Decision details

Grant of lease at less than market value

The Cabinet Members agreed

1.1  To grant a tenancy of the building at 4 Abbey Street to 44AD C.I.C. for 16 years at an abated rent for the first 4 years of the term.

1.2  The lease to contain a rent review to open market value, after 4 years and the Council will have the absolute right to determine whether to implement that review or to continue with the abatement.

The proposal has been developed on the basis that this transaction would be entered into at less than market value because the Council wishes to increase the potential for the arts sector to provide more opportunities for local residents and visitors.

It is considered that 44AD is a successful arts organisation which provides opportunities, training, support and outlets for local artists. It will contribute to the Cabinet’s aspirations set out in the 2014/5 budget report to develop capacity in the voluntary sector to help achieve Council objectives.

44AD have previously occupied Council premises on a temporary basis under a tenancy at will.  At the time of the discussions with the Chief Property Officer it was considered necessary to obtain vacant possession of the property as plans were afoot to redevelop it. This was considered an important factor as a significantly higher rent was envisaged following redevelopment and subsequent re-letting.

Disposal of the property on the open market has been considered but not pursued. The alternative offers received to lease the building have been rejected in favour of the proposed letting for the reasons stated above.