Question
With the slowdown in the global economy, the increasing debt ratio in the UK economy and the risk of a more gloomy economic outlook what plans are WBC making with respect to regeneration funding to significantly reduce council and ratepayer exposure to speculative commercial property developments.
Minutes:
With the slowdown in the global economy, the increasing debt ratio in the UK economy and the risk of a more gloomy economic outlook what plans are WBC making with respect to regeneration funding to significantly reduce Council and ratepayer exposure to speculative commercial property developments?
Answer
Throughout the regeneration process the approach to funding and delivering the scheme has been an important factor in decision making.
Providing value for money is at the heart of all of the Council’s major projects and careful consideration has been given to the risks of investing money against the range of benefits which will be delivered for the town, its residents, workers, visitors and businesses
Benefits such as an improved variety and choice of shops and leisure facilities, improved public spaces and a fantastic town park with a bigger and better play area and services for the community events which make Wokingham a great place to live.
All of these are being delivered through the regeneration and at no cost to the tax payer.
We are confident that the proposals offer a safe investment for the Council and that any costs incurred through building are more than covered by the value of the completed assets, whether that be through selling on the investment to generate a profit, or retaining the scheme to generate ongoing income. The designs have been continually assessed and market tested to ensure this is the case.
Further confidence can be given through the pre-letting of the scheme where we sign agreements with operators to let key units once built. We are in the process of finalising agreements with Premier Inn for the hotel and with two other excellent operators for the foodstore and cinema. Once these have all been signed we will already have guaranteed over 60% of the expected income. This is more than enough income to service any borrowing debt for funding the scheme.
Alongside this we are already being contacted by other businesses interested in taking up units across the regeneration schemes and are confident we will continue to pre-let other units in the scheme at the appropriate times.
I would add, that we have no intention of building anything until we have secured a reasonable number of pre lets; l would also point out that the designs proposed are sufficiently flexible to accommodate any significant changes in retail and the wider commercial demand
We spent over two years working closely with interested private developers to identify the right partner to aid us in regenerating Wokingham, finally selecting Wilson Bowden and David Wilson Homes for their extensive experience in delivering excellent regeneration schemes across the country. David Wilson Homes going on to become a Joint Venture partner in the scheme who will be putting their own money into this development. Not something they would consider doing if they did not have confidence in the Council and the regeneration proposals we are delivering for the town centre.
In your question you refer to this as speculation but I would disagree.
This is the council investing in their local town, its residents, visitors and in its businesses.
This is the Council making sure Wokingham has the facilities to remain one of the best places in the country to live.
To me this is the Council stepping up and taking responsibility for making sure their towns have a long term sustainable future for years to come. Something that council’s across the country should aspire to.