The Council has confirmed that the promised “profit share” on the Spark container village development on Piccadilly has still not materialised.
Payments should have been made at the end of the last financial
Only one single “rent” payment of £13,333.33 has been received
by the Council.
In their original pitch to the Council in 2016, the operators promised a share of the profits on the project which were expected to more than cover the £40,000 costs of the Council providing mains services to the site.
No explanation for the failure to make a payment has been published nor is there any item on the Council forward decision-making programme which would suggest when an explanation may be forthcoming.
It is estimated that, had the site simply been used for car parking, the Council would have received around £200,000 in income over the last 3 years.
The containers are due to be removed in June 2020 although the
Council has been very slow to market the availability of the site for permanent
There have been ongoing problems on the site with several planning conditions not being observed.
Over £4000 in Business Rate payments are also owed to the Council.
NB. Under EU regulations, which are still expected to apply after 31st January 2020, government bodies are specifically prohibited from subsidising private companies.
Latest figures published by the York Council suggest that anyone who has a planning application rejected by the local authority has a 30% chance of having the decision reversed on appeal. Appeals are considered by independent inspectors.
The figures reveal that inspectors rejected two appeals against decisions that the planing committee had made and which were in conflict with the recommendations of local planning officers.
One of the these concerned the controversial Spark Container Village who tried to avoid providing cladding on the public frontage of the shipping containers.
Some 18 months after the containers were occupied, the cladding has still not been provided. With the Council still not having advertised the Piccadilly site for sale, there is growing concern that the situation will drift on.
The planning permission for the containers does expire in June 2020 so the matter must come to a head within the next few months.
The shipping container village on Piccadilly may look a little different this winter. Spark has applied for planning permission to install plastic sheeting to close the gap between the canvass roof and the side of the development.
No sign yet of the cladding being installed. Nor has the council confirmed that they have received their share of the “profits” on the enterprise from last year.
The Council has confirmed that it has not received any payments from the Spark container village as part of the “profit sharing” arrangements agreed nearly three years ago.
The payments were expected to help offset the £40,000 of taxpayers money spent in providing electricity and other services to the site.
The first payment was due in April
The company also haven’t yet provided the cladding required by a planning condition dating back nearly 2 years. The Councils planning department is coming under increasing pressure to take enforcement action.
The Spark owners were recently quoted in the local newspaper as wanting to continue to use the site when their current lease expires in June!
……..as Spark finally submit proposals for cladding their shipping container village
City of York Council has received notification from the Planning Inspectorate that the applicant for the Moor Lane planning application (18/02687/OUTM) has appealed the Council’s decision to refuse the outline permission for up to 516 residential units.
The Planning Inspectorate has notified the Council
that the Inquiry will start on 12th November 2019 and it is anticipated that
the Inquiry will sit for 12 days.
The Council will send notification of the appeal to
any person who was notified or consulted about the application and any other
interested persons who made representations.
If however the representation was part of a
petition, each individual on the petition will not be notified by the Council.
Separately the Spark container village people have finallysubmitted details of their plans to provide cladding on the development frontage.
They say, “We propose to attach to this frame a secondary timber structural frame which will be over clad with treated softwood or Siberian Larch battens of 50mm width running vertically with a 50mm gap forming a continuous wrap and palisade along the external boundary. The timber cladding will be overplanted with Clematis growing from planters situated at first floor level”.
The development reaches the end of its 3 year lease next
June. We doubt very much whether even fast growing clematis will make much difference
to its appearance during the intervening months.
NB. The Council has so far failed to say how much “profit
share” they enjoyed from the Spark lease last year.
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.
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.
The Council says that it has only one Council house, at Glen
Lodge, which has been empty for longer than 6 months.
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
A Planning Inspector hasrejected an appeal regarding the Spark container village on Piccadilly.
The owners of the units were hoping to avoid installing wooden cladding on the outside of the shipping containers as was required by the original planning consent granted in May 2017.
In August 2018 the Councils planning committee refused to remove the requirement for the containers to be clad in timber panelling. They concluded that the industrial style containers had an adverse impact on the appearance of the Central Conservation Area.
Spark appealed against this decision.
The appellants claimed that “that the financial implications
of the approved installation would be prohibitive and would put the entire
project at risk”.
However, the Inspector said that the costs of the cladding
would have been known from the start.
The Inspector concluded “I find that no public benefits have been demonstrated that would outweigh the harm and there is no clear and convincing justification for the variation of the condition”.
Despite much prevarication, the controversial Spark project
now seems to have reached the end of the road. Their lease expires next July
anyway, and the Council will be eager to market the site for a more sustainable
The site is likely to be worth over a million pounds – money that the Council desperately needs to sustain the rest of its capital investment programme. The most viable use would be for a visitor attraction on the ground floor with either flats, offices or a hotel above.
The Council will also be expected to reveal how much their share of the “profits” on the development have actually been received.
The profit share arrangement was a key consideration when
the Councils Executive agreed to release the site at their meeting in November 2016.
The taxpayers investment of over £40,000 in infrastructure was to have been
repaid from these “profits”.
The shipping containers arrived on site in September 2017.
They were widely regarded as “ugly” with street art graffiti on the Piccadilly
frontage making the appearance even worse. The containers blight the Piccadilly
area which is otherwise seeing signs of regeneration. Three new developments
are currently underway on the opposite side of the road and a “Castle Gateway”
masterplan is in the process of being approved.
We think that Spark have been playing the Council along for many months.
The issue will be a major test of the effectiveness of the newly elected York Council. They must seek to quickly enforce the planning conditions on the site, while also recovering any outstanding debts.
They would also be wise to start marketing the site for future development.
In response to a Freedom of Information request, the York Council
has revealed that it has received £13,333 in rent from the Spark container village
on Piccadilly since they first arrived in September 2017.
This amounts to little more than £700 a month since the organisation
took over the prime site.
No payments have been received by the Council from the “profit
sharing” scheme agreed as part of the deal to allow shipping containers to be installed
on the site. The council says it is still awaiting receipt of accounts for last
accounts filed by Spark were for the year ending March 2018.
£19,856 is owed by Spark and its tenants for Business Rates.
The Council says that it is taking recovery action.
The original Spark business pitch to the Council talked about a £71,000 profit each year. Part
of this was to be used to repay the Council’s initial investment (which cost
over £40,000) in new utility infrastructure,
The container village has been
controversial from the start with long delays in meeting some planning
conditions. An instruction to replace graffiti style street art with cladding
on the Piccadilly frontage is still outstanding(click
The contract allows
for the Council to take back the site if, after 21 days, the tenants have
failed to pay the rent or complied with their obligations under the Lease.
Many of the individual units have
been empty over recent months.
Although warmer weather may give the containers a temporary boost in customer numbers, it is surely long overdue for the Council to test the market by advertising the site for permanent redevelopment.
It seems that the Spark organisation has submitted a last-minute appeal against the Council’s decision not to allow them to keep the Street Art/Graffiti on their Piccadilly frontage. They had hoped that the Council would not enforce the planning condition which requires them to install wood cladding on the outside of the shipping containers.
In August they lost their planning application to revise the conditions governing their use of the site.
Any appeal could take months to resolve, so it may now be down to the Council, as the landlord, to act to remedy the defect. The Council will be expecting a major paymentfrom the business over the next few weeks.
Rates, rent and profit share payments due in the next few days.
Spark April 2018
The valuation office has completed its assessment of the rateable value of the Spark container village on Piccadilly.
Figures published on their web site suggest a total valuation of £138,730.
In the normal course of events this would bring around £65,000 into the City’s coffers helping to offset the additional costs of street cleaning, refuse collection, policing etc. associated with developments of this sort.
Increases in rateable value these days bring an immediate boost for Council finances under rate retention schemes (The Council’s rate support grant has consequently been reduced to zero this year).
But will there be a boost in this case?
Valuations were apparently requested on a per container basis. This means that none of the 25 units has a rateable value of more than £12,000.
Government regulations on rate relief for small businesses say “You will not pay business rates on a property with a rateable value of £12,000 or less”.
So, unless an occupier has a second business property elsewhere, then they may not pay any rates at all.
Empty properties are exempt from Business Rates for 3 months.
Some of the alcohol selling units on the site are said to be highly profitable. No doubt other traders operating nearby will question whether this is fair competition.
York Council officials are staying tight lipped about whether they anticipated this development.
The original Spark business pitchto the Council talked about a £71,000 profit each year. Part of this was to be used to repay the Council’s initial investment in new utility infrastructure. The first payment toward paying off this debt is due in a little over 6 weeks’ time, together with the Council’s share of what Spark claim is a “£1.5 million profit”
NB In August 2018 the Council refused a planning application from Spark to omit the wooden cladding for the containers which they had suggested as part of the original application.
Spark is currently closed on Mondays and Tuesdays. Sparklistonly 4 retailers who currently operate from the containers. There are also 7 food and drink outlets