Decision details

This report seeks to obtain approval to completion the acquisition of 368 properties for us as Temporary Accommodation

Cabinet approved the following recommendations:

·       Approves the acquisition of the Portfolio, as listed in Exempt Appendix A, from A2Dominion, into the Council and the disposal by on-sale and/or grant Page 288 (as applicable) from time to time of leasehold titles to homes within the Portfolio or (as applicable) other homes owned by the Council which satisfy the funder’s criteria, to Council owned entities established for the funding structure.

·       Approves the incorporation of a Limited Liability Partnership (the LLP) and other associated limited companies to create a funding structure satisfying the funder’s criteria (the Funding Companies which, for the avoidance of doubt, includes the LLP), bank accounts and administrative and legal matters required for the establishment of the Funding Companies and approves the governance arrangements, in line with Exempt Appendix C.

·       Approves entering into the arrangements to secure the funding, including the Council providing the required guarantee to the funder and the Funding Companies granting security to the funder over the Portfolio.

·       Approves the Council's acceptance of a lease(s) back of up to 368 properties of the Portfolio granted by the relevant Funding Companies, following the acquisition by the relevant Funding Companies.

·       Approves the authorisation of the Council’s Section 151 Officer and Monitoring Officer to issue certificates to the funder, in the form to be agreed with the funder, to certify compliance with applicable financial requirements and legal requirements (amongst other things) respectively and further authorises that both officers be indemnified (to the fullest extent allowed) in connection with the giving of such certificates

·       Delegates authority to the Executive Director of Finance and Resources and the Strategic Director of Housing and Commercial Partnerships, in consultation with the Cabinet Member for Housing and Finance & Council Reform, to confirm satisfactory completion of due diligence regarding the Portfolio, to confirm satisfactory completion of the negotiation and finalisation of the structure, terms and arrangements for the portfolio acquisition and the funding transaction such that the Council can reasonably proceed with the Portfolio acquisition and the funding transaction, and to approve the entry into all legal agreements and associated documents, and undertake all other necessary actions to secure the acquisition of the Portfolio and enter into the funding transaction, including the settlement of the rent dispute between the Council and A2Dominion and the other legal and financial arrangements.

Reasons for Decision: The Council has been using the Portfolio as temporary accommodation for over 15 years and has now been asked to acquire this stock. If the Portfolio was lost, it would inconvenience TA residents and result in a significant financial pressure to the Council. This acquisition also supports the Council’s longer term aims to acquire more directly owned TA and reduce its reliance on nightly booked accommodation.