MD1593 Disposal of land at Beam Reach 8 to Evonik Degussa
Executive summary
GLAP wishes to dispose of a plot of vacant land at Beam Reach 8 in the London Riverside area to Evonik Degussa on a freehold basis. The land parcel is situated in the London Borough of Havering and adjoins existing land holdings of Evonik Degussa and would facilitate a new and improved access to their site. GLAP is seeking permission to dispose of the site to this special purchaser.
Decision
The Mayor approves the freehold disposal of Asset 03/021 at Beam Reach 8 to Evonik Degussa.
Part 1: Non-confidential facts and advice
1.1. GLAP holds a number of infrastructure assets in the Beam Reach 8 area, transferred from the London Development Agency (LDA) in 2012 under the Localism Act. Before the transfer, the LDA assembled industrial land at Beam Reach 5, 6 and 8 and CEME for disposal and development. To facilitate the disposal of development plots the LDA also invested in infrastructure provision, including roads and flood defences. These associated land parcels remained within LDA ownership and subsequently transferred to GLAP.
1.2. GLAP recently undertook a procurement exercise to select a development partner for the wider sites in the London Riverside area. However, the subject land did not form part of this portfolio because it was classed as an infrastructure asset and not a development opportunity.
1.3. GLA has been approached by Evonik Degussa, an existing land owner, regarding the purchase of the asset 03/021 Beam Reach 8 (as identified on the attached plan at Appendix 1). Evonik Degussa currently does not have a satisfactory access to its existing site and is constrained by surrounding watercourses and third party ownership. The purchase of the GLAP owned plot would enable the construction of a larger, vehicular entrance into the site.
2.1. The objective of the disposal is to reduce GLAP’s ongoing site management and maintenance costs and facilitate the growth of business and job creation in London Riverside. The plot of land is narrow and consists of verge which provides visual amenity but does not constitute a formal potential development plot. By disposing of the site GLAP will reduce its management liability and see the site maintained and managed by the owner-occupier.
4.1. Consideration
Evonik Degussa has provided GLAP with a Red Book Valuation of the site, carried out by Glenny (a local agency and surveying company) in accordance with the RICS code of valuation. GLAP appointed GL Hearn to undertake a review of Glenny’s Red Book valuation and provide advice on whether the consideration satisfies GLAP’s requirement to achieve Best Consideration when disposing of land. The advice note provided by GL Hearn is included at Appendix 2. This note has considered Evonik Degussa as a special purchaser and the potential for marriage value.
4.2. Planning
It is not considered that there are any planning impediments to the construction of the access.
5.1. Finance comments are contained in Part 2.
6.1. GLAP has been advised by Eversheds in relation to this disposal.
6.2. Section 30 of the Greater London Authority Act 1999 (as amended) (GLA Act) gives the Mayor a general power to do anything which he considers will further one or more of the principal purposes of the GLA as set out in section 30(2) which are:
• Promoting economic development and wealth creation in Greater London;
• Promoting social development in Greater London; and
• Promoting the improvement of the environment in Greater London.
6.3. It should be noted that as GLAP will be a party to the legal documentation, GLAP will also need to approve the disposal in accordance with its constitution.
6.4. The information in Part 2 is information the disclosure of which would be likely to prejudice the commercial interests of GLAP. It is therefore covered by Section 43(2) (commercial interests) of the Freedom of Information Act 2000. It contains information as to value and price which if disclosed would adversely affect GLAP’s ability to secure other disposals at market value.
7. Housing Investment Group
7.1. The disposal was endorsed by Housing Investment Group on 9 December 2015.
|
Activity |
Timeline |
|
Agree terms of sale contract |
November 2015 |
|
Exchange of contracts |
December 2015 |
|
Completion |
December 2015 /January 2016 |
3.1. The disposal has been subject to a Red Book Valuation which is required to meet the RICS mandatory rules and best practice guidance, which promotes high standards of transparency and accuracy in valuation.