Part 1 ITEM NO. ___________________________________________________________________

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Part 1
ITEM NO.
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REPORT OF THE STRATEGIC DIRECTOR FOR SUSTAINABLE REGENERATION
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TO THE LEAD MEMBER FOR HOUSING ON
18th JULY 2011
TO THE LEAD MEMBER FOR PROPERTY ON
12th JULY 2011
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TITLE: STRATEGY FOR DEALING WITH SALFORD CITY COUNCIL’S SHOP
ASSETS AND ASSOCIATED ACCOMMODATION.
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RECOMMENDATIONS:
That both Lead Members approve the following approach to the ongoing
management of shops and associated accommodation as per the attached action
plan:
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Where blocks have been identified for demolition, only essential health and
safety related repairs will be carried out;
Opportunities for community usage will be explored where there is no
demand for shop units, but where they are integral to residential blocks;
Where shops are sustainable, options for improvement works will be
considered;
Potential development opportunities will be considered where this is
feasible; and
Individual decisions on each shop or parade of shops will be submitted for
further Lead Member approval.
EXECUTIVE SUMMARY:
In April 2005 a review of the Council’s management of shop units, undertaken by
Plus Group, was reported to Housing Lead Member. Following this, Urban Vision
was commissioned to undertake a review of the physical condition and commercial
viability of the shopping parades, and to propose recommendations for the future
management of the assets. The review undertook and considered the following:
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Shop condition survey;
Review of rents and arrears;
Maintenance costs;
Commercial viability;
Future recommendations; and
Disability Discrimination Act (DDA) compliance.
The completed report was signed off by the Associate Director of Property Services
and received by Housing Services in 2006. A Lead Member report was drafted and
circulated seeking approval for the recommendations made within Urban Vision’s
report.
Following a stakeholder challenge session the comments and recommendations for
each shopping parade were developed into a report and it was felt that a number of
additional considerations should have been included in the review. To summarise,
these covered:
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Consultation with area offices and New Deal for Communities / Housing
Market Renewal teams;
Reference to existing planning data and surveys;
Additional categories for recommendations to account for regeneration areas;
Value of anticipated capital returns on disposals to assist decision making;
and
Catchment area of parades.
As such the report was not submitted to Lead Member, and it was agreed that the
Shops Review should be reviewed, taking into account the comments obtained from
the challenge sessions.
As part of the Section 27 agreement between Salford City Council and Salix Homes,
responsibility for the management of non-dwelling assets, which includes shops and
garages, was designated as a function for Salix Homes, although commissioning
works remained as the responsibility of the Council.
Currently the commercial aspect of the parades (as opposed to any associated
residential) is managed by Urban Vision and through their management fee. There
are no specific investment proposals for any of the parades and no budget other
than minor responsive repairs. Prior to let, repairs are generally dealt with by
offering rent free periods.
Salix Homes, in conjunction with Urban Vision, have developed an action plan for all
of the shops within the Salix Homes management area, and representatives of both
organisations meet on a regular basis to update on progress and discuss further
proposals. The action plan is attached as Appendix A of this report.
Whilst there is no specific budget available for investment in the shops, a number of
options are being considered that may lever in potential funding or that tie in to other
capital investment programmes.
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Current options being explored include:
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Community use;
Refurbishment as part of improvement programmes (high rise blocks);
Potential development opportunities; and
Disposal via auction.
A full action plan providing details of proposals is included in Appendix A.
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BACKGROUND DOCUMENTS: Appendix A – Strategic Action Plan
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KEY DECISION:
Yes
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DETAILS: See Executive Summary
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KEY COUNCIL POLICIES:
Salford’s Housing Strategy; and
Asset Management Plan
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EQUALITY IMPACT ASSESSMENT AND IMPLICATIONS:
Full equality impact assessments have been carried out on the Salix Homes
Investment and Asset Management strategy and actions identified through the
service action planning process.
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ASSESSMENT OF RISK: Low
Risk: Limited availability of resources to maintain the assets in the longer term.
Mitigation: The range of different options being considered, including disposal and
offering rent-free periods to lessees to enable them to invest in properties, should
ensure effective management of the assets.
Risk: Damage to reputation of organisations through properties being empty.
Mitigation: Salix Homes and Urban Vision will seek to minimise the number of empty
shop units through effective marketing of vacant premises, handing empty units over
to the community in certain situations where shops are not viable, and progressing
with demolition where properties fall within areas of planned redevelopment.
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SOURCE OF FUNDING:
Approximately £28,000 provided to Urban Vision to carry out responsive repairs.
LEGAL IMPLICATIONS:
Norman Perry, Legal Services – while the basic suggestions are sensible and seem
fine, Salix Homes and Urban Vision need to take care that the covenant for “Quiet
Enjoyment” is not breached. Quite simply that means that whatever we have
covenanted to do under the Lease, we must do. If we have covenanted to keep the
structure in good repair, then that is what we must do. We would be in breach of our
overall covenant for Quiet Enjoyment if the property fell into disrepair to an extent
which affected the Tenant’s use of the property.
There needs to be a good deal of common sense in the approach to be taken,
always being aware of the obligations under the Lease. However it would be
unreasonable to expect the Council, Salix Homes or Urban Vision to undertake a
great deal of expenditure on a property which would shortly be due for demolition.
There may however need to be a small amount of expenditure to avoid being in
breach.
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FINANCIAL IMPLICATIONS:
Steve Bayley, Group Accountant (Sustainable Regeneration) – there are currently no
specific budgets available for investment in the shops. Any investment proposals will
need to utilise existing budgets and be considered on an individual project basis.
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OTHER DIRECTORATES CONSULTED:
None
CONTACT OFFICER:
Matt Roberts
Tel No: 0161 779 8886
E-mail: [email protected]
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WARD (S) TO WHICH REPORT RELATE (S):
All Central Salford wards
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Appendix A - Salix
Shops Strategic Action Plan.xls
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