Agenda item

To approve the asset transfer of The Bridge, Tipton, to Murray Hall Community Trust on the basis of a full repairing lease for 99 years with a rental of £1 pa for the purpose of a multi-purpose community facility and office space.

Agreed:-

1.1    That approval be given to the asset transfer of The Bridge, Tipton, to Murray Hall Community Trust on the basis of a full repairing lease for 99 years with a rental of £1 pa for the purpose of a multi purpose community facility and office space.

1.2    That the Director Law and Governance and Monitoring Officer be authorised to enter into or execute under seal if necessary, a formal lease for The Bridge Tipton.

Approval was sought for the asset transfer of The Bridge, Tipton, to Murray Hall Community Trust on the basis of a full repairing lease for 99 years with a rental of £1 pa for the purpose of a multi-purpose community facility and office space.

The Chair of the Budget and Corporate Scrutiny Management Board sought clarification on what steps the Council was taking to ensure a single and consistent approach to asset transfer and the granting of voluntary sector leases. A request was also made to clarify what break clauses would be included in the proposed 99 year agreement.

It was confirmed that a standardised suite of documents had been introduced for voluntary sector applicants to complete. Following assessment of the application by a range of officers, a comprehensive report would be prepared for the Investing in the Voluntary Sector Strategic Group to ensure consistency of approach. The matter would only progress if the Strategic Group endorsed the proposals and financial analysis.

A revised Community Asset Transfer Strategy for SMBC would be progressed and implemented over the course of 2023 through the appropriate governance process with input from the Homes and Communities Team along with other relevant stakeholders.

This strategy was intended to sit alongside and compliment the Land and Asset Disposal Protocol. The strategy would centre around Community Asset Transfer as a property disposal option (not just for current community buildings but any property declared surplus where this would be suitable) and was intended to act as a supportive guidance document for prospective applicants rather than a 'formal' policy.  It would provide a comprehensive overview to what a CAT entailed through a successful partnership approach that ensured any property transfer was sustainable.

The 99-year lease would not include a break option. As part of the transfer the council would require the lessee to have full repairing liability for the building. The lessee would be better placed to procure funding to maintain and improve the premises, but the inclusion of a break clause would deter funders from progressing applications as there would be no security of their tenure for their investment.

The lessee would be required to sign an agreed statement setting out their outputs and deliveries in return for a peppercorn rental.

The statement would be reviewed regularly, and the lease would reserve the right to revert to a market rental if the lessee failed to adhere to the agreed statement or to agree new outputs and deliverables.

Reasons for recommendations

Murray Hall Community Trust (MHCT) was a well-established anchor organisation, with a presence in Sandwell since 1994. They were locally-led and deeply rooted in the community. They had strong partnerships with the council and with other voluntary and community groups and had taken a community development approach to all aspects of their work (responding to service users views, enabling people to do more for themselves). They had already demonstrated their ability to attract capital funding and manage complex refurbishment projects in the initial phases of transformation of the building.

The proposed asset transfer accorded with the principles set out in the strategy where Strategic Assets & Land would proactively lead discussions with community groups about the possibility of undertaking Community Asset Transfers. Transfers would be undertaken in accordance with the Council’s policy on Community Asset Transfers. They would only happen if officers were satisfied that a clear sustainable plan was in place to maintain the asset and that further calls on the Council for support were unlikely.

Alternative options considered

Do nothing – MHCT had a 30-year rent free, full repairing voluntary body lease, expiring in 2043. This would not signal to the wider voluntary and community sector that the Council value their contribution as partners. The asset transfer was a positive tool for enabling the development of enterprising and sustainable organisations with a long-term stake in the area. Furthermore, it would undermine the business case that MHCT needed to develop in order to complete the refurbishment.

Agreed:-

(1)     that approval be given to the asset transfer of The Bridge, Tipton, to Murray Hall Community Trust on the basis of a full repairing lease for 99 years with a rental of £1 pa for the purpose of a multi-purpose community facility and office space;

(2)     that the Director Law and Governance and Monitoring Officer be authorised to enter into or execute under seal if necessary, a formal lease for The Bridge Tipton.