Issue - meetings

(Commercial and Regulatory Services Portfolio Holder) To consider the attached report.

Mover: Councillor A Patel, Commercial and Regulatory Portfolio Holder

Councillor A Patel submitted a report regarding a supplementary capital loan of up to £30 million for the purpose of general investment opportunities that were subject to the criteria outlined in the Asset Management Strategy (approved by Cabinet on 13 June 2019).

Councillor S Murray requested the right for his individual vote to be recorded. Namely that he voted against the recommendation.

Report as first moved ADOPTED

            RESOLVED:

That a supplementary capital loan of £30 million for the purpose of general investment opportunities be approved.

To consider the attached report (C-009-2019-20).

1)    That Cabinet recommend to Council approval and endorsement of an option to call on supplementary capital of up to £30 million for the purpose of general investment opportunities meeting the criteria outlined in the Asset Management Strategy (as approved by Cabinet in June 2019).

2)    The Cabinet agreed to grant delegated authority in deciding to make acquisitions of suitable investment properties, to the Portfolio holder for Commercial and Regulatory Services and Portfolio Holder for Business Support in consultation with Leader of the Council.

The Commercial and Regulatory Services Portfolio Holder introduced the Asset Management Strategy, property acquisition strategy report.  The Asset Management Strategy was adopted by the Cabinet in June 2019 and part of this strategy included the acquisition of investment properties and development opportunities. To implement this strategy, the Council needed the ability to make timely decisions and access to capital to complete such transactions in a competitive bidding situation. This was the context in which this property acquisition strategy was being proposed. Suitable funding and authority needed to be approved to facilitate EFDC exploring the property investment market and acquiring suitable investment properties (namely those with secure investment returns) in a timely and commercial manner, seeking to balance the wider portfolio against higher risk development opportunities.

Decision:

1)     That Cabinet recommend to Council approval and endorsement of an option to call on supplementary capital of up to £30 million for the purpose of general investment opportunities meeting the criteria outlined in the Asset Management Strategy (as approved by Cabinet in June 2019).

2)     The Cabinet agreed to grant delegated authority in deciding to make acquisitions of suitable investment properties, to the Portfolio holder for Commercial and Regulatory Services and Portfolio Holder for Business Support in consultation with Leader of the Council.

Reasons for Proposed Decision:

This would provide clear parameters in both allocated funding and decision making for EFDC to undertake suitable investment acquisitions as mandated by the AMS. This will allow EFDC to engage with acquisition agents with a clear rationale and provide potential sellers with clear timescales on acquisitions due to the delegated authority, which would be commercially advantageous to EFDC by allowing us to proceed in a commercial and timely manner.

Other Options for Action:

Alternative options were:

The Cabinet do not grant delegated authority and instead each investment is treated on a case by case basis as per periodic cycle of Cabinet meetings if required by Council – however this would make offers on investment properties uncompetitive as other buyers in the market would be in a position to act quickly.