Decision details

The Chairman reminded Members that Essential Reference Papers “B” and “C” of this report contained exempt information as defined by paragraph 3 of Part I of Schedule 12A to the Local Government Act 1972, and advised that, if any Member wished to refer to any detail in these, then Council would need to pass a resolution to exclude the press and public. 

The Executive Member for Finance and Support Services submitted a report presenting the first 30 year business plan for the Council’s Property Investment Company, Millstream Property Investments Limited, which included approval to sell at market value the Council’s five existing residential properties.  He also sought approval to make an equity investment in the company which would consist of part of the value of the properties being transferred and not a cash investment.  Finally, he sought approval to extend a loan to the company at commercial rates, thus being state aid compliant.  

The Executive Member for Finance and Support Services moved, and Councillor M Pope seconded, the recommendations as detailed in the report submitted.

Council approved the recommendations as now detailed.

RESOLVED – that (A) the initial 30 year business plan for the Property Investment Company, to be named Millstream Property Investments Limited, as presented in Essential Reference Paper “B” of the report submitted, be approved;

(B)      the four Council-owned properties in Bishop’s Stortford known as 1 Old River Lane, 2 Old River Lane, 3 Old River Lane and Castle Bungalow, Castle Gardens and the Council-owned property in Hertford known as 6 Water Lane be sold to the company at full market value;

(C)      the Council makes an equity investment in the company of £424k;

(D)      the Council makes a loan on commercial terms to the company of £787k;

(E)      authority be delegated to the Head of Finance and Property to increase the equity investment and loan by up to 2.5% should the property valuations at the time of sale be higher than assumed in the business plan, with any increase in excess of 2.5% to be brought back to full Council for consideration; 

(F)       authority be delegated to the Head of Finance and Property to determine the terms of the loan to the company with due regard to state aid regulations; 

(G)      a capital allocation of £85,000 is made to carry out essential capital works to 6 Water Lane, Hertford to bring it up to a lettable standard prior to disposal to the company, with these costs reflected in the market valuation; and

(H)      the company starts trading once it is incorporated.