Decision details

Approval of the scope of a strategic delivery partner was sought. Due to supply chain issues and high costs associated with low carbon developments, the Council was facing multiple challenges in delivering projects as seen in the regeneration pipeline. Expertise provided by a procurement partner would help advise the Council on the best use of its assets. Procurement of a single delivery partner, rather than individual development procurement partners would allow the Council to deliver projects more efficiently in terms of cost, outcomes and social value.

Reasons for decision

The Council needed to take a longer-term approach to delivering key strategic projects in the approved Regeneration Pipeline by procuring a suitable partner to work with rather than the multiple single fixed price procurements and one-off relationships. Construction cost inflation had a major impact on the Regeneration Pipeline as bidders built in large elements to cover unknown risk. A longer-term approach would enable the Council to maximise private sector expertise, share risk more equally in a cost-effective way; increase social value and local spend benefits and generate more opportunities for apprenticeships.

Alternative options considered

The alternative option was to continue procuring delivery partners as per current practice.

Resolved:-

(1)   that approval be given to the scope of a Strategic Delivery Partner  for the following:-

·           West Bromwich Masterplan

·           Grove Lane Masterplan

·           Rolfe Street Masterplan (subject to Cabinet approval)

·           Delivery of the Housing Revenue Account Council Home Newbuild programme (All sites and to include MMC)

·           Transport Pipeline – three CRSTS Schemes (Birmingham to Smethwick Inclusive Growth Corridor; A4123: Multi Modal; A461: Multi Modal totalling circa £40m)

·           Delivery of all Retrofit programmes in HRA homes

·           Asset Rationalisation and Surplus Assets

·           Other Residential Sites – some or all of the Friar Park Masterplan site; Council owned sites suitable for residential development.

·           Tipton Town Regeneration Scheme

·           Regeneration Sites in proposed Sandwell Levelling Up Zone (Wednesbury to Birmingham Rd, Tipton) – subject to approval

·           Other projects added to the Pipeline as determined by Cabinet

(2)   that approval be given to authorise the Director of Regeneration and Growth to accept a contract period of up to 15 years with break points at three, seven, ten and fifteen years for a long-term partnership subject to value for money and acceptable performance;

(3)   that the Director of Regeneration and Growth be authorised to commence a Pagabo Framework procurement process for a Strategic Delivery Partner;

(4)   that the Director of Regeneration and Growth is authorised to award a contract for the procurement of external legal advisers from existing budgets to advise on the procurement, the contract documentation and drafting of Joint Venture legal agreements and structures in connection with Resolution (1) above;

(5)   that in connection with Resolution (1) above, the Director of Regeneration and Growth be  authorised to procure a commercial adviser from existing budgets to advise on the procurement, the proposed partnership and Joint Venture agreements as appropriate;

(6)   that details of the risks in relation to the procurement and the delivery partner of this approach be received;

(7)   that the Director of Regeneration and Growth submit a further report in 2024, after the Pagabo procurement process has completed, to determine which Strategic Delivery Partner should be selected and any other issues requiring Cabinet approval.