Agenda item

(Voting: unanimous in favour)

The Portfolio Holder for Commercial Services and Income Generation reminded Members that the Council’s commercial investments provided the finance to maintain vital front-line services.  He noted that a performance chart previously in the confidential appendix had been moved to point 39 in the report.  The 3 points of the strategy – the amount invested, the gross return on the investment and the net return were all either on target or very close to target which was a credit to the investment team particularly during the challenging previous 12 months.

The Commercial Property, Land and Development Manager advised that the net revenue contribution was just short of target (chart at point 29) by £7,000 on £1.8m which was a very small difference.  In updating Members, he said:

·         The Covid situation had made rent collection more important but it was almost at 100% collection. 

·         Empty office/unit space was an issue as a tenant had been lost from one unit.

·         Investment had paused but it had now resumed with 3 purchases of a Fitness First property in Poole, an NHS food production unit in Redruth and an office building in Birmingham as a data centre.

·         The Fareham battery storage scheme was now committed and on track for construction.

·         The second house at Marlborough was on the market as were 15 flats and they were in a location where the market was strong.

The Chairman congratulated the Commercial Property, Land and Development Manager and his investment team for their work in a very difficult investment period.

In response to a question, the Commercial Property, Land and Development Manager advised that it was not yet known if the Marlborough development would make a profit yet.  If so, it was likely to be low. 

The Chairman of the Scrutiny Committee advised that the following points were made during their meeting:-

• Members acknowledged an update from the Commercial Property, Land & Development Manager that the graph ‘20/21 Performance Against Budget’ would be moved from the confidential appendix into the public report.
• Para 9 on confidential report – Referring to the coloured table, he observed that there are a number investments that seem to be showing as a nil or negative return in the future, he asked for some further explanation on the reasons for these assumptions.
• Some members suggested a briefing or workshop for members to help understand in more detail the approach for our investments (what and where) would be useful

•      Members sought clarification about delivery of commercial investments going forward as the current director would be Chief Executive in a few days. Members sought reassurance that there would be no conflicts of interest – especially regarding our directorship in some of the companies.

•      Members requested an update regarding the Marks & Spencer (M&S) store as it was believed the company were reviewing their land holdings.

•      Members also requested an update regarding Yeovil Town Football Club and what the current status was.

•      Members congratulated the team on their work, especially during current circumstances.

•      It was noted there was some budget remaining for investment – some members queried if this would be impacted by the unitary decision in a few months time?

He concluded that the report had been positively received with few questions which officers had provided answers to during the meeting.

The Chairman thanked the Scrutiny Committee for their positive comments on the report and for their report at the Area Committees to explain the role of Scrutiny to all Members.

At the conclusion of the debate, Members were content to note the report.