Issue - meetings

1.      That the Strategic Director with responsibility for Central Winchester Regeneration be authorised to complete the acquisition of the former St Clement’s Surgery for the amount of £2.75m plus SDLT (£127,000) and fees (£20,000).

2.      That a supplementary capital estimate of £267,000 be approved, funded by prudential borrowing (£140,000) and capital receipts (£127,000), bringing the total approved budget to £2,877,000.

3.      That capital expenditure of £2,877,000 be approved for the acquisition of the former St Clement’s Surgery.

4.      That an ongoing revenue budget of £53,200 be approved for security, business rates, maintenance, and utilities until such time a lease to Jigsaw is in place.

5.      That the Strategic Director with responsibility for Central Winchester Regeneration and Director Finance be authorised to negotiate and finalise the terms of an option agreement for the former St Clement’s Surgery with Jigsaw.

6.      That the Strategic Director with responsibility for Central Winchester Regeneration be authorised to explore meanwhile uses of the former St Clements Surgery with Jigsaw and to agree an approach that best mitigates the holding costs.

Councillor Tod introduced the report, stating that the proposal offered an opportunity to acquire an important site in relation to the CWR scheme but emphasising that the acquisition was not essential to the scheme progressing.  He advised that the report had been considered at Scrutiny Committee on 26 May 2026, the draft minutes of which had been circulated to all members present. 

At the invitation of the Leader, Councillors Lee, Horrill and Wallace addressed Cabinet as summarised below.

Councillor Lee

Councillor Lee referenced useful discussions at Scrutiny Committee and asked whether if the former St Clements Surgery site was acquired, the council was achieving best value for taxpayers given the total acquisition and holding costs.

Councillor Horrill

Councillor Horrill emphasised her long-standing support for CWR but raised serious concerns about why the council was assuming acquisition risks rather than Jigsaw. She questioned the decision to proceed without a full building condition assessment or a detailed plan for meanwhile use to cover short-term financing and holding costs. Finally, she sought evidence that public funds were not effectively subsidising Jigsaw and called for absolute clarity to ensure decisions on the scheme remained transparent and deliverable for residents.

Councillor Wallace (Chair of Scrutiny Committee)

Councillor Wallace reported that the Scrutiny Committee recognised the strategic opportunity to enhance the CWR scheme’s design flexibility and coherence by acquiring the former St Clement’s Surgery site. He noted that while the acquisition was not essential for delivery, it would prevent a poor-quality building from remaining at the heart of the development. However, he raised serious concerns regarding the council’s potential financial exposure, specifically the risk of holding a non-performing asset and the impact of borrowing on the wider capital programme. Finally, he urged Cabinet to weigh these risks carefully and ensure that the decision-making process remained transparent and beyond reproach.

Councillor Tod, the Strategic Director and the Director of Regeneration responded to the points raised including confirming that the option agreement obliged Jigsaw to buy the site and they were confident meanwhile uses could be achieved.

The Director (Finance) emphasised that there remained some unknowns in relation to the option agreement including the length of time prior to the put option and the number of residential units and amount of commercial floor space.  She also highlighted the potential risks to the council if the market value of the site was to decrease, or if Jigsaw were to become insolvent.  She stated it was a decision for Cabinet to weigh up the risks against the benefits to the overall CWR scheme of the proposed acquisition.

The Strategic Director highlighted that paragraph 11.12 set out the main elements to be included within the option agreement and that whilst this had not been finalised yet, a minimum number of residential units and commercial floor space would be included. 

Cabinet discussed the content of the report in detail, with particular reference to the financial risks involved and the potential wider benefits of the acquisition.

Cabinet and invited councillors present  ...  view the full minutes text for item 9

RECOMMENDATION:

It is recommended that scrutiny committee comment on the proposals within the attached cabinet report, ref CAB3556 which is to be considered by cabinet at its meeting on the 28 May 2026.

NOTE

This report contains an exempt appendix (Appendix 2), if members wish to discuss any part of this exempt appendix, then the procedure under agenda item 7a (below) applies.

Councillor Martin Tod, Leader and Cabinet Member for Regeneration introduced the report, ref CAB3556 which set out proposals for the Central Winchester Regeneration (CWR) - Proposed Land Acquisition. The introduction included the following points.

1.    The Central Winchester Regeneration remained a significant opportunity for the city to provide new homes, businesses, and public spaces.

2.    The St Clements surgery site was not included in the original development agreement, and while not essential for current plans, its acquisition would prevent a dilapidated building from remaining in the centre of the new development.

3.    Acquiring the site would remove barriers to free movement, expand design and development options for surrounding areas, and resolve protected rights to light and access.

4.    The acquisition would strengthen the value of the council's existing landholdings through “marriage value.”

5.    A put option was outlined in paragraph 2.3 of the report, which committed Igloo to purchasing the site, thereby providing financial protection for the council.

Councillor Danny Lee addressed the committee. He raised concerns regarding whether the acquisition de-risked the wider scheme or shifted financial risk onto the council. He questioned the robustness of the option agreement with Jigsaw, the downside risk if the put option was not exercised, and the potential exposure to long-term debt. He raised several further points regarding the realistic deliverability of meanwhile uses for the building, and whether Local Government Reorganisation (LGR) could complicate future governance and liabilities.

The committee was asked to comment on the proposals within the attached cabinet report, ref CAB3556, which was to be considered by cabinet at its meeting on 28 May 2026.

The Chairperson advised that the Committee's role was defined as to test whether the specific proposal was sound and proportionate, and not to revisit the overall regeneration strategy. The Chair asked Members to focus scrutiny on three key areas to provide constructive input to Cabinet: Strategic Case, Financial Exposure and Delivery Confidence and Timing.

The committee proceeded to ask questions and debate the report. In summary, the following matters were raised, grouped in line with the key areas identified by the Chairperson.

Strategic Case

1.   Clarification was sought to confirm that this land was not required for the Central Winchester Regeneration project to succeed.

2.   It was asked whether a professional opinion on the condition of the building had been obtained.

3.   Further clarification was sought regarding potential meanwhile uses for the building.

4.   Further clarification was sought on whether demolition at the initial stage had been considered, rather than leaving the building in its current state.

5.   An explanation was requested regarding the two title plans, specifically regarding the second plan showing a small triangle of land.

Financial Exposure

1.   A question was asked to confirm that the purchase could be funded using internal borrowing rather than external finance.

2.   Clarification was sought on what justified the current valuation of the site, considering the amount paid by the current owner and previous offers made by the council.

3.   Concerns were raised regarding two  ...  view the full minutes text for item 7