Posted: Mon 9th Mar 2020

Costs approaching £1m for council on unused industrial units planned for HGVs – but floor can’t take the weight of vehicles

North Wales news and information
This article is old - Published: Monday, Mar 9th, 2020

Costs for industrial units which can’t be used for the reason they were leased have spiralled to almost £1m – and no one has been held publicly accountable.

Conwy council took up a 35 year lease, on units 6, 7, 8 and part of unit 5 at Mochdre Commerce Park on Conwy Road, in February 2016.

The idea was to move all of the authority’s HGV vehicles and equipment under one roof, from nine other sites across the county, in a bid to save cash.
However the floors couldn’t take the weight of the vehicles and the council was stuck with a building that is unfit for purpose.

The site costs the council £240,000 per annum under the agreement – exclusive of VAT and paid quarterly. The annual rent equates to around 0.43% of the current council tax revenue.

Conwy council confirmed to the Local Democracy Service it has paid £420,000 plus another £33,684 in service charges since June 2018. That is in addition to £391,500 paid in rent between February 2017 and June 2018.

On top of the £845,184 paid in rent and service charges, the council instructed solicitors DWF LLP to write a report about the debacle, which the authority refuses to release. The law firm has been paid more than £90,000 to date according to a Freedom of Information (FOI) request.

The council confirmed all business rates paid on the dormant building had been repaid to it and “there is no ongoing liability”.

A spokeswoman for Conwy council said: “The report has not been released. It contains commercial and critical information about individual employees of the council and may reveal the identity of others.

“It also relates intrinsically to the commercial/business affairs of the authority and other parties and disclosure may well adversely affect individuals and the council’s commercial interests and is exempt from disclosure under the Freedom of Information Act.”

The report was presented to a special meeting of Conwy council’s Finance and Resources Scrutiny Committee in March last year.

It admitted there were “process failings” in the way the agreement was taken on. Leader Sam Rowlands called it “a sobering read”.

The authority refuses to reveal if anyone has been held to account over the failure. The council’s spokeswoman said it “does not comment on staff disciplinary issues”.

There have been no developments on negotiations with the landlord since August last year but the authority said it is hopeful of a solution.

The spokeswoman added: “The landlord and the Council remain in dialogue and are committed to finding the best solution to the issues at Mochdre Commerce Park.

“A number of options are actively being considered and as further information becomes available both parties hope to be able to focus on the preferred option in the coming months.”

The original landlord, Conygar Strand Ltd, changed its name in 2017 to RR Sea Strand Limited, according to Companies House. The previous directors left at that time and two new directors were appointed.

RR Sea Strand Ltd’s annual accounts say it is ultimately owned by Guernsey-based Regional REIT Limited.

The parent company has a portfolio of 149 properties worth £721.7m. Its annual rental income is £57.8m.

The rent for the council’s portion of Mochdre Commerce Park can be reviewed every five years under the terms of the lease and there is a break clause inserted at 15 years.

That means, if the company doesn’t budge, tax-payers will be funding the building until 2031 – costing £3.6m plus service charges.

By Jez Hemming – Local Democracy Reporter



Spotted something? Got a story? Send a Facebook Message | A direct message on Twitter | Email news@north.wales

More...

Denbighshire village set to expand with 22 new homes at former training centre

Denbighshire

Denbighshire Responds to Care Home Owner’s Criticism of Council Leader

Denbighshire

Eco-friendly underground dwelling plans near Menai Strait set to go before Anglesey planners

Anglesey

Conwy to Introduce Parking Charges at Free Car Parks After Budget Cuts

Conwy

Councillors call for more gritting on Great Orme roads

Conwy

Plans Submitted to Create Studio Flat Above Fast Food Restaurant on Wrexham’s High Street

Wrexham