NW&SCC response to Consultation on Disposal of Nairn Common Good : Grant St Yard and Store
Added at 13:26 on 28 February 2022
Nairn West & Suburban Community Council
23 February 2022
Ms Sara Murdoch,
Common Good Officer
Inverness (sent by email)
Dear Ms Murdoch ,
NAIRN COMMON GOOD: CONSULTATION ON GRANT STREET YARD & STORE
In January Highland Council announced a public consultation on a proposal to dispose by sale of the property described as a “workshop/store and yard” in Grant Street Fishertown, Nairn, which is listed in the register as an inalienable Common Good (CG) asset. The closing date for responses is. 10 March.
NW&SCC is opposed – for the reasons listed below – to the present proposal.
1. Failure to examine alternative options
The only proposition being consulted on is “disposal by sale”. We think it is wrong in principle, and for the further reasons listed below, to consult only on a single option or course of action. Consideration of the management and future of any CG property should be based on a full evaluation of all options. In most cases, these would include – at least – retention; commercial lease; concessionary/community use or rental; and/or disposal by sale.
In this instance, the published document shows no evidence that all the possibilities have been properly assessed. It presents only two relevant statements.
The Council’s own surveyor is of the opinion that “leasing the premises in its current condition would not generate a significant rental income …. [and that] works to demolish and/or restore the current buildings would incur costs for the Common Good Fund and would be unlikely to result in a proportionately higher rental income.” No evidence is provided in support of either opinion. There is no information on whether the property has even been offered or marketed for rental. There are no estimates either of rental value or of restoration costs.
The document says that “Taking all matters into consideration, [local]Members were of the opinion that the proposal to dispose of the site in its current condition might be the best option...”. There is no indication of what matters were in fact considered, and on what basis. And the conclusion, such as it is, is hardly definitive. This suggests either that elected Members have not in fact carried out due diligence as trustees, or they have looked at whatever evidence is available and reached only an uncertain or tentative view as to what might be best. Whichever may be the case, this is not a sound basis on which to consult.
2. Evidence of interest in renting
The failure to assess or research the feasibility of renting the property (with or without an obligation to refurbish) is given additional significance by the clear and direct evidence which has emerged since the consultation was announced, of local interest in renting the property on the part of local organisations and groups and individual tradesmen and businesses.
Public comments have highlighted that fact that the Council had not publicised, advertised or offered the site for rent. This suggests that the surveyor’s opinion and elected members’ views were not founded on proper appraisal. At the very least, all opportunities for leasing the property should have been explored against the criteria of ‘best value’ and (as this is Common Good property) community benefit, before any proposal to dispose of the property was tabled.
3. Policy considerations – short and long term benefit
In managing CG assets, trustees have to have regard to best value and community benefit. There is no evidence that either has been adequately assessed or calculated. In particular, there is no comparative cost/benefit analysis of the case for disposal (in its present neglected state) as against the case for rental of the property (with a range of possible terms) to generate an income stream, with the site itself remaining as a capital asset in the Common Good.
The clear evidence of interest in rental (as noted above) reinforces the argument that lease – rather than disposal – deserves much more serious appraisal.
This in turn raises the policy-issue: is a single, one-off gain from disposal by sale better value than a rental (even if at concessionary or below market rates) for a long period to generate an income stream? Our view is that in almost all cases the rental-income approach represents better value than the one-off capital gain, and is in the longer term interest of the community and the Common Good.
Common Good is a unique type of asset, subject to a material consideration that does not apply to other land or property: it has to be used for the benefit of the local community. In the case of possible rental of a site, this could be reflected in conditions requiring the tenant to maintain and/or restore the property in order to ensure that such costs do not fall to the CG Fund. It could also justify the setting of a concessionary rent if the tenant is a local community group or charitable organisation which benefits the town. In the eventuality of a sale, this could also justify sale-conditions which limit what might be described as ‘opportunistic’ asset purchase – for example to land-bank the site or to acquire the site for speculative redevelopment.
• we oppose the present recommendation to dispose of the asset by sale, because other options have not been adequately assessed, if at all – and they should be;
• There is clear current interest in leasing/renting this particular property. We therefore believe the rental alternative requires full exploration before any recommendation is put forward for consultation, so that the public can offer an informed view and express their preferences on the basis of hard evidence rather than opinion;
• as a matter of wider policy, we consider that rental of CG property to generate income is almost always better value and of greater benefit to the community than the one-off outright sale of the asset. We therefore believe that rental-viability should be fully assessed before any consideration is given to disposal by sale, and that in either situation, the trustees should look to apply suitable conditions.
• The present proposal should therefore be withdrawn, to enable a full and considered appraisal of all the alternatives. Once clear evidence has been assembled – including the viability of lease options – new recommendations could be put forward in due course for public comment.
This letter is copied for information to the Chair of Nairn River Community Council, and to theNairn Ward Manager.
B E Stewart
interim Secretary, NW&SCC