Sidmouth’s former district council HQ has cost a developer £9million.
Buyer PegasusLife could net ‘£50million’ from the 113-home retirement community it is poised to build at Knowle, however, the huge figure would not be pure profit.
East Devon District Council (EDDC) today revealed exactly how much it will receive for the site – with the public coffers swelling by £1.5million more than originally agreed.
The authority relocated to a purpose-built new base in Honiton and a refurbished Exmouth Town Hall earlier this year at a cost of more than £10million.
EDDC says the final stage of the sale of Knowle, when ownership of the site is transferred to PegasusLife, will take place on December 18.
A total sum of £9,019,605 will be paid to EDDC. The developer will fork out an extra £1,514,605 on top of the base sale price of £7,505,000.
Knowle has now been cleared of thousands of items of furniture, equipment and memorabilia – with historical artefacts such as fireplaces and decorative tiles gifted to Sidmouth Museum.
EDDC will continue with daily security patrols, building checks and maintenance of the grounds.
It says the additional funds it will recieve comprise of a sum due to inflation – known as ‘indexation’ – and a percentage of community infrastructure money the developer had set aside.
These amount to £1,095,855 and £418,750 respectively.
In a statement issued today, EDDC blasted recent ‘misinformed media speculation’ that the supposed value of the site was ‘£50million’.
“The council would like to reiterate that this figure is the projected total sale receipts of all the residences in a completed new development on the former office site,” said a spokesperson.
“This figure doesn’t take account of any of the costs of development such as planning, design, surveys, professional fees, borrowing costs and the actual construction costs themselves.
“The genuine market price valuation of the Sidmouth site was reached by independent property professionals in what is known as a ‘Red Book’ valuation, against a number of potential development scenarios.
“The offer from PegasusLife of £7,505,000 was well within the Red Book valuations and therefore represents a realistic and market tested price.”
EDDC’s new Blackdown House HQ in Honiton, which opened for business in February 11, cost the authority £8.7million.
An additional £1.5million was spent on upgrading Exmouth Town Hall, where a third of council staff are based.
The council’s deputy chief executive and relocation project lead Richard Cohen said: “In different ways this is a new era for the council and our move to modern offices is key to the council’s plans for cost-effective and outstanding service delivery into the future.
“It is a credit to our staff that the move itself was seamless and their commitment and professionalism is a strong as ever in their new and much improved work space.
“To our customers, our council offices are now more accessible and easy to reach and we continue to improve our services and the different ways that people can contact us face-to-face, on-line or over the phone.
“On top of this operational success, the council has secured an additional £1.5million or 20 per cent uplift on the original agreed price for our former HQ site and the council has been able to fund the relocation project from existing cash resources rather than incur any external borrowing.
“This is a very positive outcome compared to what was originally agreed and will further benefit our residents of the whole district.”
A government planning inspector granted PegasusLife permission for its 113-home retirement community at Knowle on appeal early last year.
EDDC’s development management committee had previously refused the plans – prompting a public inquiry in November 2017.