Well, we have finally got the details of the Old Gaol Deal with Cranbourne Homes!
Many thanks to Peter Beer for sending this through. Below you will see the Freedom of Information questions, and the response to them.
Dear Abgindon First
Thank you for your FoI request for information in relation to the Old Gaol. The Vale Council’s responses to your queries are set out below.
- When does the “Commercially sensitive” information regarding the deal between yourselves and Cranbourne Homes, become non sensitive anymore, (After all this is now over 7 years down the line, so cannot possibly still now be commercially sensitive where competitors may have been concerned when the deal was struck?
The Vale Council has kept the deal confidential since it was first agreed. There were two main reasons for this: first to respect the developer’s commercial information, in order to protect the Vale Council’s town centre redevelopment ambition; and second to avoid disclosing details of the unsuccessful bids to the winning developer, in order to protect the public purse. As a result, the Vale Council has helped to keep the development on track. However, the development is not yet complete and occupied, and the Vale Council wishes to keep the development on track, so we will maintain confidentiality on any commercially sensitive information until the development is completed and occupied, when we will review whether any additional information can be disclosed.
- How much was actually agreed for the sale? On BBC Radio Oxford a while ago, Conservative Councillor Sandy Lovatt let slip that he had heard that the figure was £7 million. Is this correct?
The final sale figure agreed by the Vale Council for the Old Gaol site is £3.2 million, which is well in excess of the next best tender bid when the site was marketed in 2007, plus £1 million towards affordable housing provision.
The timeline for achieving this sum was as follows:
- following a tender process in 2007, the Vale Council agreed to accept the highest bid for the site, which was for some £6.3 million to be paid from the developer’s sale proceeds – however, these proceeds were estimated in December 2007 when the property market was booming and the residential units were expected to sell high
- shortly afterwards, the market collapsed and RBS withdrew its original funding agreements, therefore the Vale Council agreed in September 2008 to renegotiate the contract to keep the development viable and on track – the agreed capital bid of some £6.3 million was changed to a shared risk-based approach based on a capital receipt of some £3.75 million plus a share in the developer’s sales receipts (overage)
- due to continuing difficulties in the market, and in order to keep the development viable and on track, the Vale Council agreed a further variation in March 2010 by reducing the capital receipt to some £2 million along with an overage provision.
- following completion of the demolition and archaeological works as required by the contract, the Vale Council transferred the freehold to Cranbourne in August 2010 based on this revised agreement.
- in view of the continuing uncertainty in the market, the Vale Council agreed in October 2012 to the certainty of a fixed one-off overage payment of £1.2 million, rather than the uncertainty about the variable level and timing of overage to be paid during the development in accordance with the terms of the contract
- finally, in view of the changed local housing need in Abingdon, the Vale requested a commuted sum in lieu of the remaining affordable housing provision. Cranbourne therefore agreed to pay £1 million on a staged basis. The developer had already provided ten units of affordable housing at the former ambulance station in Abingdon.
- How much of the original amount has now been paid by Cranbourne Homes, and when, if ever is the remainder to be paid?
The developer has paid the Vale Council some £2,033,500 + £40,354.81 VAT for the site + £1,200,000 as overage + £100,000 as the first of a series of staged payments towards affordable housing provision = £3,333,500 + 40,354.81 VAT.
The remaining £900,000 contribution towards affordable housing provision is due to be paid as five annual payments of £180,000, starting in April 2016, making a total receipt of £4,233,500 + 40,354.81 VAT.
- We have heard that the Vale has “written off” the remainder of the debt as a long term loan, is this correct, and will Cranbourne ever be made to pay back the remainder of the money?
This is not correct, as shown above.
- Will any money paid for the Old Gaol ever be paid back? (Abingdon BADLY needs a cinema and other entertainment facilities, but it seems that Oxford, Botley, Didcot and other localities are getting all of the funding, leaving Abingdon way behind, to the detriment of businesses and shops in the town.
This query does not fall within the FoI legislation. However, any receipts from the disposal of land and buildings are for use by the Vale Council across the district and not necessarily used specifically for the area where they were generated from.
Peter Beer | Strategic Property Team Leader South Oxfordshire & Vale of White Horse District Councils
135 Eastern Ave, Milton Park, Milton, Abingdon, OX14 4SB