A DEBT-RIDDEN council’s plan to sell almost half of its properties and land, including a Basingstoke cinema, in a ‘timely manner’ has been approved by cabinet.
Senior councillors at Slough Borough Council agreed on a plan to “speed up” the selling of it its £600m-worth of assets to reduce its £760m borrowing debt and £479m blackhole.
It is hoped by selling nearly half of its £1.2bn asset portfolio, it will take its borrowing debt to a sustainable level by April 1, 2027.
Its portfolio includes the Odeon cinema as Basingstoke Leisure Park.
To dispose of the assets in a ‘timely manner,’ a cabinet committee will be set up to decide on the sale of assets on a case-by-case basis. Council leader James Swindlehurst (Lab: Cippenham Green) will appoint members to this committee.
The report will go to July’s full council meeting for final approval.
The four out-of-borough assets, including the Odeon Cinema in Basingstoke, which was bought as a revenue generator, are among the first wave of properties to go.
Speaking at the cabinet meeting on Monday, June 20, Cllr Rob Anderson (Lab: Britwell & Northborough), lead member for financial oversight and council assets, said: “We believe there’s no reason to hang to those [out-of-borough assets] and will reduce our risk considerably if we get those off the books as quickly as possible.”
Followed on from that, the council will be selling its in-borough properties and land. However, this concerned Cllr Wayne Strutton (Con: Haymill & Lynch Hill), believing the local authority won’t get a good return from those sales if it “sits on them for too long”.
READ MORE: Slough Council creates plan to sell assets in 'timely manner' including Odeon cinema in Basingstoke
He said: “If we sit on them too long, we could lose and go into negative equity because of the amount of money we’re paying in additional interests if the interest rates go up or we can’t renew some of our short-term low-cost interests.”
Cllr Swindlehurst said they have drafted in commercial advisor Avison and Young to advise the council when is the right time to sell their assets for the best value.
Meanwhile, Cllr Anderson said most of the in-borough assets are development sites, meaning they are “more complicated” and “will take longer” to be sold off.
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He also said the out-of-borough assets are returning their expected yield “broadly speaking,” but because of the size of the council’s debt, they present a risk as their value could drop or the tenants may not pay their rent.
It is expected Avison and Young will produce their first report to senior members at the end of the month on how the council should proceed with its large-scale asset disposal programme.
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