s inability to fund the development.
  • Re-Marketing and Current Offers: The property was re-marketed, attracting both conditional and unconditional offers. Given current economic conditions, including increased borrowing costs and reduced financial sector confidence, a conditional offer from an established developer/operator has been recommended for acceptance.

Governance and Delegation:

  • Approval Process: The final Heads of Terms and any necessary amendments will be approved by the Corporate Director for Growth and City Development. Minor agreements required to facilitate the sale will be delegated to the Director of Economic Development & Property.
  • Oversight: Regular communication between Strategic Assets & Property and Legal Services will ensure the sale progresses smoothly, mitigating risks such as delays to the capital receipt and changes to contractual terms.

Implications:

  • Economic Impact: The sale is expected to deliver a quick capital receipt and generate earlier Non-Domestic Rates (NNDR) receipts from the non-residential portion of the development.
  • Financial Stability: This transaction is a strategic move to bolster the Council’s financial stability by converting a void asset into a productive, revenue-generating development.

Comments:

  • Corporate Director: Sajeeda Rose, Corporate Director for Growth & City Development, emphasised the importance of the sale in reducing the Council’s financial burden and fostering city center development.
  • Finance and Legal: Comments from the Finance team and Legal Services are included in the Exempt Appendix to maintain confidentiality.

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