Decision details

DECLARATIONS OF INTEREST FOR ITEM:

None

RESOLVED:

That Cabinet:

1.    Approved the strategy for purchase and lease of residential accommodation as outlined in this report.

2.    Approved the development and incorporation of a Limited Liability Partnership for the purpose set out in this report.

3.    Approved the initiation of a market exercise by the LLP (with the Council’s approval as majority member) to select a suitable funder to provide financing on acceptable terms. Such offering will include as part of the transaction a registered provider associated with the funder as part of the same funding submission to the LLP. This will enable application of GLA Grant Funding. 

4.    Approved that an initial capital budget of up to £5m, funded from the capital programme contingency budget is agreed for the negotiated purchase price of the Residential Housing Units and associated costs within the Council’s Capital Programme.

5.    Delegated authority is given to the Corporate Director of Finance and Resources to agree individual property purchases.

6.    Approved that any potential deal will come back to Cabinet for a decision in advance of the transaction.

Reasons for decision

It was considered that the purchase of homelessness discharge accommodation is necessary for the Council to meet the increasing demand for the provision of temporary accommodation for the Borough and to meet the strategic, and financial objectives of the Council. These are explored in more detail within the main body of the report below.

By initially acquiring the Residential Housing Units for use in this scheme the Council will have the opportunity to drive up the standard of rental property for use for homelessness discharge, and to secure units specifically for the benefit of the Borough.

Alternative options considered

 5.1     Do Nothing - If the Council did not acquire Residential Housing Units, it is anticipated that the Council will have a considerable shortfall of homes to meet the growing needs of the Borough and will fail to meet a key part of its medium-term financial strategy (MTFS).

Direct Purchase of the properties by the Council – the Council already has an ambitious acquisitions programme for the purchase of properties. The purchase of the number of properties outlined in this report would add further debt onto the Council’s balance sheet, which is already high and above the average for similar authorities. In addition, the Council’s strategy for addressing the temporary accommodation crisis is to have a number of different initiatives in place and the proposal set out in this report would support that strategy.