Green Lanes Shopping Centre - frequently asked questions
1. How will it be funded
The acquisition will be funded through the Public Works Loans Board which offers favourable interest rates on loans for local government projects. Revenue income from the shopping centre rentals and car park income will pay for the loan costs and surplus funds will be re-invested back into the centre and other regeneration projects within the District.
2. What sort of a state is the building in?
An external condition survey of the building concluded that there is no real evidence of significant defects to the structure of the property. Over the next five years around £1.5m will be needed to carry out maintenance and repairs which was reflected in the bid.
3. Will it carry on being retail?
We are already working hard on attracting new tenants to vacant units. We are confident that we can provide opportunities for local and national companies to set up retail businesses in Barnstaple and will also be exploring alternative uses that complement the retail uses, create footfall and fit in with our commitment to creating a vibrant town centre.
4. Will it make a profit and what will that be used for?
Yes we are anticipating a profit which helps us towards our aim of becoming financially self-sufficient. Cuts have led to our budget shrinking by around 40% in the last ten years. Next year alone, we have a £0.5m gap in our budget. We have made some cuts in services but that is not a path we want to continue down. The profit from this venture will help us continue to provide high quality services to our customers.
5. How will the centre be managed?
The Property and Regeneration Teams at North Devon Council will be taking an active role in the strategic management of Green Lanes. The Centre Manager, Craig Bulley, and his team will remain in place to support the centre’s tenants and shoppers.
Shopping centres are a specialist type of property asset, they are ‘live’ assets which frequently change on a number of levels. In order to effectively and efficiently manage the centre on a day to day basis, the council will be supported by a specialist property management and investment company called Praxis.
Praxis manage their own portfolio and well as assets for another local authority. They manage a number of shopping centres throughout the UK which are similar in size and context to Green Lanes.
Over the coming weeks, council officers, Praxis and the centre management team will be in touch with the tenants to fully inform them of the council’s commitment to the centre and advise them on the points of contact as the council take ownership of Green Lanes.
6. Who else was involved in the process?
Knight Frank acted for North Devon Council on the acquisition of the property and Savills acted for the vendor.
7. What price did North Devon Council pay to buy Green Lanes Shopping Centre?
The acquisition price was £8.2million.
8. What are the monthly and yearly repayments on the Public Works Loan Board loan?
It is an annual repayment of interest and principal - total annual cost of £460,000. This cost is covered from the revenue income derived from the Centre and overall there is a net positive return to the Council.
9. Why was the price subject to a confidentiality clause?
This clause was at the request of the Seller prior to completion and was due to their commercial sensitivity.
10. What was the valuing of Green Lanes Shopping Centre when NDC first considered purchasing it several years ago?
The current owners paid £36.1million for the Centre back in 2015 (as per information already in the public domain on the Forsters website who were their legal representatives); we held discussions with the owners through 2018 and 2019 however this did not result in anything coming forwards that we would consider and discuss with our members. The acquisition price paid of £8.2million was in line with our valuation we carried out on the current asset and the associated market conditions.