Agenda item

Report of the Deputy Chief Executive (Place)

Councillor K Caan, Cabinet Member for Public Health and Sport has been invited to attend for the consideration of this item.

The Cabinet Member considered a report of the Deputy Chief Executive (Place) which provided an update following the Council’s decision on 10 October, 2017 to approve a commercial investment to acquire 100% of the shares in Coombe Abbey Park Limited (CAPL), the operating company of Combe Abbey Hotel.

CAPL operates as a going concern and has successfully grown the business over the last few years. Following approval of the purchase by Council, officers and the current owner, Mr Gordon Bear, have continued negotiations on a fair price for the Council acquiring 100% of the shares in the business.

The report indicated that Local Authorities are increasingly looking for strategies to drive commercial income through the acquisition of property and other investments. The Council already has a commercial interest in Coombe Abbey Hotel, through the freehold ownership of the land and buildings, which are let on a long lease to CAPL. This generates a significant annual rental to the Council. Coombe Abbey Country Park and Hotel are important cultural, leisure and tourist assets for the City. The Council’s existing interests in CAPL results from work over the last 20 years to bring the building back into use and operate it as a unique hotel.

The hotel has continues to increase turnover and profit year on year, with a 64% increase in profits in 2016 compared to the previous year. The increase in revenues is partly due to increasing capacity for larger functions with the marquee on site, the introduction of afternoon teas and charging for car parking.

The report indicated that since the Council meeting on 10 October, 2017, officers have:-

• Continued to work with the existing hotel management team to recruit an Operational Director to run the hotel on behalf of the City Council. This professional search has produced a number of suitable candidates that are in the process of being interviewed.

• Continued to negotiate on the fair price for the purchase of CAPL. To date this has resulted in a further reduction to the price indicated in the private report considered by Council on 10 October, 2017.

• Worked to complete the suite of documents required for the purchase and transfer of CAPL from Gordon Bear to the City Council.

The Cabinet Member provided a full explanation as to why, for commercial reasons and in order to achieve the best possible deal for taxpayers, it had been necessary to consider this matter in private in October. Councillor O’Boyle also indicated that, as soon as the deal had been signed and completed, further information in relation to the deal would be made available to the public to ensure transparency.

In line with the delegation approved by Council in October, Councillor K Caan, Cabinet Member for Public Health and Sport, had been invited to attend the meeting.

RESOLVED that the Cabinet Member for Jobs and Regeneration:-

a)  Notes the progress made to date in negotiating a final purchase price for Coombe Abbey Hotel Ltd

b)  Notes that the purchase price is lower than the level delegated to officers in the report approved by Council on 10 October, 2017.

c)  Notes that interviews for an Operational Director for Coombe Abbey Hotel have now taken place and that a successful candidate is likely to be in post by March 2018.