Issue - meetings

Report of the Director of Property Services and Development

The Cabinet considered a report of the Director of Property Services and Development which sought approval to accept the surrender of an existing 75 year lease for the Ernest Jones premises in the Upper Precinct, Coventry. The surrender of the lease will allow the Council to implement phase two of the public realm scheme in the Upper Precinct through the demolition of the current premises and the completion of the scheme.

A corresponding private report was also submitted to the meeting setting out the commercially confidential matters of the proposals. (Minute 54 below refers.)

The Council will be paying a surrender premium to the proprietors of the Ernest Jones premises, writing off a sum of rental arrears (as highlighted in the private version of this report) and will be forgoing rental income of £137,000 per for the rest of the lease term. This report sought approval for the funding to enable the surrender to occur, approval to write off the relevant rental arrears and the adjustment to the Council’s income target resulting from the surrender.

By agreeing the surrender of the lease, the Council will be able to move seamlessly from the first phase of the Retail Quarter scheme to phase two, minimising disruption and reducing the overall delivery programme. The City Centre will benefit from improved accessibility and flow for residents and visitors in the spaces between Broadgate and the Upper Precinct. The removal of the Ernest Jones building will enhance sight lines and enable greater footfall and visual appeal for businesses either side of Upper Precinct and Broadgate. The installation of the new water features and fountains in Upper Precinct will further enhance these views, reinforcing the world class city centre placemaking approach.

RESOLVED that, subject to the consideration of the private report on this matter, the Cabinet:-

1)  Agrees to accept the surrender of the Lease and the entry into of all associated legal agreements between the Council and Signet (Ernest Jones Limited) for the premises (as shown edged red on the plan in Appendix 1).

2)  Delegate authority to the Strategic Lead - Property and Development, following consultation with the Finance Manager, the Director of Law and Governance and the Cabinet Member for Jobs and Regeneration, to undertake the necessary due diligence and approve the final terms of the surrender.

3) Recommends that Council:- 

i)  Approves expenditure, of the sum as highlighted in the private version of this report, from reserve balances to fund the premium required to be paid for the surrender of the lease.

ii)  Notes the loss of rental income incurred in the delivery of this proposal that will form part of the forthcoming budget setting report.