Disposal by Auction of 2 and 2A Balmoral Road, Rattray
Perth and Kinross Council · 18 November 2024
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PERTH AND KINROSS COUNCIL Property Sub-Committee 18 November 2024 Disposal by Auction of 2 and 2A Balmoral Road, Rattray Report by Strategic Lead – Economy, Development & Planning (Report no. 24/309) 1. PURPOSE 1.1 The purpose of this report is to seek approval for the disposal of 2 and 2A Balmoral Road, Rattray by sale as a single lot at auction. The value of the properties exceeds delegated officer authority as detailed in this report. 2. RECOMMENDATIONS 2.1 It is recommended that the Sub-Committee: i) approves the sale at auction as a single lot of 2 and 2A Balmoral Road, Rattray for Market Value, in compliance with the Disposal of Land by Local Authorities (Scotland) Regulations 2010; and ii) agrees that should the properties fail to sell at auction, they will be re-marketed for sale either at auction or by private treaty. 3. STRUCTURE OF REPORT 3.1 This report is structured over the following sections: • Section 4: Background/Main Issues • Section 5: Proposals • Section 6: Conclusion • Appendices 4. BACKGROUND / MAIN ISSUES 4.1 In May 2015 Property Sub-Committee considered and approved a disposal process for the auctioning of surplus properties (Report 15/203 refers). The process established that where auction has been identified as the most appropriate method of disposal, approval is required to proceed with the disposal at auction of properties valued above the delegated authority limit of £100,000 specified by the Scheme of Administration.
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4.2 Auction is an established method of disposal for appropriate surplus properties which incurs lower fees than conventional marketing and disposal. It exposes the opportunity to countywide coverage with a binding deal being struck when the auctioneer’s gavel falls. Since 2016, the Council has successfully disposed of more than twenty surplus properties at auction with the full legal process of disposal being completed within the following 28 days. 4.3 The property at 2 Balmoral Road is a ground and first floor level former Council Social Work office consisting of a number of cellular offices and staff accommodation, extending to 261 sqm or thereby. The property at 2A Balmoral Road is a first floor and attic level maisonette, being a former council flat, with the accommodation comprising three bedrooms and a living room, kitchen and bathroom. Both the office premises and the maisonette flat form part of a three-storey corner tenement block located at the junction of Balmoral Road and Boat Brae/High Street in Rattray. Within the same block there is also another flat which is now in private ownership, having previously been disposed of in circa 2003 by the Council under the Right to Buy legislation. The block is not listed or located in a conservation area. A location plan is included at Appendix 1. 4.4 The former Social Work office at 2 Balmoral Road has been vacant since 2018 and was declared surplus by the Council on 15th May 2018. 4.5 The maisonette flat at 2A Balmoral Road became vacant in 2018 as work including repairs to the external stair is required to return it to a habitable standard, the cost of which is prohibitive. 4.5.1 In June 2023, the Housing Service produced an SBAR (Situation, Background, Assessment, Recommendation) report to assess what would be required to refurbish the maisonette flat and also to convert the office at 2 Balmoral Road to provide additional social housing for the Blairgowrie and Rattray area. The report noted that there were other development sites in the vicinity, including social housing for rent by Kingdom Housing Association, and that the location of the building at the junction of two busy roads made conversion unattractive. The Housing Management Team (HMT) made the decision that the cost of conversion and upgrading works was prohibitive. 4.5.2 The Housing Service subsequently considered refurbishing the maisonette flat to accommodate Ukrainian refugees. However, this was considered unsuitable and was not progressed. 4.5.3 In July 2024, the Housing Service produced a further SBAR report to assess the maisonette flat at 2A Balmoral Road, with the outcome that it was declared surplus by the Council on 16th October 2024.
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4.6 The properties at 2 and 2A Balmoral Road are both held on a single title having been acquired by the Council in 1954. From a financial perspective however, the former Social Work office is held on the General Fund while the maisonette flat is held on the Housing Revenue Account (HRA). In line with the Disposal Consultation Framework for Housing Revenue Account assets, Council tenants in the locality of the properties were consulted in the autumn of 2023 and no objections were received. 4.7 The Market Value of the maisonette flat at 2A Balmoral Road has been assessed at being in the region of £60,000, and the Market Value of the office premises at 2 Balmoral Road has been assessed at being is in the region of £50,000. 4.7.1 The Market Value of the subjects (office and flat together) has been assessed at being in the region of £110,000. Since the properties would be auctioned as a single lot and this figure exceeds delegated approval, approval is required as per the Scheme of Administration to proceed with the proposed disposal at auction. 4.8 There are no current Community Asset Transfer requests or Expressions of Interest regarding the subjects in terms of the Community Empowerment (Scotland) Act 2015. 5. PROPOSALS 5.1 Officers propose marketing 2 and 2A Balmoral Road for sale as a single lot at public auction through Shepherd Commercial Property Auctions, with a reserve price set at no less than 75% of Market Value, in compliance with the Disposal of Land by Local Authorities (Scotland) Regulations 2010. 5.2 Should the properties fail to meet the reserve price, it is proposed to either remarket them for auction at a later date, or market them for sale by private treaty with agents appointed as considered appropriate, under terms to the satisfaction of the Strategic Lead (Economy, Development and Planning) and the Strategic Lead (Legal and Governance). Consideration would also be given to disposing of the office premises and maisonette flat as two separate properties.
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5.3 The Council is required to fulfil its statutory duties under Best Value as set out in Section 1 of the Local Government in Scotland Act 2003 (“the 2003 Act”). Relevant aspects of this duty include: • Making best use of public resources, including land and property. • Being open and transparent in transactions. • Ensuring sound financial controls are in place to minimise the risk of fraud and error. • Assessing the full financial consequences of decisions at an appropriate level before major financial decisions are taken or commitments entered into. • Demonstrating responsiveness to the needs of communities, citizens, customers and other stakeholders, where relevant. 5.4 The disposal of these surplus properties will generate capital receipts for the General Fund and HRA, with the net capital receipt being apportioned equitably between the two accounts in accordance with the separately assessed values of the properties, being 45% to the General Fund and 55% to the HRA. Disposal will also remove a revenue liability in terms of ongoing maintenance and other running costs. The market would be given the opportunity to return a vacant site to productive use. 5.5 The sale of these properties at auction, after a competitive bidding process, will comply with the Council’s requirement to fulfil its statutory duties in respect of Best Value and Best Consideration, along with the Council’s Disposal of Land and Buildings Policy. The properties will be advertised by the auctioneers as a single lot to expose the opportunity to a wide audience, and the auction process will take place under the direction of a qualified Chartered Surveyor to ensure competent governance. 6. CONCLUSION 6.1 The former Social Work office and the maisonette flat at 2 and 2A Balmoral Road have each been declared surplus by the Council. The Market Value of the two properties together exceeds the delegated authority financial limit specified by the Scheme of Administration and therefore approval is required to dispose of them at auction. It is recommended that the Sub-Committee approves the sale of the properties by auction subject to a reserve price, and furthermore approves, in the event that the properties fail to sell at auction, remarketing them at a future date for sale either at auction or by private treaty, under terms to the satisfaction of the Strategic Lead (Economy, Development and Planning) and the Strategic Lead (Legal and Governance).
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Author Name Designation Contact Details Alan Campbell Estates Surveyor ComCommitteeReports@pkc.gov.uk 01738 475000 Approved Name Designation Date David Littlejohn Strategic Lead – Economy, Development & Planning 6 November 2024 APPENDICES • Appendix 1 – Location Plan
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ANNEX 1. IMPLICATIONS, ASSESSMENTS, CONSULTATION AND COMMUNICATION Strategic Implications Yes / None Community Plan / Single Outcome Agreement None Corporate Plan Yes Resource Implications Financial Yes Workforce None Asset Management (land, property, IST) Yes Assessments Equality Impact Assessment None Strategic Environmental Assessment None Sustainability (community, economic, environmental) None Legal and Governance Yes Risk None Consultation Internal Yes External None Communication Communications Plan None 1. Strategic Implications Community Plan/Single Outcome Agreement 1.1 Not applicable. Corporate Plan 1.2 This report supports the following priority within the PKC Corporate Plan 2022-2027: - (i) Developing a resilient, stronger and greener local economy. 2. Resource Implications Financial 2.1 The disposal of these surplus properties will generate capital receipts for the General Fund and HRA, with the net capital receipt being apportioned equitably between the two accounts in accordance with the separately assessed values of the properties, being 45% to the General Fund and 55% to the HRA. Disposal will also remove a revenue liability in terms of ongoing maintenance and other running costs.
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Workforce 2.2 Not applicable. Asset Management (land, property, IT) 2.3 The Strategic Lead (Housing and Communities) has been consulted and indicated agreement with the proposals. 3. Assessments Equality Impact Assessment 3.1 Under the Equality Act 2010, the Council is required to eliminate discrimination, advance equality of opportunity, and foster good relations between equality groups. Carrying out Equality Impact Assessments for plans and policies allows the Council to demonstrate that it is meeting these duties. The information contained in this report has been considered under the Corporate Equalities Impact Assessment process (EqIA) with the following outcome: (i) Assessed as not relevant for the purposes of EqIA Strategic Environmental Assessment 3.2 The Environmental Assessment (Scotland) Act 2005 places a duty on the Council to identify and assess the environmental consequences of its proposals. No further action is required as it does not qualify as a PPS as defined by the Act, and is therefore exempt. Sustainability 3.3 Under the provisions of the Local Government in Scotland Act 2003 the Council has to discharge its duties in a way which contributes to the achievement of sustainable development. Under the Climate Change (Scotland) Act 2009 the Council also has a duty relating to climate change and, in exercising its functions must act: • in the way best calculated to delivery of the Act’s emissions reduction targets; • in the way best calculated to deliver any statutory adaptation programmes; and • in a way that it considers most sustainable.
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Legal and Governance 3.4 The Strategic Lead (Legal and Governance) has been consulted on the issues contained within this report. 3.5 The Market Value of the property to be auctioned exceeds the delegated authority financial limits specified in the Scheme of Administration and therefore Property Sub-Committee approval is required for this disposal. Risk 3.6 There are no direct risk implications arising from this report other than those reported within the body of the report. 4. Consultation Internal 4.1 The following officers have been consulted in the preparation of this report: • Strategic Lead (Legal and Governance) • Strategic Lead (Housing and Communities) • Strategic Lead (Economy, Development and Planning) • Chief Finance Officer External 4.2 Not applicable. 5. Communication 5.1 Not applicable. 2. BACKGROUND PAPERS 2.1 Report 15/203.