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'Community Hub' Viability Report

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'Community Hub' Viability Report Charing Palace ‘Community Hub’ Viability Report Charing Palace Trust 30 October 2018 Charing Palace Viability Contents 1 Introduction 3 2 Background and Context 4 2.1 Preferred ‘Community Hub’ Option (2016/17) 4 2.2 CPT have no legal entitlement 4 2.3 Current assumptions regarding the Spitalfields Trust 5 2.4 Kent County Council: Charing Library 5 2.5 Charing Parish Council: Parish Hall 6 2.6 St Peter & St Paul Church: Church Barn 7 3 Governance and Management Arrangements 8 3.1 Development 8 3.2 Operation 8 4 Capital Cost Appraisal 10 4.1 Options: Summary Capital Costs & Funding 10 4.2 Impact of Varying the Scale of Enabling Development 10 4.3 Capital Costs 11 4.4 Capital Funding 14 5 Revenue (Operational) Appraisal 16 5.1 Options: Summary Operational Financials 16 5.2 Operational Functions, Relationships & Responsibilities 18 5.3 Operational Income 18 5.4 Operational Expenditure 27 Appendices 1 Consultees 30 2 Market Analysis 31 2.1 Average Residential Values for TN27 Postcode estimated by Zoopla 31 2.2 Comparator rates for short-term residential tenancies 31 2.3 Comparator rates for accommodation near Charing 31 2.4 Available workspace in Ashford and rates 36 2.5 Workspace case studies in Ashford Borough Council 37 3 Ashford Tourism Trends 41 Fourth Street Place Consultants Ltd, 407 The Print Rooms, 164-180 Union Street, London, SE1 0LH www.fourth-street.com 2 Charing Palace Viability 1 Introduction Fourth Street was commissioned in March 2018 by the Charing Palace Trust to advise on the financial viability of the Charing Palace Community Hub project. The work has been supported by the following: ➢ Site visits to Charing and various sites and attractions in and around the area; ➢ Meetings with the Charing Palace Trustees and the appointed project manager and mentor; ➢ Consultations with a variety of local businesses and stakeholders (see Appendix 1); ➢ Market research to assess the viability of individual uses forming part of the community hub option; ➢ Update of the spatial brief for the community hub option; and ➢ Construction of a financial model to assess the financial viability (capital, funding and operations). This report follows on from previous studies (summarised in section 2.1 below) and provides a further stepping-stone in the development planning process for the Archbishop’s Palace complex in Charing. As such, this report is not intended to be a final and conclusive study on viability but rather, to inform a necessary and subsequent Project Scoping Study that will build on its considerations and assumptions, and layer in further detail and refinement of options, relevant to this stage of development planning and informed by other comparator projects. 3 Charing Palace Viability 2 Background and Context 2.1 Preferred ‘Community Hub’ Option (2016/17) A series of reports1 were published during 2016 and 2017 relating to the strategic review of options for the Charing Palace site, commissioned by Ashford Borough Council and supported by Historic England. The assessments and options considered in these reports were presented and discussed at two public meetings in Charing. The option which promoted the concept of a ‘community hub’ was favoured and encouraged the formation of the Charing Palace Trust2 in June 2017. At the time, the ‘community hub’ option was relatively fluid in its definition and included consideration of: ➢ Refurbishing and converting the Archbishop’s Apartments as workspace (with an option suggested for converting it into accommodation to link with a possible restaurant in the Great Hall); ➢ Converting the Great Hall, and with a possible extension ranging from 85sq.m to 450sq.m, that could include: Community cinema with 2 screens; Bistro / bar / coffee shop, including large outdoor seating area; Large flexible function room; One or more boardroom style meeting rooms; Library, with village archive centre and small exhibition about the history of Charing Palace; outside children’s play area. ➢ Creating a new access road from Pett Lane to the Great Hall with parking set along its length and in the area immediately to the east of the Great Hall. Overflow parking would be provided in the North Paddock. ➢ Restoration of the western range of accommodation as residential; ➢ Enabling residential development on the western side of the site – with a variety of configurations and scale; and The concept3 for creating a community garden in the paddock immediately to the north of the Great Hall was subsequently added. 2.2 CPT have no legal entitlement It is important to note that at the time of this report the Charing Palace Trust do not have any legal entitlement to any of the buildings or land that make up the Charing Palace site. It should be noted however that without the letter from Spitalfields Trust to CPT, dated 14th April 2017, grant funding from 1 Strategic Review of Options, Drury McPherson Partnership, March 2017; Options For Charing Palace, Possible Uses and Viability, Colliers International, May 2016 and updated May 2017; (with contributions from (contributors: Thomas Ford Partnership, D.R. Nolans & Co, Swale and Thames Survey Company) 2 Charitable Incorporated Organisation, Charity Number: 1173293 3 Idea conceived by Terry Whitbread 4 Charing Palace Viability the Heritage Lottery Fund and Architectural Heritage Fund to undertake the Viability Study and Scoping Report would not have been forthcoming. The majority of the site remains in the freehold ownership of Brenda Ansell. 2.3 Current assumptions regarding the Spitalfields Trust The Spitalfields Trust (ST) have an Option to acquire the Palace site and buildings from the current owner. This option is understood to expire in June 2018, although the Spitalfields Trust have indicated that they have secured an extension to this. The Spitalfields Trust have exercised the Option in acquiring the southern range of buildings and completed the refurbishment of No. 2 Cottages in 2017, which has since been sold into private ownership. They are in the process of restoring the Gatehouse and have indicated to CPT that following completion they will focus on planning and architectural work for the next stage, and this may take several years, and they will then continue restoration work on a rolling basis. Spitalfields Trust recognise that the restoration of the Great Hall will be a challenge for them and have asked how CPT would use it, suggesting a new Village Hall would be a possibility. Taking this into account, there appears to be two principal options to be considered in this viability assessment. ➢ Firstly, the assumption that the Spitalfields Trust continue their development efforts on the rolling basis, leaving only the Great Hall to the Charing Palace Trust, along with lands necessary to support its development and operation. In this option, it is assumed that any surplus generated from the private sale of refurbished properties will be retained by the Spitalfields Trust and, in line with their objects, invested into subsequent conservation projects. ➢ Secondly, Spitalfields Trust refurbish the western range of buildings (having completed and sold the Gatehouse) and come to an agreement with CPT that the Apartments together with the Great Hall can be released for the ‘community hub’ project; again, together with sufficient land to support its development and operation. Based on the latest dialogue between ST and CPT, the second of these options is considered the least likely at this stage and carries with it significant additional risk and uncertainty but provides the greatest prospect of long-term operational viability (assuming there are no additional financing costs for delivering the Apartments). From a conservation and access perspective, CPT’s favoured option would be to unite the Apartments and Great Hall for the purposes of the community hub. This paper assesses the financial viability of these two distinct options. 2.4 Kent County Council: Charing Library Charing library is located on Market Place, adjacent to the Palace site. 5 Charing Palace Viability Kent County Council who own and operate the library have indicated their interest in relocating the library into an integrated community hub. This is consistent with KCC’s current policy and a Libraries, Registrations and Archives strategy is currently in development, which will promote such change. The current library extends to 128sq.m in total including public and back of house areas. KCC have indicated that the front of house areas could be reduced substantially to around 80sq.m, with support functions being shared with other community hub activities. The library currently opens for 18hrs a week and is staffed by one employee and activities are run by volunteers and third-party organisations. There are 636 active borrowers, most of which are assumed to originate from Charing itself. On average, it attracts 7.7 visits and 14.8 items borrowed per hour of opening. The library hosts 113 events across the year – mostly children’s activities such as, storytelling, baby bouncing and talk time. If the Charing library function were to be integrated into the community hub, the current library building would become redundant. It is assumed that this would be redeveloped, and the capital receipt contributed towards the refurbishment costs of the community hub and the relocated library more specifically. As an operating baseline, it is assumed that the integrated library would be open for at least the same number of hours per week as the existing library. However, with the co-location of other services and activities within the community hub, it is likely that the opening hours could be extended through the more efficient staffing and operational regime. 2.5 Charing Parish Council: Parish Hall Charing has several facilities across the village that provide space for the community and private hire including, the Parish Hall, the Sports Pavilion, the Church Barn and the Methodist Church Hall.
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