Agenda item

Report attached.

The following item was submitted as urgent business with the Chair’s agreement in accordance with Section 100B(4) of the Local Government Act 1972, the reason being to confirm details of the lease renewal.

The Deputy Leader of the Council reported on behalf of the Portfolio holder for Housing and Regenerationwho had submitted a report to seek Cabinet approval to accept the surrender of the existing lease of St James Old SchoolBuilding, Cannon Street, Accrington from Hyndburn Voluntary & Community ResourceCentre Ltd (HVCRC) and provide them with a new 25 year lease.

Approval of the report was not deemed a key decision.

Reasons for Decision

(HVCRC) currently hold a lease of the premises which is due to expire on 18^th September 2024. (HVCRC) have requested a new 25 year lease on similar terms to the existing lease to satisfy conditions required in relation to a grant of  £165,708 from the Reaching Communities - Buildings  Big Lottery Fund (BLF). This lease will facilitate HVCRC being able to satisfy conditions of the offer from BLF by providing to BLF a completed Certificate of title from their solicitor and a completed Deed of dedication and evidence that they have registered a restriction on the title of the land and buildings.

The offer of the grant of £165,708 from BLF has been made to the HVCRC in an offer letter dated 24^th April 2018. HVCRC will be expected to deliver building works will provide new modern and accessible facilities including  new kitchens and toilets, redecoration and replacement of internal doors throughout, in addition to an automated door entry system at the main entrance of the building. This work aims to increase the number of activities and services and number of people attending them who are elderly, disabled and indeed all members of the community, thus improving community cohesion, health and wellbeing and reduce social exclusion.

The original lease of the building was granted for a term of 7 years less one day from 20^th September 2004. The replacement lease was for a term of 3 years to 19^th September 2014. The current lease is for a period of 10 years from 19^th September 2014. All previous leases including the current one were granted subject to the tenant paying a nominal peppercorn rental.

The lease will include a user clause which stipulates that the building should be used as a community resource centre in accordance with the tenant company’s charitable objectives.

The building is currently used by a range of organisations delivering key services to a

diverse range of groups and clients with over 300 people visiting the site weekly. A range of social activities take place including Yoga, dance and fitness classes available to young and old both during the day and in the evenings. The centre also hosts the Red Rose Recovery  and Smart Recovery Circle. Both groups work with vulnerable members of the community in helping them deal with addictions, behavioural issues, encourage self development and rebuild self esteem and confidence. They provide help and support through activities and  training and the groups work with multi-agencies to  aid recovery, reduce dependency on drugs and  alcohol.

The grant offer is conditional on BLF approving a Capital Delivery Plan and  Business Plan which is currently work in progress by HVCRC and entering into a lease with the Council and this has been suggested by the BLF to be a term of 25 years.

The lease will include a full repair and maintenance clause and, as such, it is expected that income derived from the activities will be reinvested into the building for maintenance and repairs, including those identified in a recent condition survey of the building and are not dependant on HVCRC receiving the grant from BLF. In 2017 HVCRC reported to BLF a surplus £29,018.

The tenant will, in accordance with the lease, be expected to ensure they comply will all relevant legislation whilst in occupation and provide the Council as Landlord with evidence of that compliance. 

Alternative Options Considered and Reasons for Rejection

The building could be used as offices with a potential annual rental income of £25,000, however there is currently a surplus of office accommodation in the Borough therefore this income is not guaranteed.

If an alternative use were to be supported, the Council would need to bring the current lease to an end by serving the appropriate notice. It would then need to advertise the building available to let or for sale. There is already a surplus of vacant buildings in the town centre and this supports the Council’s policy to transfer under used assets to suitable community groups where this is possible.

The building could be opened up to other community groups but the Council has not been approached by others to manage this building.

The new 25 year lease is a prerequisite of the HLF providing £160,000 to HVCRC which will be used to upgrade the building and facilities. Not providing the lease will jeopardise this funding opportunity  and HVCRC are unlikely to be able to afford to carry out these improvements. This does not negate their liabilities under the terms of the lease to carry repairs and maintenance of the site.

Resolved                               -   That Cabinet approved the surrender of the current 10 year lease and grants a new 25 year lease to Hyndburn Voluntary and Community Centre Ltd at a nil rental on the basis that, having considered part 3 of the report, Cabinet is satisfied that the proposed usage of the building will continue to promote the social, economic and environmental wellbeing of the Borough.