NEWS

Clifton Hill sports centre site - with adjacent green space - and Mary Arches car park set for sale for PBSA

Reversal of policy to prohibit Purpose Built Student Accommodation on city council land proposed to cover expected £9 million outstanding Exeter City Living debt, with £800,000 budget proposed for site disposal costs.

Martin Redfern

Exeter City Council is proposing to sell the site of the demolished Clifton Hill sports centre and its adjacent green space as well as Mary Arches Street multi-storey car park for redevelopment, with both sites likely to end up as student accommodation.

The sale proposals follow the council’s decision to all-but wind up Exeter City Living, its subsidiary property development company, after the company made cumulative losses of more than £4.5 million.

The company bought the Clifton Hill sports centre site from the council for £2.14 million, half its market value, in January 2020. It planned to build 31 luxury townhouses for private market sale alongside eleven “affordable” flats there, but twice failed to find a development delivery contractor.

It also intended to build around 100 flats for private market rent on the site of Mary Arches Street car park after buying it from the council, but the sale has not taken place.

Mary Arches Street car park development site Mary Arches Street car park development site

  • Redevelopment requires vacant possession of North Street flats, CPO may be required
  • Government Brownfield Land Release Fund award of £1,310,000 for demolition/preparation
  • Brownfield funding criteria not met, 31 March 2024 land sale/works start deadline
  • Adjacent surface car park originally intended for inclusion in sale but requires archaeological dig for Roman remains

Exeter City Living currently owes the council £10.1 million against loans the council made to the company to finance its activities and purchase the Clifton Hill sports centre site.

Once the company is all-but wound up (its shell will be kept to manage six rented flats in the Guildhall shopping centre) around £9 million of its debt to the council is expected to remain outstanding.

The council will acquire the company’s assets, including the Clifton Hill site, which are valued at £3.7-£4 million.

It will write off the remaining loan balance of around £5 million. (£1.3 million more than Mid Devon District Council is expecting to write off in relation to its failed development company.)

It then proposes to sell the Clifton Hill site, as well as its adjacent green space, and the Mary Arches Street multi-storey car park, but not its adjacent surface car park, to cover as much of the outstanding £9 million as possible.

However the council will have to sell both sites with planning permission for high-yield redevelopment schemes for it to raise the £9 million it needs.

Clifton Hill sports centre development site Clifton Hill sports centre development site, adjacent green space visible at rear

The city council has commissioned several valuations that compare estimated sale values for redevelopment in each of several scenarios for two variations of each site.

One set compares the prospective values of the Clifton Hill sports centre site and its adjacent green space, as well as the prospective values of the whole Clifton Hill site including the golf driving range and ski slope, for redevelopment as affordable housing, as residential housing, as co-living and on an unrestricted basis.

Another set compares the prospective values of the Mary Arches multi-storey car park, as well as the prospective values of the Mary Arches multi-storey car park and its adjacent surface car park, for redevelopment as residential housing, as co-living and on an unrestricted basis.

It has not published any of these valuations, citing commercial confidentiality.

But the report it has published says, without including any of the details, that various sale variations (which exclude the affordable housing scenario) would, in combination, cover the outstanding Exeter City Living debt.

It also includes the caveat that the council may get more – or less – for the development sites when it takes them to market.

Proposed Mary Arches Street car park development site sale boundary map Proposed Mary Arches Street car park development site sale boundary

The report nevertheless recommends the sale of the smaller portions of both sites on an unrestricted basis.

It does so not least because their redevelopment as high-density, high-profit Purpose Built Student Accommodation is likely to fetch the maximum price for the minimum loss of council assets.

In particular, it says Mary Arches Street multi-storey car park site is likely to be worth around 70% less if sold for any other purpose.

(It does not mention that the heavy machinery required to demolish large concrete structures is not readily available in the South West, undermining viability and so the value of such sites. Hence the old bus station beside St Sidwell’s Point is still standing more than two years after its replacement was opened.)

And the viability assessment Exeter City Living commissioned to justify the removal of the affordable housing requirement it initially agreed at Clifton Hill also found that this site would be worth most for redevelopment as student accommodation.

The report suggests this unrestricted sale option might allow the council to raise not only the £9 million it needs but more besides, which it could use for other capital projects while avoiding the risk of having to sell any more land or assets to cover the outstanding Exeter City Living debt.

Proposed Clifton Hill development site sale boundary map Proposed Clifton Hill development site sale boundary

The council report also proposes the creation of an £800,000 budget to pay for the costs involved in selling the sites.

Among other things, these are expected to include the cost of the council using its compulsory purchase powers to ensure vacant possession of property in North Street that would be included in the Mary Arches Street multi-storey car park sale.

The city council Executive committee will decide whether to agree the proposals at its meeting on Tuesday.

A meeting of the full council follows on 12 December at which the Executive decision is expected to be approved.


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