Somerset Council declared a ‘financial emergency’ in early-November, and has been working on various strategies to reduce both a projected in-year overspend of more than £18m and a budget gap next year of £87m.
The council’s executive committee confirmed in early-December that it would be looking to sell off significant amounts of its existing land, property assets and commercial investments, believing this could generate up to £20m by April 2025.
Councillors have now revealed that the sale of assets could include the Saxonvale regeneration site in Frome town centre, with one local member claiming a “cash offer” was about to be made by the locally-based Mayday Saxonvale site.
The council has around 1,300 individual land and property assets, along with a large number of much smaller parcels of utility land.
A significant amount of these assets cannot easily be sold off since they deliver statutory services – such as schools and libraries – or are protected by legal conditions which make their sale unviable (including buildings constructed using government or EU funding).
Some of the other assets directly generated income for the council, such as car parks, crematoria and the commercial investments inherited from the four district councils in April 2023 – with decisions on these being taken on a case-by-case basis.
The council’s chief financial officer Jason Vaughan revealed in December 2023 that 16 sites had been sold in the financial year to date, and a further 74 sites had been identified as surplus and were in the process of being sold off.
Oliver Woodhams, the council’s service director for strategic asset management, told the council’s corporate and resources scrutiny committee in Taunton on Thursday morning (January 4) that the review of assets was currently focussing on four distinct areas:
- Non-operational assets, including disused properties inherited from the previous five councils
- Operational assets where the same services can be delivered in less space (e.g. selling off parts of existing council offices and depots)
- Land held for development, including those originally acquired for regeneration purposes
- Small parcels of surplus land with development potential
Mr Woodhams said: “We are being tasked by our chief financial officer to really put our foot down with regard to asset disposals.
“We don’t want to keep hold of empty buildings unless there’s a good reason for doing that.
“With our larger brownfield sites, we will be preparing parcels of those to be sold for regeneration efforts, such as Firepool and Saxonvale.
“We do not have a vast array of riches in our operational estates. We have a pretty healthy pipeline of £15m-£20m, and we know we could do more.”
Mr Woodhams revealed that asset sales in the current financial year had generated £4.7m of income for the council, with a further £2.9m expected by the end of the financial year.
An additional £8.5m of assets could be sold off by April 2025 – taking a total of £16.5m off the council’s projected budget gap.
A further £5.6m of assets could also be sold off within this period, bringing the total to £22.1m – but these are considered “higher risk”, meaning it may take longer to sell them for an acceptable price.
This review does not include the three battery energy storage sites which the council owns – which former council leader David Fothergill hinted in December 2023 could be sold off to fund the stalled regeneration of the Octagon Theatre in Yeovil.
Councillor Shane Collins, who represents the Frome East division, claimed that the council was already in the process of selling the Saxonvale site in Frome town centre to Mayday Saxonvale after the rivalling Acorn bid to develop the site was quashed by the High Court.
He said: “Saxonvale is of big interest to many of us. Since the Acorn application has been judged non-complaint, Mayday has put in a cash offer.
“For councillors in Frome, we would really like an update on what’s happening. It’s been setting there for 20 years.”
Councillor Ros Wyke, portfolio holder for economic development, planning and assets, confirmed there were “ongoing discussions” with the relevant parties surrounding the future of the site, but declined to go into further detail.
She said: “There is ongoing discussions with developers – there is planning involved and discussions with the town council.
“This is not the forum to discuss this, but as and when it becomes a public discussion you will be informed and involved.”
Mayday Saxonvale director Paul Oster stated after the meeting: “We are currently in discussions with Somerset Council regarding the Saxonvale site and are confident that the right decision will be made in due course.”
As of December 21, 2023, the council currently held the following freehold commercial investments:
- B&Q, Heathfield Road, Ayr
- Reflex Group, 29 Moat Way, Barwell
- FreeholdWickes Extra, Tameside Park, Birmingham
- Lyndon Place, 2096 Coventry Road, Sheldon, Birmingham
- The Leggar Retail Park, The Leggar, Bridgwater
- Unit 1, Dunball Industrial Estate, Trelleborg, Dunball, Bridgwater
- 600-650 Aztec West, Waterside Drive, West, Bristol
- 730 Aztec West, Waterside Drive, Bristol
- 430 Bristol Business Park, Coldharbour Lane, Bristol
- Applegreen Petrol Filling Station, Gloucester Road, Horfield, Bristol
- 27-29 Sherwood Road, Bromsgrove
- Audi Cardiff, Wagtail Close, Cardiff
- Unit 1, New House Farm Industrial Estate, Mathern, Chepstow
- D1, Christchurch Business Park, Radar Way Christchurch
- Centurion Mill, Kestrel Way, Sowton Industrial Estate, Exeter
- Howmet Ltd, Sowton, Exeter
- Unit 2B, Commerce Park, Frome
- Fenick House, Lister Way, Glasgow
- B&Q, Wirrall Park Road, Glastonbury
- Costa Coffee, Wirrall Park Road, Glastonbury
- Units 1 and 2 Barnwood Industrial Estate, Barnwood, Gloucester
- The Range, Pellon Lane, Halifax
- The Ralph Globe Business Park, Fourth Avenue, Marlow
- Bell House, Seebeck Place, Knowlhill, Milton Keynes
- Reevesland Industrial Estate, Caswell Way, Newport
- Imperial House, Imperial Way, Coedkernew, Newport
- North Shields Retail Park, Norham Road, North Shields
- Reflex Group, Smith Way, Ossett
- 54 Willis Way, Poole
- Cornwall Food Production Unit, Barncoose Industrial Estate, Barncoose, Redruth
- JLR, Concord Way, Stockton-on-Tees
- Steelite, Newcastle Street, Stoke-On-Trent
- Street Retail Park, Gravenchon Way, Street
- DFS, Wootton Basset Road, Swindon
- Trafalgar House, Cornishway North, Galmington Trading Estate, Taunton
- St John’s Retail Park, Priory Way, Taunton
- Boots, 93-94 Pydar Street, Truro
- Alchemy, Alchemy House, Bessemer Road, Welwyn Garden City
- TK Maxx, 48-50 High Street, Worcester
- Marks & Spencer, 5 Middle Street, Yeovil
- Wilko, 88-92 Middle Street, Yeovil
In addition, the council also holds the following leasehold investments:
- One Quinton Business Park, The Ridgeway, Birmingham
- The Square car park, Richmond Hill, Bournemouth
- The Clink Retail Park, The Leggar, Bridgwater
- Jacobs Building (excluding Linden House), 23 Berkeley Place, Bristol
- The Fermentation Building, Hawkins Lane, Redcliffe, Bristol
- King William House, 13 Queen Square, Bristol
- Faringdon Retail Park (Phase II), Henry Blake Way, Faringdon
The three battery energy storage schemes (one in Taunton, two in Fareham) are run on a joint venture basis with SSDC Opium Power Ltd., with the council providing loans from each site which are repaid through dividends.
As of March 31, 2023 (the most recent figures available), the council is owed more than £8m from the Taunton site (on an original loan of just over £13m) as is owed around £26m across from the two Fareham sites (from an initial loan of more than £29m).
Further details on the council’s draft budget proposals will be discussed by the executive committee in Taunton on January 15.