To seek approval to proceed to conclude negotiations and enter into the Edgar Street Grid (ESG) Retail Quarter Development Agreement between Herefordshire Council, ESG Herefordshire Ltd, and Stanhope following an initial European procurement process and subsequent detailed financial and programming negotiations. 

THAT:

(a)     the substantive terms of the Development Agreement so far negotiated as described in this report be approved; and

(b)     approval be given for negotiations to be finalised on the basis of those substantive terms and for the finalised Development Agreement to be signed under the authority of the Director of Regeneration.

The Retail Quarter is one of the principal elements of the Edgar Street Grid (ESG) redevelopment.  Signature of the Development Agreement will tie both parties into the development process and give greater certainty that this mixed-use scheme will progress within a structured timeframe.  The signature of the Development Agreement represents the conclusion of an open market process that started with a developer selection procedure that recommended Stanhope as the preferred developer. 

The ESG Herefordshire Ltd (ESG) Board and Advantage West Midlands (AWM) have been involved in the selection process alongside senior Herefordshire Council Officers.  This report summarises the terms of the Development Agreement and the financial implications for the Council.

1                    To not sign, or to delay the signing of, the Development Agreement with Stanhope.

2                    Not signing the Development Agreement has direct implications for the rest of the ESG development in terms of delivery and financing.  In the current economic climate, government agencies and private developers require confidence that redevelopment schemes are progressing to programme.  Non signature of the Development Agreement may cause both Stanhope and AWM to review their investment in the Retail Quarter, and, should this be delayed, the whole of the ESG scheme including the essential investment in local infrastructure.

3                    Additionally either alternative option would have implications for the role and integrity of the ESG Herefordshire Ltd Board and Company.  A decision not to progress the proposal would result both in damage to the reputation of the authority and loss of significant resources to support the regeneration of the city.

Not applicable.