The Property Services Manager reported that the Council periodically reviewed the costs and benefits of retaining the building compared with the costs and benefits of alternative accommodation. At the latest review in October 2009 it was concluded that the most cost effective option for the Council was to remain in the Argyle Road offices but to increase occupancy rates where possible to make best use of the asset. 50% of the annual cost was non domestic rates, the building had been designed for one user and it was difficult to split it up due to the heating and ventilation systems.  A number of developments were due to take place shortly, or were being considered, that would make further improvements in the use of the building and were outlined in the report.  Further to this, talks were taking place with Kent Social Services and the Chamber of Commerce.  It was not possible to start work on the area vacated by Environmental Health until April 2012 due to IT issues.

A Member asked whether there was an increased risk by having non-council staff within the building.  The Property Services Manager replied that he had checked this with the insurers.  There would be an increased risk if it were commercial organisations, but this would be difficult to achieve anyway, and the physical risk was reduced by the Police presence.  He advised that all staff from MOAT were CRB checked and there were relevant clauses in the agreements to deal with any problems.  The MOAT and Police IT systems were separate and therefore the Council’s  IT infrastructure was not vulnerable. 

A Member queried the amount of letting space available.  The Property Services Manager advised that it was limited without a large investment.

ACTION 4:     The Property Services Manager to inform Members of the amount of letting space available.

Members were concerned by the lack of rent paid by the Police.  In response to questions the Property Services Manager responded that the Police only paid running costs as they put in a significant amount of capital paying for all the work undertaken that also benefited the Council in the long term.  MOAT was a better example of the usual transaction.  The Chief Executive explained that the Police had been looking to move into their own premises at Swanley and Edenbridge, but approached the Council as they wished to keep a presence in Sevenoaks.  It was agreed by Council that on top of the capital outlay they would move in and pay running costs, not rent, with the proviso that when they no longer paid for their rented accommodation in Sevenoaks a rental agreement would then be revisited.  This was due to be reviewed as part of the rental negotiations for the proposed new Police Office.  A Member was not happy with the commercial basis on which this has been done.  Another Member wondered whether the cost of CCTV could be met as part of the reciprocal costs.

The Property Services Manager advised that the Cabinet Member for Finance and Value for Money would approve any rent agreed based on the cost of works with payback within the occupancy period. At the moment they were looking at a ten year lease with an 8% return but this depended on the tender price, which would be brought before Members once received.  In response to questions he replied that there would have to be break clauses built into the contracts.  The Chief Executive advised that the running costs of the Argyle Road accommodation were fixed whether the space was let or not, so there was a benefit in real terms by having them filled with a contribution to running costs.

Resolved:       That

(a) a further report be brought back with an update on the new Police Office and a more in depth consideration of value for money in the letting process; and

(b) the report be noted.