Disposal Strategy
1
Disposal Strategy
Contents
1.
Purpose & objectives
2.
Strategy drivers
3.
Strategy deliverables
4.
Adopted approach & strategy
5.
Ownership of the strategy & corporate governance
6.
Expected benefits & links to corporate objectives
7.
Conclusions
8.
Recommendations
Document Consultation
25/01/10
19/04/10
20/04/10
Corporate Property Group
Asset Management Capital and Investment Group
Document Author
Sally Elliott B.Sc.,M.R.I.C.S., M.B.A. : Asset Management
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Disposal Strategy
1. Purpose & Objectives of the Disposals Strategy
Purpose of the Strategy
The purpose of this strategy is to ensure that BCBC always achieves:
The best disposal outcome
The strategy sits under and supports our Asset Management Plan (AMP)
2021. The AMP 2021 identifies that our property strategy is to rationalise our
portfolio and always to obtain the best outcome to help deliver Council
objectives. This will require balancing the best price reasonably obtainable to
support the Capital Programme and reducing our revenue liabilities against
the benefits being offered through alternative uses.
This disposals strategy works to always achieve the best disposal out come
for BCBC.
BCBC Corporate property vision 2021
Going to:
Starting from:
900+ Assets
including:
400+ buildings
Retain
Invest
and
and
maintain
Remodel
£62m backlog
£15.1m annual
running costs
Lean
Sustainable
Fit for purpose
Delivering the Best
Local Service
in Wales
Release
and
generate
capital
2009
Direction of Travel
2021
Disposal Strategy Objectives
To enable actual and latent capital value tied up in potentially surplus
assets to be realised
To reduce liabilities
Unlock development and regeneration benefits, and
Maximise the proceeds or land use benefit from particular disposals for
the benefit of BCBC and its community including Community Asset
Transfer.
The Disposal strategy is supported by the tools and models contained in the
AMP 2021 including The vacant and surplus property protocols, The
Geographical Review Process, Service Asset Management Plans and the
Community Asset Transfer guidance document.
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Disposal Strategy
2. Strategy Drivers
The Corporate Plan
Supporting delivery of the community themes
Corporate programmes and Directorate service plans and projects
including:
Schools modernisation
Vulnerable children
Active and Healthy living programme (Sports and Recreation Review)
Adult and Healthy living (Adult Social Care)
Customer Care Programme
Sustainable communities - Unlocking regeneration benefits
Efficiencies programme
Office accommodation Strategy
Partnership working/ Shared services
Community Asset Transfer
Partnership working
Fiscal challenges and the operational efficiencies agenda
Funding to support the Capital programme – In particular to fulfil
the requirement to generate additional capital receipts of £3.3m
between 2010/11 and 2012/13 to meet the requirements of the
Council’s capital programme as approved by Council on 10th February
2010.
Releasing Revenue money through efficiencies – releasing ongoing
liabilities.
The requirement for a lean, sustainable estate (AMP 2021)
Legislation and national policy guidance:
Section 123 of the Local Government Act 1972 – Consideration should not
(except with the consent of the Secretary of State) be less than can
reasonably be obtained.
General Disposals Consent 2003 - under the General Disposals Consent
2003 Local authorities can sell or lease general fund assets at less than best
consideration subject to a value limit of £2m in cases where it can
demonstrate and attribute value to wellbeing benefits that would arise.
Quirk Review (DCLG 2007)
Making the Connections (WAG 2004-2009)
3. Strategy Deliverables
Capital Receipts
Income
Reduced Liabilities
Regeneration benefits
Positive Community Asset Transfer and Partnership working
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Disposal Strategy
4. Adopted Approach and Strategy
Due to the diverse nature of our property holdings and legal ownership,
changing service requirements and corporate priorities it is clear that “one
size” will not fit all. Therefore this strategy is necessarily dynamic, focused
around a set of three key inter-relating work strands:
1. Inform, challenge and identify assets for disposal
2. Manage and review
3. Disposal
1. Inform, challenge and identify assets for disposal
Potential disposal opportunities will arise in a number of ways. In order to
maximise these opportunities it is a key element of this strategy that the
Corporate Property Officer and his staff work directly with service providers
and relevant officers to provide targeted, professional property skills in the
following areas:
Corporate Programmes, Directorate Service Plans and Projects –
As identified in the AMP 2021 virtually every programme has a property
impact. This property impact needs to be informed and challenged to
maximise proceeds from land use benefit.
Asset Challenges and Reviews as identified in the AMP 2021 asset
challenge and review tools and processes identify opportunities to
reduce liabilities, realise potential for generation of capital receipts and
community asset transfer and partnerships. The approaches adopted
include:
o
o
o
Geographical Reviews
Service Reviews
Area Asset Management Planning
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Disposal Strategy
Planning
To ensure disposal opportunities and outcomes are maximised:
o
Monitor Planning applications affecting our assets
o
Consider, challenge and submit Local Development Plan and
candidate site applications
o
Master planning involvement
Property Management
Maximising disposal opportunities and outcomes through informing and
challenging on:
o
Requests for variation of covenants
o
Five yearly asset valuation processes (considering development /
alternative uses).
o
Approaches from outside parties. e.g. developers, adjoining
owners.
o
Entering into development partnerships such as asset backed
vehicles or local housing companies.
o
Request from a community group or public body to the transfer of
an asset.
Delivering:
o
Identification of assets for disposal
o
A corporate approach to unlocking disposal opportunities
o
key data on valuation/ market trends
o
Identification of both long-term and immediate development
opportunities including delivery options.
o
Identifying where Property has potential for development or
redevelopment and service can be relocated.
o
Informed Property feasibility studies and option appraisals
o
Considers planning use and challenge to release development
opportunities
o
Maximise grant funding opportunities
o
Informed/ transparent community Asset Transfer
These lists are not exhaustive but form the basis of where many disposal
opportunities may arise.
2. Manage and Review surplus property
The Surplus Property Protocol
Before land and buildings are formally declared surplus, requirements for
use for other authority purposes must be considered through the process
outlined in the surplus property protocol.
Consideration should be given to other local authority services, and
partner agencies where appropriate, as soon as a property is likely to
become surplus.
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Disposal Strategy
Site Investigation and Planning
Once a property has been identified as potentially surplus the Head of
Property and finance should establish whether there are any constraints on
the site including:
Title, legal, planning, statutory authorities, etc.; Early title checks will
often save abortive work later on.
Financial constraints such as the property having been the subject of
funding in the past that necessitates the repayment of grant monies, or
whether the property was purchased by or under the threat of
compulsory purchase, in which case it will need to be established
whether the Crichel Downs rules apply.
Town planning investigations to establish the authorised use and the
potential for valuable alternative use.
Managing the surplus property assets
Prioritising high value, politically sensitive &/or empty buildings
Prioritise delivery of geographical review disposal recommendations
Maintain a log of potential development sites
Maintain a log of potential Community Asset Transfer buildings/ sites.
Protecting value
This may include acquiring properties or releasing restrictions on title to
release additional value.
Managing and maintaining sites to retain value
Market appraisal and master planning:
Monitor and respond to market trends to maximise greatest return
3. Disposal
All disposals should be arranged and managed by the Head of Property and
finance.
Valuations
A valuation of the property for disposal should be undertaken at the earliest
opportunity in the process and continually reviewed through the disposal
process, to ensure delivery of best consideration. Where it is considered
appropriate, for example where negotiations are taking place off market an
independent valuation will be procured.
Method of disposal
Best consideration should always be obtained by the most appropriate
method of disposal.
The method of disposal adopted is dependent upon the individual
characteristics of each case and the benefits to be accrued from the disposal.
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Disposal Strategy
The following is not exhaustive but covers the adopted approaches for various
disposal types:
General Open Market disposals of surplus properties
The most appropriate method of disposal, for the majority of cases, will be
adopted from the following
Private Treaty
Auction
Tender (formal or informal)
Special Purchaser and Sales to former owners under Crichel Down rules
Disposal of non-surplus properties for community regeneration/ partner
initiatives
Examples include disposals for community regeneration schemes by way of
asset backed vehicles.
These cases will be assessed individually as to whether it is recommended
that disposals will
1.
2.
take place at the best price that can be reasonably obtained or
whether prices are to be discounted to achieve the outcomes of the
proposed schemes. In such circumstances appropriately worded
conditions or covenants would be exercised to protect the council’s
interests in the transaction.
Community Asset Transfer (CAT)
Disposal by way of community asset transfer must be in line with the AMP
2021 Community Asset Transfer guidance document.
Essentially such a transfer should only take place if there is community need
and demand, it is supported by a robust business case, the proposal is
sustainable, the proposed use for the property meets the authority’s objectives
and community strategy, there is an agreed time-scale within which a disposal
is expected to be completed and certainty of funding.
5. Ownership of the Strategy & Corporate
Governance
The strategy will be owned by the Corporate Property Group (CPG).
The CPG reports to the Asset Management and Capital Investment Group.
Corporate Governance is provided under BCBC’s current Standing Orders
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Disposal Strategy
6.
Expected Benefits & links to Corporate
Objectives
The strategy will support the process of continuous improvement in asset
management, maximising disposal opportunities to achieve the best disposal
outcome in meeting the challenge of the internal and external drivers and
delivery of “the best local services in Wales”
7.
Conclusions
The utility of the strategy has been reinforced by the work done to date.
Notably circa £12m of capital receipts have been generated over the last 5
years and various assets have been transferred to the community including
over 10 community centres under third sector management.
This Strategy will facilitate the strategic management of BCBC Land and
property to support the corporate objectives by
enabling actual and latent capital value tied up in potentially surplus
assets to be realised
reducing liabilities
unlocking development and regeneration benefits, and
maximising the proceeds or land use benefit from particular disposals for
the benefit of BCBC and its community including Community Asset
Transfer and Partnership Working.
The strategy supports the long term vision of the AMP 2021 and delivery of
“the best local services in Wales”
8.
Recommendations
This disposal strategy is adopted to ensure that the best disposal out come is
always achieved.
The actions arising from the disposal strategy are contained in the AMP
2021 annual Action Plan.
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