Agenda item

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 areas of risk: the financial exposure and the risk associated with the interim use of the building.

4.   Further clarification was sought on what would happen in a worst-case scenario, specifically whether the building could be let to provide an income.

5.   Reassurance was requested from officers that the site could be let to mitigate potential losses, noting the significant risk to the council if the put option detailed in paragraph 2.3 was not exercised.

6.   A question was asked regarding the timing gap before planning permission was granted, and what steps would be taken to ensure an income stream during that period.

Delivery Confidence and Timing

1.   A question was asked as to why Jigsaw had chosen not to proceed with the purchase directly, resulting in the council having to acquire the building first.

2.   A question was asked regarding what assurances could be provided that the programme remained on schedule, and how risks of delay were being mitigated,

3.   A question was asked regarding the confidence in securing meanwhile uses and whether there was a timescale beyond which other options should be considered.

The committee agreed to move into an exempt session to consider the exempt appendix, during which further questions were raised which included the following: the valuation provided, de-risking the “worst case scenario”, the linkage to the wider CWR project, any impact to the council’s capital expenditure, the put option and de-risking any reputational risk.

The points from the open and exempt sessions were responded to by Councillor Martin Tod, Leader and Cabinet Member for Regeneration, Neil Aitken, Service Lead: Finance and Deputy Section 151 Officer, Geoff Coe, Corporate Head of Asset Management, Ken Baike, Director of Regeneration, Simon Hendey, Strategic Director, Councillor Neil Cutler, Deputy Leader and Cabinet Member for Finance and Transformation and Laura Taylor, Chief Executive accordingly.

RESOLVED:

That the substance of the committee's discussion and the points as summarised above be reflected in the comments provided to cabinet for consideration at its meeting on 28 May 2026.