Agenda item

Report of the Leader and Cabinet Member for Strategic Growth attached.

Councillor Eamonn O’Brien, Leader and Cabinet Member for Strategic Growth, presented the report which set out the Prestwich Village Regeneration Scheme that will deliver a comprehensive redevelopment of the Prestwich Village site including the Longfield Centre.

Decision:

Cabinet:

1.    Note the progress made with the development of the overall Prestwich Village Regeneration scheme (the Scheme).

2.    Approved the recommended legal structure and procurement strategy for the appointment of the developer for the Scheme and appointment of a contractor for delivery of Phase 1 of the Scheme as set out in the Part B report.

3.    Approved the commencement of a procurement process by the Council for the delivery of Phase 1A (Travel Hub) of the Scheme in accordance with the legal structure and procurement strategy set out in the Part B report.

4.    Approved the funding strategy to fund the delivery of Phase 1A (Travel Hub) to a maximum expenditure figure of £14m from the Council’s existing capital programme.

5.    Noted the treatment of The Prestwich Regeneration LLP as a contracting authority under the Public Contracts Regulations 2015 in the proposed legal structure and procurement strategy.

6.    Delegated authority to the Director of Law & Democratic Services in consultation with the Executive Director of Place and Leader to negotiate and complete detailed legal and procurement agreements associated with the delivery of the Scheme.  

Reasons for Recommendation(s) 

Legal Structure & Procurement Strategy:

• Cabinet approved the formation of a joint venture company (The Prestwich Regeneration LLP – The JV) with Muse Places Ltd (Muse) on 13th October 2021. This was on the basis that Muse had the benefit of an option agreement over a leasehold interest forming part of the Scheme and not as a consequence of any tendering procedure under the Public Contracts Regulation 2015 (PCR). Muse held an option to purchase the Longfield Centre and the Council relied on the “exclusive rights” exemption in Regulation 32 (2) (b) of the PCR.
• It is now proposed that the Council will appoint The Prestwich Regeneration LLP as developer for the Scheme.  The Council will make a direct award to Muse (via the Morgan Sindall Consortium LLP) via the Pagabo Developer Led Framework (Pagabo) and Muse will enter into a sub-Development Agreement with the JV.  The JV will subsequently use a PCR compliant procurement route to secure the services of a building contractor for Phase 1 of the Scheme. 
• Pagabo was established in 2020 and offers a pre-procured route which enables local authorities to appoint developers directly where pricing is transparent and agreed upfront. Each successful supplier on the framework has already been subject to quality and price competition.

Funding Strategy

• The Prestwich Regeneration LLP’s JV Management Board has agreed the principle of the funding approach recommended in this report at the meeting 13th May 2024.
• Funding of the project in line with option one described below is recommended.  This utilises existing funding provision within the Council’s Capital Programme and Medium-Term Financial Strategy (MTFS) to deliver Phase 1A of the Prestwich Village Regeneration Scheme. 
• Option one maintains momentum of delivery and ensures a key enabling phase of the scheme is completed under the published programme; releasing potential for housing growth on the site.  
• This strategy ensures the Scheme is ‘shovel ready’ increasing the attractiveness of the next development phase (Phase 1B) to external funders.  It reduces the impact of construction cost inflation and reduces the likelihood that the Council will incur significant asset holding costs at the site.

Alternative options considered and rejected:

• As set out in Part B of the report.

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