Decision Reference Number: WPCC4-0022
Lead Officer: Calum Walmsley
Chief Officer approval: ACC David Gardner
Date: 28/08/2024
Status: Partially-confidential
If partially-confidential or confidential please detail the FOI exemption applied and specify which parts are confidential:
Attachments are exempt from disclosure under S.43 (commercial interests) of the FOIA as relating to commercial interests.
Decision summary:
This decision notice is for approval of entering into a lease agreement for the premises at Southam Tithe Lodge for 10 years (With a 5 year break clause).
I confirm that my register of interests declaration is up to date and that none of my interests preclude me from making this decision.
Signature: P.Seccombe
Date: 26/09/24
Supporting information
1. Background information
The Police and Crime Commissioner for Warwickshire entered into a lease agreement for the Safter Neighbourhood Team (SNT) office at Southam Tithe Lodge on 25th September 2015 for a period of 9 years. The lease is set to expire on 25th September 2024.
The OPCC were contacted by a commercial representative of the landlord, Orbit Housing, to renegotiate the lease for this office.
The office is sited as part of a wider building built circa 2015 on the High Street in Southam, providing community facilities, such as a library and community store, and backs onto an extra care development all owned by the landlord.
The office houses facilities for the SNT to access ICT, and welfare including changing areas and storage. The office is accessed via 2 secure entry points, has a covered outdoor area however does not have public facing facilities.
The premises offer modern facilities and adequate space for the requirements of the team based there.
Consultation has been undertaken with ACC David Gardner to assess the operational policing need of the premises. ACC David Gardner has confirmed that there continues to be a requirement for this office space in this location.
The impending open market sale of the former Southam Police Station, which is located next to this office, further compounds the requirement for this type of facility in the locality.
The nearest alternative SNT base for the East of the County is located at Leamington Spa. However, there is an ongoing project for the development at Lighthorne Heath for a new SNT drop in facility as part of a community use building. Please see appendix 3 for a location map. Therefore, this office location continues to offer suitable accommodation to serve the East of the County.
The proposed lease term is for a period of ten years. It has been requested that a break clause be introduced for either party to end the lease with 6 months’ notice at year 5. Orbit have confirmed they are agreeable to the inclusion of this. This has been included to give the option of terminating the lease to relocate to the new Lighthorne Heath facility once constructed.
All terms of the existing lease will remain, as it is proposed that it is dealt with by way of a renewal lease. This proposed methodology will save on legal costs associated with the drafting of a lease. There are no contentious clauses or obligations within the lease which would prevent the OPCC from undertaking this.
The renewal lease will vary the following items from the original lease:
- The term of the lease –A term of 10 years with 5-year break clause with 6 months notice.
- The rent review dates – To be set as September every three years
- Mechanism for rent review – To be altered from RPI to CPI linked increases.
The change from RPI to CPI is now considered a normal approach and aligns with the Government’s objective to phase out RPI by 2030, for which this lease will be affected should it run for the entire 10-year term.
Generally, CPI tracks lower than RPI as the calculation used for RPI includes the costs of home ownership. Therefore, as tenant we should benefit from this limiting the rental uplifts, dependant on the wider economic landscape.
2. List of additional information attached as appendices
Appendix 1 – Email from David Gardner Supporting the lease agreement.
Appendix 2 – Comparable lease properties available on open market as of August 2024 within the vicinity of exiting base.
Appendix 3 – Location plan of Southam SNT office.
3. Expected benefits
The agreement to enter Heads of Terms for a further lease for this property ensures that operational policing teams continue to have a facility in the east of the County to operate from.
The extension of this lease will ensure service continuity without potential disruption for relocation. It also minimises fit out costs for locating the office to alternative accommodation.
4. Impact of not approving the application
Alternative accommodation in this locality will be required to be sought.
As attached in Appendix 2 there are currently no suitable alternatives available within 5 miles of Southam for a similar cost for a similar sized and suitable office space.
5. Costs (including any identified savings)
The current lease costs for 2024/25 are: £12,770.52
The initial lease cost is proposed at £17,000 per annum (Exclusive of service charges).
The proposed rent formula is based on the rent at initial let in 2015, inflated by RPI annually up to the expiry of the current lease resulting in a rent charge of circa £17,000 per annum.
Service charges are referred to within the lease, however, none have been charged since the lease was granted in 2015. It is therefore difficult to estimate the potential costs in this, if they are ever charged.
Therefore, the total anticipated cost of the lease of this premises per annum is circa resulting in a net increase of £4229.48 per annum.
6. Equality considerations
The property is accessible, via level access, for staff or visitors with disabilities, and meets the requirements of Part M of the building regulations in 2015.
7. Legal comments
Legal have not yet been instructed to act on this lease negotiation. However, it is anticipated that Bevan Brittain will be instructed for this transaction.
- Social or Environmental considerations
A revised EPC is being commissioned for this property as part of the letting process.
9. Publication
Information in this form is subject to the Freedom of Information Act 2000 (FOI Act) and other legislation. Unless the information provided is covered by an exemption, the information contained in the form will be published on the Warwickshire PCC website.
Comments from the Treasurer
The renewal of the lease is required to meet operational policing needs. There has been an uplift in the lease costs, but these are in line with expectations, although there remains some uncertainty regarding service charges. The additional lease costs will need to be included in the 2025/26 budget and across the medium term financial plan.
Comments from the Chief Executive and Monitoring Officer
This lease fits in with the requirements for operational policing
