Agenda item

4.1  The committee went into closed session in order to consider this item.

4.2  The head of property introduced the report.  In response to members’ questions about the termination provisions he explained that the cooperation agreement remained in place until a development agreement was entered into.  He also gave clarification of the development funding interest rate.  Members were of the view that this was not sufficiently clear in the report.

4.3  In response to further questions the head of property confirmed that the council would have a say in selecting any investment management company if the completed development were sold.  The council would also have a challenge option if it took the view that Berkeley Homes (BH) was not selling properties at the maximum possible value.

4.4  Members were concerned that BH would be able to raise the security referred to at paragraph 40 of the report.  The head of property said that the council was confident that the security could be realised if necessary.  He also confirmed that a performance payment to BH had been agreed based on end sale values of the residential element.  This would be taken as a priority payment from the development account based on sales values once the criteria had been met.  The head of property also confirmed that the council had agreed to share costs of developing the planning consent 50/50 with BH (paragraph 57).  These costs would be excluded from the development agreement.

4.5  Members queried paragraph 30 of the report, in terms of capping on the residential element of the scheme on sales over an upper limit.  The head of property clarified that this was on residential sales only.

4.6  In response to members’ questions on the extent of delegation, the chief executive emphasised that any substantial variations would not be within her delegated authority and would need to be considered by the executive.  Decisions taken within the delegated authority would be backed by the usual formal documentation.

4.7  The committee asked that the executive receive clarification/fuller information on the development funding interest rate and the security BH will provide to enable the council to step into the scheme in the event of default by BH.