Tuesday 12 November 2024
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Nottingham

Nottingham City Council announces Falcon Supermarket building sale

Nottingham City Council has confirmed the decision to sell the property at 135 Carlton Road, known as Falcon Supermarket, in a bid to alleviate its significant budgetary pressures and ensure the efficient management of its asset portfolio.

The decision affects the building and not the popular supermarket business which continues to trade as normal.

The property has been declared surplus to requirements as part of a larger asset rationalisation programme aimed at tackling the Council’s ongoing financial crisis.

The move to dispose of Falcon Supermarket follows Nottingham City Council’s financial challenges, with a projected budget shortfall of over £50 million for the financial year 2024/25. Like many local councils across the UK, Nottingham has faced escalating costs driven by increased demand for services such as children’s and adults’ social care, as well as rising levels of homelessness. Inflation has only exacerbated these pressures, making the financial landscape even more precarious.

In response, the Council has planned to achieve over £36 million in savings between 2024 and 2028, whilst also relying on government-granted Exceptional Financial Support (EFS) of up to £66.143 million. The EFS consists of £25 million for 2023/24 and £41.143 million for 2024/25. This funding, however, is not an additional financial windfall but rather allows the Council to utilise capital resources from asset sales to cover essential service costs. Therefore, the sale of properties such as Falcon Supermarket forms a critical part of Nottingham City Council’s wider Improvement Plan and Budget Strategy for 2024.

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Falcon Supermarket, located in the St Ann’s ward at 135 Carlton Road, Nottingham, NG3 2FN, is a property in a secondary retail location.

Currently, the property is let on a long lease at a peppercorn rental, with a remaining term of 55 years. The Council noted that the property is non-compliant with current Energy Performance Certificate (EPC) standards, and by 2027, it will no longer meet new energy efficiency regulations. Achieving compliance would require considerable capital expenditure, and with no strategic requirement to retain the property, the Council has opted for disposal rather than investment.

The decision document outlines the risks associated with retaining the property. The Council would be faced with rising maintenance and compliance costs, in addition to foregone potential capital receipts. With limited opportunities for a proactive asset management approach to materially enhance the property, retaining Falcon Supermarket would likely be an inefficient use of Council resources. As a result, the option to do nothing and retain the asset was ruled out in favour of pursuing an early disposal.

View document relating to this decision. 

The property will be marketed in line with the Council’s adopted Disposals Policy, and the sale is expected to take place via auction to ensure a timely and efficient transaction. An auction process has been identified as providing increased certainty, allowing the Council to secure disposal within a defined timeframe, which will be conducted on an unconditional basis. The Council aims to market the property effectively to ensure sufficient exposure and generate interest among prospective purchasers, particularly targeting segments of the market that are likely to be interested in properties of this type.

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