Guildhall contract – further details

York Guildhall

The cost of the redevelopment contract for the Guildhall has been confirmed as £15.4 million. This covers only construction work.

To this must be added supervision, legal and fitting out expenses.

The contract was awarded to Vinci Construction on 16th September 2019.

It is expected that the total will be around £20 million but with substantial annual running costs.

The main use will be as a serviced office location although some Council use will be retained.

Fake news or wishful thinking?

Council publishes new “Our City” newspaper

No doubt the York Council would be criticised if it failed to keep residents informed about what goes on in the City and how the Council spends taxpayers money. Whether spending £10,000 on putting a magazine through everyone’s letterbox represents a prudent use of resources may divide opinion.

The current edition of “Our City” is tidier and therefore more accessible than previous editions. But it fails an important test.

It isn’t objective.

Telling people that things are going well when patently many street level public services in the City are far from that, transforms an information source into a propaganda channel.

There are major problems with keeping the streets tidy and free of weeds. The refuse collection service is now chronically unreliable. Many roads and paths are potholed. Some are dangerously obstructed by trees and hedges. These issues don’t merit a mention in “Our City”.

The Council does praise the hugely expensive community stadium project without telling people precisely when the stadium will come into use. Apparently the IMAX cinema (a plus for the City) will open in December but there is no explanation for the delays that have dogged the future home of York City FC and the York Knights Rugby team.

But the main concern will be the failure to be frank about the risks involved in some of its projects.

The Council is acting as its own housing developer and hopes to build 600 homes in the City over the next few years. It has recruited a significant number of additional staff to do so. It could have used local companies to undertake the work but chose not to. It is a high risk venture but, at the end of the day, in York any new homes will be occupied one way or another.

The same can’t be said about the £20 million Guildhall redevelopment. There is little evidence to suggest that a “business club” is needed in the City and even less that the York Council would be the best organisation to manage one.

The “Our City” article disingenuously talks of the project generating £848,000 a year in rents. It fails to point out that would involve renting out all the available space and that, even then, the income would be barely sufficient to pay the interest payments on the money that the Council intends to borrow to fund the scheme!

Sadly similar mistakes have been made in the past. £12 million was spent on the Barbican concert hall. The Council chose to manage that facility itself despite a complete lack of experience in the field. It later turned out that the hall manager had failed to apply for an entertainments licence for the building and had operated it unlawfully for several months. The Barbican ran at a loss of £800,000 a year and eventually had to be sold on to the private sector.

Whether anyone will come forward to rescue the Guildhall project remains to be seen.

£20 million contract signed for the conversion of the Guildhall into a business club

Almost comatose leadership has allowed the York Council to slip into a £20.2 million project which will see the Guildhall and neighbouring development site converted into a business club and restaurant.

Weed infested, stonework stained, windows caked with dirt. The neglect of the Guildhall since 2012

Neglect of the Listed building since 2012 means that some of the money will be needed to underpin parts of the old building while an new roof will also be necessary.

On even the most optimistic of income estimates, York Council taxpayers will be left with an annual bill of £574,000. Most of this is interest charges on additional borrowings of £16 million.

The York Councils PR department has been busy working on a, very awkward looking, video seeking to justify the £20 million scheme. Their time might have been better spent updating residents on what is being done to address failings with the bin emptying service, overgrown paths etc.

There have been numerous occasions over the last 8 years where decisive leadership interventions could have reduced the risk to taxpayers. (click)

2011

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2019

So now we move on to managing the contract and subsequently letting the newly created space.

The Council has committed itself to a £20 million cost envelope and an opening date in “spring 2021”.

The Councils record on major capital projects has not been good in recent years. The £42 million Community Stadium costs escalated from an original plan to invest £16 million and, 3 years after its target completion date, it is still not open.

Taxpayers will be monitoring progress on the Guildhall project with anxiety. Even after completion the authority will be faced with the task of renting out the new office space for £595,000 per annum. Failure to do so would mean an increased subsidy from taxpayers.

 Ironically the Council may then find that it is in competition with itself as some of he office space being built at the Community Stadium site has still not found an occupier.

York Councils empty property list revealed

Freedom of Information response confirms that buyer has pulled out of deal to buy 29 Castlegate
List of long term empty properties in York owned by the Council

The York Council has confirmed that it owns 12 substantial properties in the City which have been empty for over 6 months.

Two of the properties, Ashbank and the Guildhall, have been unused for over 6 YEARS.  

Ashbank was reported as being sold for £1.3 million a year ago. The Council now just says it is “sold subject to contract”.

The new Executive is expected to review the affordability of a £20 million scheme at the Guildhall which would see the creation of a “business club” there. If the project goes ahead, work will start in the autumn with reoccupation expected in 2021.

The estimated total value of the assets is put at between £30/40 million.

Little attempt has been made to secure short term lets for the properties which include prime sites like 29 Castlegate, the former youth advisory HQ.

Most of the properties have been exempt from paying business rates. Had they been occupied then Council taxpayers would have benefited from an additional £200,000 a year in income.

To this would be added rental income of around £400,000 a year or a substantial capital receipt.

The Castlegate property was to have been purchased by the York Conservation Trust with the York Civic Trust hoping to subsequently  lease the building as part of its expansion plans for the adjacent Fairfax House.

The agreed purchase price of £430,000 was criticised at the time as being “too low” for a building in such a prime site.

29 Castlegate

Now the Council says that it was notified on 21st May that the Conservation Trust would not be purchasing the building. However, the York Civic Trust had been told the same at their AGM last year. The Council say that they are now “reviewing” the position.

No public reports have been made on asset utilisation issues at the York Council this year.

The Council is spending around £80,000 a year on maintaining and securing the properties.

Only one of the properties has a temporary occupant (20 Piccadilly)

The table does not include underused assets like 19/21 Piccadilly (Spark) or land with a development potential. The latter includes land purchased in 2008 to accommodate an extension to Acomb Explore Library and which has been unused ever since.

19/21 Piccadilly

The Council says that it has only one Council house, at Glen Lodge, which has been empty for longer than 6 months.

The Council Housing department has been criticised in the past for allowing some of its estate garages to remain empty for extended periods of time.

The revelations have led to calls for a more proactive approach by the Council in the use of its assets. The new Council leadership has been advised to reintroduce a 6 monthly public report on empty property issues.

It may be that the time has come for the York Council to seek outside help in managing its huge commercial building portfolio

So who will win the York Council Elections?

Fulford and Guildhall wards reviewed

Fulford and Heslington

The Fulford ward, which merged with Heslington in 2015,  is home to 3,770 residents. Average incomes are higher than the City average. 65% of residents own their home.  22% rent privately and 10% are social tenants. There are 118 Council homes in the area. 1.4% are out of work. Crime levels are slightly above average.  90.9% of residents are satisfied with their local area as a place to live (York average 88.6%).  Source

Elections

This area has been a LibDem stronghold for decades. The current Councillor, Keith Aspden, is the Deputy Leader of the York Council.

He secured 55% of the vote at the last elections.

There is a strong University influence in parts of the ward.

The main concerns of residents relate to planned development in the area.  Work has recently stared on a major new housing scheme at Germany Beck.  As wheel as environmental implications residents have voice fears about flooding and traffic levels.

Family and Friends might best describe the candidate selection policies of he other parties. Former Lady Mayoress – to Green Councillor Dave Taylor – Susie Taylor contests her first local poll.  The mother of a former Tory Parliamentary candidate carries the torch for the Tories.

Keith Aspden has come through an unfair and protracted attempt by Council officers and some members to smear him with bogus allegations about breaking the Councillors code of conduct.  Hopefully he will be stronger from the experience. He can expect to be re-elected.

Prediction

1 LibDem seat

Guildhall

The Guildhall ward  is home to 16,650 residents.  Average incomes are lower than the City average. 37% of residents own their home. 38% are private renters and 22% are social tenants. There are 788 Council homes in the area.  1.3% are out of work. Crime levels are well above average. (the ward includes the central shopping/pub area)   86.2% of residents are satisfied with their local area as a place to live (York average 88.6%). 35.7% believe that they can influence decisions in their local area (City average 26.2). Source

Elections

A complicated voting trend history with the Greens gradually overhauling Labour to take one of the 3 seats at the last local elections in 2015.  A retiring Labour Councillor Brian Watson, who was deselected by his party, contested the ward as an Independent gathering a modest 416 votes. (He is trying his luck in Acomb in the 2019 poll)

The demographics are changing with expensive City centre property prices leading to the gentrification of some areas. This, and the higher General Election turnout,  may account for the modest Tory revival in 2015

All parties seem to struggle to find candidates who live in the ward. The Greens and LibDems haven’t found any locals to contest this ward. The Tories have done better. Labour have selected Fiona Fitzpatrick to join their team. She lives in the ward but stood down from her Hull Road seat in 2015.

The Clifton based, and current Labour Council Group Leader, Janet Looker only came third in the popular vote in 2015, when the Greens “First Choice” candidate Denise Craghill topped the poll.  Whether the Greens can get their “Second Choice” candidate elected as well this time, will be one of the more interesting results on 2nd May

There is an articulate electorate in area who may demand more from their representatives in the future.

Prediction

2 Labour seats, 1 Green seat

Lendal Post Office move confirmed

Lendal Post Office

The Post Office has confirmed that the Lendal Post Office will move to the W H Smith store on Coney Street.

The Lendal Office will close at 17:30 on Wednesday 4th April 2019. The new unit will open at 9:00am on Thursdays 4th April.

In a letter to objectors the Post Office says it received 571 responses from customers. Only 12 members of the public attended a “customer forum” event held on 19th December.

The letter goes on to say that the main objections to their plans centred around

  • Getting to the new location (it is in the pedestrian area)
  • Access within the WH Smith building
  • Concerns about customer service standards
  • Concerns about a potential loss in the range of services available (the Post Office confirms that Visa issue for visitors will not be available. The cash machine will also be removed)
  • The future of existing staff
  • The future of the War Memorial which is currently located in the Lendal building. (The Post Office say that it will be relocated following further consultation).

There was a certain inevitability about this decision given the parlous state of Post Office Limited’s finances. The publicly owned body has been under pressure from MPs to break even some years.

Nevertheless, there will be disappointment that the company has not been prepared to publish key performance stats. Potential customers have a right to know how long they may have to wait to be served at the 5 new counter positions which are promised.

The additional footfall near WH Smith may have one good outcome. That part of Coney Street has been in decline for several years with many shop units now empty. Hopefully the additional footfall will encourage more investment in what once was York’s premier shopping street.

There is lesson for the York Council as well. Tomorrow they discuss the future of the Guildhall offices. The buildings are adjacent to the Post Office.

The area needs a comprehensive conservation, access and modernisation plan.

Guildhall repair costs escalate to £20 million

Growing concern about debt levels as Council pledges to borrow more money

In December 2011 the then Labour controlled York Council was urged to make a prompt decision on the future of the Listed parts of the Guildhall.

The building became empty when the Council moved to “West Offices”.

It was to be the start of 7 years of prevarication. The fabric of the building deteriorated and repair costs escalated

Business plan 2014

The Council had embarked on an expensive and ultimately pointless design contest for the site.

Eventually the Council opted to use the building as a “media centre” although it was some time before a cost of £9 million for the conversion work was published.

Keeping the building empty was costing taxpayers over £150,00 a year in maintenance costs. The fabric continued to deteriorate.

A new “coalition” administration took over in York in May 2015.

Business plan 2016

They had been critical of Labours plans and the expectation was that they would test the market to see what the private sector might do with at least part of the site. They failed to do so and instead hatched a behind close doors deal to turn the complex into a self funding” business centre.

They could not find any public or private sector partners who would be willing to share the risk on this patently uneconomic project.

The cost of the project was put at £12.7 million. Councillors claimed that it would still break even with rent income offsetting the costs of borrowing.

By 2018 the estimated cost of the project had soared to £17 million. Councillors ignored pleas that the site be put on the open market. There was interest in providing residential, hospitality or prestige office accommodation on the site. The Council decided to plough on regardless

Business plan 2017

 

6 months ago the neglect of the building had become apparent to passers-by.

Yesterday the Council published a report saying that the project costs had risen to over £20 million. They admitted that taxpayers will have to find nearly £600,000 per annum to pay interest charges on the additional borrowing

NB. This year 11% of taxes paid by York residents were used to pay interest charges on the Councils borrowing. This will have increased to 21% by 2022.

By the same date, the Council total debt will have increased to £479,000,000.

Business case Feb 2019

York Council’s investment programme slipping into crisis

Major delays on housing modernisation, Guildhall repairs and transport improvements

Executive report 30th Aug 2018

A report to a meeting taking place on Thursday suggests reducing this year’s capital investment programme by £33 million.

The slippage includes major tenant choice housing modernisation works as the Council has failed to appoint a contractor to carry on the programme. No explanation of the programme failure is offered. The delays could affect other works including those dealing with standing water under homes and upgrades to water mains. These issues have not been publicly reported to the Councillor who has Executive responsibility for housing

The Council does still hope to make a start on controversial building schemes at Newbury Avenue (Autumn 2018) and the £22.5 million Lowfields scheme (Spring 2019).

The report claims that £748,000 “approved by the Executive in December 2016 for Lowfield sports facilities” will be spent, thus perpetuating the myth that the new football pitches being provided near Bishopthorpe are in some way linked to the Lowfields redevelopment.

There are also delays on several major transport infrastructure schemes.

Improvements to the northern by-pass (basically bigger roundabouts) will slip into 2019/20 as will a start on the new York Central access road from Water End.

Guildhall “business case” March 2017

Work on refurbishing the Guildhall will also be delayed with nearly £10 million slipping as a start on site is not now expected before summer 2019. Reopening is unlikely before 2021.

The Guildhall remains closed to the public and is not used now even for Council meetings. Even an empty Guildhall costs taxpayers about £330 a day with much if it going on Business Rates, heating, energy and security. To that should be added the cost of hiring alternative premises for Council meetings and the additional repair costs that inevitably arise when an old building is left empty for an extended period of time.

The Community Stadium work is “progressing on timetable’. However, £5.8 million in contract  payments are being slipped from 2018/19 to 2019/20.

The Council still expects to invest around £124 million during the present financial year.

Guildhall project cost set to leap to £17 million

When you are in a hole stop digging  – or at least dig where the foundations need to be repaired

York Guildhall

It appears, from a report being considered by the Councils Executive on 8th May, that the cost overrun on the Guildhall development project could have been as much as £6 million. That was what caused officials to pull the plug on a contract with Interserve to redevelop the Guildhall complex.

Taxpayers had already been asked to underwrite an estimated cost of over £12 million for the Council’s plan to establish a “business centre” in the building.

There was no way even the most optimistic estimates of income would have covered the extra £300,000 pa interest costs on the borrowing.

Incredibly Councillors are now being asked to tender the work again with minor changes. Amongst these are a plan to move all building materials through St Helens Square during the 18 months construction period (rather than via the river frontage).

Roof terraces and extensions would be abandoned

Despite these changes, the estimated total cost of the project is now estimated to be an additional “£4-5 million”

“Business case” March 2017

That will be a direct charge on taxpayers as there is no scope for additional income from rents in what will be a smaller than originally planned building.

Significantly, officials provide no update on the business case for the “business centre” which is now clearly nonviable.

It was highly marginal under the old plans (see right) and was therefore labelled as “highly risky” with no private sector partner prepared to become involved

The Councillors are not even being offered the obvious option which would be to put the site on the open market and allow experienced entrepreneurs to suggest viable uses..

The Council has admitted that it has already spent £1.5 million on the project.

If the Council does seek new tenders for the business centre project, they face a major delay – probably until after the next local elections (due in May 2019).

If Labour were to be successful in that poll, they would be left picking up the pieces of a project which started to go wrong during their last tenure in office. They had from 2011 to decide what to do with the Guildhall complex but dithered for four years before passing the buck on to the incoming administration in 2015.

The listed buildings continue to deteriorate.The report say,s “work has identified additional repair and maintenance work particularly relating to the structural weaknesses in the tower and the estimates have risen from £2.5m in the 2017 report to between £3-5 million

With the annual maintenance bill continuing to grow, taxpayers will wonder just how they can now extract themselves from what has developed into a major financial black hole

If the market had been properly tested four years ago this crisis might have been averted.

Guildhall redevelopment deal collapses

Interserve (ICL) taken off contract as costs escalate

York Guildhall

The York Council’s, accident prone, plan to redevelop the Guildhall as a business centre has collapsed.

They have been unable to agree a final cost target with preferred contractor ICL.

ICL were awarded the contract last year, with the overall expenditure on the controversial plan then put at over £12 million.

The Council were criticised for putting so much taxpayers money at risk on what was a speculative venture.

A report published today says that

“In accordance with the contract ICL advised their tender submission would be delayed and made an initial stage 2 tender submission on 16 February 2018. Unfortunately this was significantly in excess of the current project budget and contained a number of outstanding cost items which did not provide sufficient proof that the submission evidenced value for money”

Guildhall project layout plans

The Guildhall has been largely unused since the Council moved its operation to West Offices in 2013. Initially it had been expected that a private sector partnership would lead the redevelopment of the site which is in a Conservation area and which includes two important Listed buildings (Guildhall and Council Chamber).

It is unclear what will now happen although there are growing concerns that the empty buildings will continue to deteriorate with taxpayers facing an increasing annual maintenance burden.

The Council has already spent over £1 million on the aborted project.