Agenda item

Report attached.

Members considered a report of Councillor Clare Pritchard, Portfolio Holder for Transformation and Town Centres, updating Cabinet on the Levelling Up funded (LUF) town centre projects.

Councillor Pritchard provided a brief introduction to the report, outlining the Phase 1 works that had been undertaken, the contractor procurement process for Phase 2 and the on-going works.  She also referred to the additional works being undertaken to finish of the exterior of the Market Hall and its anticipated completion date in mid-July.  Burton’s Chambers was likely to be competed first, but the Council had asked the contractors to prioritise work on the Market Hall, where possible.  A job advertisement had recently gone out for a Town Centre Venues Manager.  In addition, representatives from the Ministry of Housing, Communities and Local Government (MHCLG) had visited the Town Centre sites and made some positive comments.  They were hoping to use this project in a case study to showcase best practice.

Councillor Zak Khan noted the planned opening date for the Market Hall in November 2026 and asked what the additional costs would be to the Council of operating the venue in-house.  Councillor Pritchard indicated that there should be no additional cost to the Council.  Councillor Whitehead added that use of an external operator might well have cost more.

Approval of the report was not deemed a key decision.

Reasons for Decision

The Levelling Up Fund had been announced at the 2020 Government Spending Review.  Its focus was on capital investment in local infrastructure projects that required up to £20m of funding and built on prior programmes such as the ‘Local Growth Fund’ and ‘Towns Fund’.

In January 2022, Cabinet had given its formal approval in support of the Town Centre Stakeholder Board’s recommendations that the Council’s LUF submission should focus around the following three principal interventions, noting that at the time 2 and 3 were not in the Council’s ownership.

1.      Redevelopment within the Indoor Market Hall and removal of the outdoor pavilions along Peel Street to provide an enhanced food and drink offering alongside traditional market stalls and new leisure offering – the intervention known as Market Hall.

2. Acquisition and external façade improvements/roof repairs to the properties of 43-59 Blackburn Road / 2-4 Church Street – the intervention known as Market Chambers.

3. Acquisition and redevelopment to the block 61-69 Blackburn Road to provide for a shared workspace offering – the intervention known as Burtons Chambers.

Acquisitions

Market Chambers - In total, six freehold and twenty-five leasehold interests had been acquired across the properties 2-4 Church Street and 43-59 Blackburn Road.  The first had been secured in August 2023 and the last in July 2025.  A General Vesting Declaration had been made by the Council on the 10^th February 2026 and notices had been posted around the property subsequent to the confirmation of the Compulsory Purchase Order by the Inspector.  Following a 3-month notice period, the Council would register the acquired land as a single title with the Land Registry.

Phase 1 construction contract

All works procured under the phase 1 contract were complete and the small number of defects identified by the phase 2 contractor had been resolved by the phase 1 contractor and their subcontractors.

Phase 2 construction contract (fit-out)

The following work headings were instructed:

• Full internal fit-out works to Market Hall and Burtons Chambers, such as floors, walls, ceilings, electrical, mechanical and ventilation systems, decorations, fixtures/fittings etc.
• Installation of a new damp proof protection system to two elevations in Burtons Chambers which were below the external ground level.
• Re-covering to the roof of Burtons Chambers.
• Further replacement of roof glazing, guttering and safety walkway to the Market Hall roof.
• Installation of a Solar Photovoltaic system to the Market Hall roof including any repairs to the existing covering.
• External public realm works to Peel Street (reduced scope from the original approved planning application, following extensive surveys which identified the proximity/quantity of utility services and river culvert).

Additional works had been identified as the project had progressed - these being additional asbestos removal, make secure existing floor joists and additional weatherproofing details to roof glazing.  Whilst it had been necessary to instruct this work under the phase 2 contract, these costs were being managed within the overall approved budget.

There was no LUF funded work planned to the remaining leaseholder’s ground floor external façade in Burtons Chambers, although designs had been future proofed as far as possible to enable the space to be incorporated, the curtain walling system/windows and internal services extended into the redeveloped workspace if/when it became vacant and the Council wished.

Monitoring / Reporting

The quarterly reporting requirement to MHCLG had changed.  The Council was now required to report progress every six months, starting from April 2026 and the spending deadline had been extended, from 31^st March 2026 to 31^st March 2028.

The phase 2 contractor’s most recent progress report had highlighted seventeen different contractors on the project.  Of these, seven had head offices in the Merseyside area, four in Greater Manchester, two in Cheshire/North Wales, two in West Yorkshire and one in Lancashire.  Whilst there were no contractors registered address in Hyndburn, twelve operatives working on site lived within postcodes BB3, BB4, BB5 and BB12.

Budget

At the end of the phase 1 contract, the project cost consultants and Council finance team had reported £14,336,357 expenditure against £25,416,516 of available funding (£20,000,000 LUF funding, £3,916,516 from Hyndburn Borough Council and £1,500,000 of match funding from Lancashire County Council).  This provided a remaining approved budget of £11,080,159 for phase 2 works (plus a separate client contingency of £500,000). At the time of writing the report, the latest cost report produced by the Council’s consultants Rihbell and Rider Levett Bucknall, currently estimated an overall phase 2 cost of £11,129,503, which would be a £49,344 overspend and less than 2% of the approved budget.  However, there were still twenty-two outstanding Provisional Sums yet to be agreed and instructed.  These had a tender estimated contract value circa £1.3m so the overall phase 2 cost could still fluctuate upwards or downwards.  The project team and phase 2 contractor were working to have these works agreed and the prices fixed within the coming month.

Programme

At the time of writing the report, the contractor’s programme still showed a working assumption that the construction works to Burtons Chambers would be ‘practically complete’ by 6^th July 2026 and Market Hall by 13^th July 2026 (RIBA 6 – Handover).

Following the change to leasing the Market Hall, where the Council would now manage the Market Hall day-to-day operations, there was a substantial amount of work for the Council to undertake in promoting and signing up new food and drink traders plus any other general market type traders to complement the existing traders temporarily decanted to the town square.  The Head of Policy and Communications, who was not part of the existing LUF project team, had been asked to lead this work to ensure the Market Hall opened successfully.

Given the time required to secure new tenants and recant the traders from the temporary cabins, it had been agreed that the Market Hall re-opening would align with the Christmas Lights Switch On events, on either the 19^th or 20^th November 2026 (the exact day would be agreed nearer the time with market traders).  The Council continued to liaise closely with the Burtons Chambers operator to understand the work/timescale they required for testing or any soft launching, but the operator had agreed to open in line with the Market Hall as the temporary cabins would need to have been removed from in front the building’s entrance (RIBA 7 – Use).

There were no alternative options for consideration or reasons.

Resolved                                   –   That the Cabinet note the progress update as set out in this report.