SEMLEP WATERSIDE ENTERPRISE ZONE BOARD MEETING Minutes of the meeting held on Monday, 26th March 2018.

PRESENT: Board Ann Limb * Chair of SEMLEP Clive Faine * SEMLEP, Chair of Property Development and Infrastructure Delivery Group Cllr. Jonathan Nunn * Leader, Northampton Borough Council Cllr. Tim Hadland* Northampton Borough Council Paul Walker Northampton Borough Council Rick O’Farrell Northampton Borough Council Stuart McGregor Northampton Borough Council Amy Eyles LGSS Finance Carol Wood LGSS Finance Craig Forsyth Northampton Borough Council Terry Neville * University of Northampton Brian Binley * SEMLEP Board Member

Marina Stafford Northampton Borough Council (Minutes)

APOLOGIES

Mike Todman BEIS Cllr. Andre Gonzalez de Savage * County Council Andrew Parker BIS, Policy Advisor, Cities & Local Growth Unit Andrew Lewer MP, Northampton South Cllr. Matt Golby* Northamptonshire County Council Ed Chapman MHCLG Tom Wells* SEMLEP Board Member Roy Boulton Northamptonshire County Council

* - Board member.

1. Welcome and Introductions AL welcomed everyone to the meeting and introductions were made.

2. Declarations of Interest AL asked if there were any declarations of interest. No financial or non-financial interests were declared.

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3. Apologies Apologies were noted, as above. AL advised that she had chaired the Board since its inception, some seven years previously, and advised that she would be giving this up at the end of the year. AL gave a brief update on LEPs in general, and advised that 16 LEPs had been considered good, with some of the 16 being considered exceptional and that she was pleased to advise that SEMLEP was one of the exceptional LEPs. It is the SEMLEP Board’s intention to be exceptional in everything by the end of the year.

4. Minutes of the Previous Meeting (22nd January 2018) The Minutes of the 22nd January 2018 were agreed as a true record.

5. EZ Projects – Progress and Update Report PW advised that the authority was reviewing how it presented project information to future Board Meetings and that a new format may be in use at the next meeting.

Albion Place The Premier Inn is thinking about expanding, by adding on an additional wing (approx. 50 rooms). Although no formal contact with the authority has been made, the authority are very much aware that Architects have been looking around the site recently.

St James Mill Link Road Progress continues to be made, with LC7 consent finally being received from Network Rail. Sale and Purchase Agreement with solicitors, with completion expected shortly, with the slight complication of Network Rail not being able to put their hands on all of the Title documentation. PW advised that the authority’s solicitors have a way around this situation. BB concerned that he was aware of a Group who wished to see the reinstatement of the Northampton to Bedford line and whether this Group could have an impact on the proposed new road. PW advised that he had been made aware of the Group and that the authority had received enquiries from them. PW advised that the authority were not looking to build over the line, as he understood had happened in other areas. BB requested that the authority make public the nature of the proposed development.

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Action Point: NBC to make public the nature of the proposed development.

(Note: The planning application makes the position clear and is available on the Council’s website).

Northampton Castle Railway Station

PW confirmed that the Chair of the Board and the Leader of the Authority had written to the Secretary of State for Transport in order to bring to the table. PW in process of organising a conference call between Network Rail and West Midlands Trains.

PW advised that there had been a slight disconnect arising from the DfT actions.

AL queried whether a copy of the letter had been sent to Mike Todman as she believed that MT would be able to assist. PW confirmed that he had not sent a copy of the letter to MT, but would do so.

Action Point: PW to send copy of letter to Mike Todman.

St. Peter’s Waterside

PW confirmed that he had communicated with Kier and had advised them that the time was fast approaching when we would need to go our separate ways.

PW met with Kier, Lambert Smith Hampton (LSH) and GVA on Friday, 23rd March 2018.

PW advised that the latest proposal put forward by Kier was for 60,000 sq. ft. office accommodation, a small amount of car parking, storage facilities and drive through Costa Coffee and Burger King.

CF advised that this is a time to say “that’s it”. CF believed that there should be an immediate clean break, with all parties parting happy, if possible.

PW advised that the authority were putting the Board’s wishes into effect and that legal advice was that the authority could terminate the agreement, but would need some form of approval, preferably via delegated powers.

BB acknowledged that the St. Peter’s Waterside site was an iconic site and that that formed an important message that the authority should be giving to the people of Northampton.

AL acknowledged that the authority had the support of the Board and that of the Leader.

BB then queried if anyone had any idea of what was wanted on the site and whether this would be available for the next meeting.

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PW confirmed that further advice was being sought from GVA in respect of viability, with GVA currently running various development options and their report was expected early April.

PW did make the point that before any works commenced, the Victorian Sewer which ran across the site would need to be moved and previously this work had always been considered as being a part of the development.

Anglian Water Authority have advised that to move the sewer would not be a quick job and in order to move things along, the authority were looking to move the sewer straight away and PW queried if the Board felt comfortable with this proposal.

CF advised that the authority had had the Board’s approval for two years, that the authority had money from the WNDC to fund the move.

AL requested that the authority proceed with the movement of the sewer as soon as possible.

Action Point: Relocation of the sewer to be progressed with Anglian Water Authority.

Marketing

CF requested that the expected GVA report be circulated to the Board when it was received, in order for the Board to consider prior to the next Board Meeting.

PW advised that the GVA report was expected early April and that providing GVA were happy for the report to be circulated and provided that all Board Members treated the report as strictly confidential, then PW did not foresee a problem with the request.

Action Point: PW to circulate GVA report providing GVA happy for report to be circulated.

CF then queried when the Architect’s Masterplanning Review would be ready to be circulated.

PW confirmed that the Architect’s had sent through some elements of 15,000 sq. ft. floor plates, but due to the amount of work that GVA were currently doing, these will need to be reviewed by the Architect’s.

AGL enquired if it would be possible, at the next meeting, to have a full discussion on proposals and PW confirmed that the authority should be in a position to set out the options and the way forward at that time.

AL requested that this be noted as an action point for the next meeting.

Action Point: PW to ensure that the authority sets out the options and way forward at the June 2018 meeting. 4 | P a g e

Vulcan Works

Demolition of Amalgamated Tyres has now taken place. The Archaeologists have been on site, but nothing of significant interest found and therefore no delays to works foreseen.

University of Northampton

TN advised that everything was going well and that he, himself, would be moving into the new University site at the end of April. BB requested that the Board congratulate TN and the University for what had been achieved.

HCA (now Homes England)/NHS – Site 2A/2B

CF advised that he understood that the land had been sold for housing, despite CF stressing the importance of the site to Homes England. CF concerned that if the land had been sold for housing, then BRU would be lost and posed the question “is housing an appropriate use for the site”?

PW advised that it was very disappointing that Homes England had not advised the authority directly and that they did not feel able to tell the authority whom the prospective occupier was to be.

BB believed that if housing was given the go ahead on the site, it would put a great deal more pressure on the western side of the town, in particular St. James’ and that it was essential therefore that the St. James Mill Link Road progressed as quickly as possible.

AL requested PW to contact Charles Amies of Homes England to discuss.

Action Point: PW to contact Charles Amies.

Sixfields

Northampton Town Football Club (NTFC) have engaged Wilson Bowden to advise them and the authority is in discussion with them and are in the process of producing Heads of Terms, which would enable NTFC to build retail in front and behind the main stand. It is understood that the retail would be smaller than previously proposed and that NTFC were looking at approx. 80,000 sq. ft. of retail.

PW advised that discussions seemed positive, but that NTFC were proceeding at their own pace. BB advised that the authority needed to put pressure on NTFC, particularly as the Chair of NTFC was due to return to the UK on Thursday, 29th March.

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JN admitted that the authority had concerns regarding the proposed retail element, but were pleased that this was now smaller than had been originally proposed.

PW confirmed that at a recent pre-application meeting, Wilson Bowden had advised that they wanted to ensure that all the necessary research had been thoroughly undertaken in readiness for submitting a planning application.

AL said that the Council should continue to advance progress.

Action Point: PW to continue to develop proposals with NTFC.

CF queried the BRU figure for , as he felt that the financial information provided did not clarify whether this relates to NTFC or the whole area of Sixfields. CF queried whether the information needed to be split into different categories, in order for all to understand more easily.

AE advised that under Future Developments, there was nothing included and that this did not include the Football Club.

£6.6 million was in the BRU model and related to businesses already running in the Sixfields area and that under Future Development for Sixfields, this was showing zero.

AE advised that for 2012 – 2017 over £916,000 income had been already generated from these sites.

Looking at Table C, progress was under review and under Sixfields, there was no forecast.

It was agreed that this discussion would continue later on in the meeting when the Financial Report was discussed.

Westbridge Depot

PW advised he had attended a recent meeting with Veolia, who wish to re- engineer some of the current recycling facilities and by doing so, could create up to 60 new jobs within the EZ.

University – Commercial

TN advised that there had been a lot of recent interest in the commercial development.

Horizon Park

RO’F updated on the Horizon Park site, formerly known as National Grid Site B.

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The site was acquired by the authority, from National Grid, in September 2017.

Horizon House is a locally listed building, with D1 planning permission.

Report going to Cabinet in April 2018 seeking authority to appoint Design Team and proceed to procurement.

Design Team comprises:

RG+P Architects AECOM Project Managers, Principal Designer and Cost Consultant Desco Electrical Engineers Wood Group (Formerly Amec Foster Wheeler) – Civil construction.

RO’F advised that topographical and measured surveys were being undertaken.

NBC had agreed outline Heads of Terms with NPH, subject to some final changes.

BB enquired what sort of piling was to be expected, due to the site’s location to the river.

RO’F advised that at the current time, the authority did not know, as structural surveys were still to be undertaken, but believed that it was highly likely that sleeved piling would be required.

Intrusive site investigations currently being undertaken and that in order to satisfy the requirements of the Environment Agency, it was anticipated that a workshop would need to be undertaken with them, in order to assist the planning process.

With regard to rental income, looking at between £15 - £16 per sq. ft., which would bring in an annual rental of approximately £495,000.

CF queried what the proposed lease term would be. RO’F confirmed that the lease term would be for 40 years, with a break at 10 years, with 5 year reviews and that rent reviews would be undertaken on a five yearly basis.

SM reiterated that the authority were involved in three parts:

1. Investor 2. Subsidiary as tenant 3. Providing a service.

CF believed that the authority were proceeding in the right way, but that he could not comment on the rental level until he was aware of the construction costs.

CF also advised that to achieve a 40 year lease was almost unheard of and that all must be congratulated for achieving this and wished it to be noted that 7 | P a g e

it was very interesting that all had thought through the design of the building to accommodate other potential leaseholders, should the situation change, but queried where this was shown in the BRU.

AE advised that this was moved from Future Sites to Future Developments and that Finance should be able to provide much more detail, once known, in readiness for the June meeting.

6. Financial Model

CW advised that there was now showing a £0.7 million increase in the forecast BRU by site, as No. 1 Angel Square had now been firmed up by the Valuation Office. Due to the agreed work on site forecasts to be completed for the June Board, she was expecting to be reporting additional changes as a result of this work.

Administration Costs

CW confirmed that this area had seen the biggest changes since the previous meeting, as the budget had shown £14.9 million at the January 2018 meeting, but following taking on board CF’s comments made at that meeting, the budget now showed £10.5 million.

PW reiterated that CF had, at the January 2018 meeting, quite correctly, found it difficult to understand how staffing costs could be the same at the end of the EZ. NBC and Finance had undertaken revisions and there was no doubt that this needed to be rethought but bearing in mind what was currently happening at Northamptonshire County Council, it was possible that a local government reorganisation could take place. Therefore in any new proposed structures, it was essential that there was sufficient funding for core EZ staff to ensure that the authority had continuity in order to be able to carry on the necessary work, regardless of the structures.

BB enquired if anyone knew what Government’s view was.

AL believed that this was something that would need to be taken up with Government, that there may be a role for the LEPs in this and that discussions may need to be taken up with Mr Berry, Parliamentary Under Secretary of State, Minister for the Northern Powerhouse and Local Growth, and that this needed to be kept firmly on the agenda and for the authority to drive it, as the Board did not want development to stop.

CW then returned to Appendix B, and advised that at year end Finance would be in a position to advise what the actuals would be for the year end.

In terms of overall BRU, CW advised that this was a fluid figure and that there would always be a slight level of uncertainty due to the time period the model forecasts BRU for. CF believed it was essential that there was a need to identify an optimistic BRU i.e. when it could break even or go into negative.

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Administration and Infrastructure costs required a comprehensive review, as there appeared to be a lot of anomalies, particularly as at the current time no one knew where Four Waterside was going and, in CF’s opinion, one of the main problems was that the financial reporting needed to be more realistic, as he believed that the reporting showed a substantially optimistic view.

AE confirmed that reviews to the model had commenced, but confirmed that there were always refinements and improvements that could be made with a live model.

AE confirmed that the projects labelled ‘C – Future plans/ not complete’ were the riskier projects based on estimates, and as such were separately identifiable and included within the ‘red line’ maximum forecasts.

CF queried the difference between the red line and the blue line, with the BRU model showing that the majority of BRU was from sites that were completed, almost completed and sites already in the EZ, with existing commercial rate income as the base line, so it was not possible to take all of this and cherry pick various bits.

AE responded by explaining that the baseline set by Government in 12/13 on existing business at that point in time, is uplifted every year based on changes to the multiplier, and that all business rates within the EZ is then compared against this figure and reported by NBC through its NNDR3. There can therefore be changes to these ‘baseline businesses’ organically and businesses that enter the EZ without the involvement of this Board that create additional growth and therefore BRU.

CF requested more information around this ‘windfall’ BRU, so that a true picture can be understood.

PW believed it would be useful for Finance, CF and himself to meet to discuss the Finance papers prior to the next board and SM agreed that a better way to inform all was required.

Action Point: Finance, CF and PW to meet prior to the next Board Meeting to discuss Financial Information

BB advised that Sixfields and NTFC would attract an undue amount of publicity, due to the recent well documented background, but that he would appreciate receiving a worst case scenario because things could go wrong and all needed to be aware of what this would mean, should it happen, and requested that all be much less optimistic than previously.

TH advised that Finance used to have three separate financial reports showing the different scenarios.

CF requested that a worst case plan be provided together with accompanying graphs, in order to show all what would be the worst case scenario.

CF referred to Site 1 – Mill and advised that this site was not on the Projects Update List and involved a lot of BRU.

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TH advised that the site was currently used for car boot sales.

CF advised that the Duston Mill site was predicted to generate approximately £4.5 million of BRU and was not even listed on the schedule, that this needed to be reviewed and put on both the Projects Update List and listed independently in the Finance papers, together with the Lidl site which had attracted £7 million of private sector investment, which wasn’t currently showing as a separate site within the BRU model.

7. Risk Register

PW had written to the Chair, prior to the meeting, requested that this item be deferred until the next meeting.

8. Any Other Business

There was no other business discussed.

The Meeting closed at 11.30 a.m.

______Chair, Northampton Waterside EZ Board

______

Date

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