Seaway Project

Questions and Answers

Why is the council looking to take this scheme forwards?

If planning permission is granted and the scheme progresses, it would generate a significant rental income to the council and bring in a considerable annual sum through business rates.

The scheme would also regenerate this area with significant private investment, create hundreds of new jobs, boost the local economy and attract more people to this area of the town. With this in mind it is clear that the Seaway Leisure scheme would deliver overwhelming economic and community benefits to Southend-on-Sea, delivering an exciting new year-round, all weather leisure and parking facility for local residents and visitors.

Why has the council sold the Seaway car park for £1?

The land has not been sold for £1. The council is proposing to grant a lease of the land, but will retain freehold ownership.

The council's return would be through a commercial rent for tha land (see below). A notional premium of £1 would be paid when the lease is entered into. The lease has not yet been entered into.

Will the council be losing money compared to the current parking income? I have seen that the car park makes the council over £600,000 a year?

No this is not correct. Whilst the Seaway car park took £607,192 in income between April 2017 and March 2018, when you deduct VAT, business rates and costs such as enforcement, collection of money and maintenance of equipment, the net income (profit) to the council was £396,974.

On the grant of the lease, Turnstone would pay a minimum rent of £282,000 p.a. to the Council, all the way through the development phase and after the scheme opens. This rent is equal to the net income that the Council received from the site at the time the Agreement was entered into. Over the 152 year lease period this equates to £42.9m at current values in commercial rent alone. The Agreement also provides for regular rent reviews linked to all the rents paid across the whole scheme.

The Council will also receive very significant business rates income from the scheme on top of this figure. At the current time we conservatively estimate this will be worth £750,000 a year to council at the start of the project, rising to £1.1m in the near future.

This combined and stable rental income and business rates of approximately £1.03m will far exceed the current parking net income of £396,974.

Alongside this, the council's costs will also be reduced, as the scheme will be privately managed and all the running and maintenance costs will fall to the development rather than the council.

Can the council end the agreement after four years?

Subject to complying with the terms of the 2014 agreement, there are provisions giving either party the opportunity to serve a notice to terminate the agreement after the fourth anniversary on 10 December 2018.

As a planning application was submitted before 10 December 2018 it was considered to be unreasonable for the council to pursue termination in the short term, not least because the Agreement requires both parties to act in good faith towards each other. In any event it is still a council objective to see the Seaway site developed with all the consequential benefits set out above.

On 17 January 2019 a detailed cabinet report was considered that you can read on our democracy pages (minute 605). At that meeting cabinet agreed a recommendation  to not seek to terminate the agreement at the current time and to extend the contract ‘end date’ of 10 December 2018 to 17 January 2020.

What about car parking?

At the time of the parking survey in May 2016, 478 spaces were recorded at Seaway Car Park. This is the baseline figure used in the Southend Central Area Action Plan (SCAAP) which was adopted in February 2018.

The relocation of the coach parking by the council gave the opportunity to provide some temporary car parking (183 spaces), rather than leaving the area vacant pending development. It was sensible to provide some temporary parking facilities for the public and to support local businesses, and at the same time raise further parking income for the council.

There have been some suggestions that the baseline car parking figure is therefore now 661, but this argument was not accepted by the SCAAP planning inspector who agreed that the baseline parking figure for Seaway in the approved SCAAP (and used as the basis for planning policy) should be 478 spaces.

The scheme will include a substantial publicly available surface and multi-storey car park providing well in excess of the contractually required 480 parking spaces. Details of car parking proposals will be contained within the planning application and considered through the planning process.

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