151 BRIEF

    • 5 Dec, 2019

    Glasgow raises £195m in debt finance deal

    Glasgow City Council has completed a deal with pension insurer Pension Insurance Corporation (PIC), to help fund its equal pay settlement

    In January, the council abandoned its attempts to fend off a legal claim that it had not paid women employees equally and agreed to pay claimants £548m.

    The deal will see PIC invest £195m of debt finance in the council’s City Property Glasgow Arm, secured on five properties including the city’s Royal Concert Hall and Riverside Museum.

    The council struck a similar deal worth £285m with Legal & General earlier this year.

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    • 5 Dec, 2019

    Bexley housing company scales back housing target

    A housing company created by London Borough of Bexley has slashed the number of homes it is planning due to a difficulty in acquiring development sites.

    The original business plan for Bexleyco set a target of creating a pipeline of 2,500 homes over the next 10 years.

    However, a revised plan approved by the council’s cabinet now says it only expects to deliver 1,200 homes over the period.

    The new plan said: “A key challenge remains for the company to secure a viable pipeline of development sites as only one additional site has so far been identified.

    “Therefore, a more prudent approach to the pipeline has been taken, matching more closely the development rate from the initial five sites.”

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    • 5 Dec, 2019

    Redbridge approves lottery plans

    London Borough of Redbridge has joined the growing number of councils creating a local lottery to fund good causes.

    The borough’s cabinet last week approved the plans, which could raise a maximum of £100,000 for charities and other organisations in the first year.

    The council is set to appoint operator Gatherwell to run the scheme and will pay the firm 16.7% of proceeds as an administration fee.

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    • 5 Dec, 2019

    Halton imposes freeze on non-essential spending

    Halton Borough Council has imposed a moratorium on non-essential spending to help deal with a predicted overspend on this year’s budget of £6.1m.

    A report to the council’s executive said that the overspend is due to a delay in implementing some of the £9.3m of savings included in the budget.

    The children and families department is predicting an overspend of £4.5m against its net budget of £22.8m, the report said.

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    • 5 Dec, 2019

    FRC looks to increase control over auditors

    The Financial Reporting Council is strengthening its ability to regulate UK audit firms, according to the Financial Times.

    The paper reported this week that the FRC has appointed Jamie Symington, a partner at law firm Brown Rudnick and former director of investigations at the Financial Conduct Authority, as deputy executive counsel.

    The FRC was branded “toothless” by MPs during a parliamentary inquiry into the failure of Carillion, whose accounts were signed off by accounting firm KPMG.

    According to the FT, the FRC levied £32m of fines against UK accountants last year, almost three times more than in the previous year.

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  • Legal & General invests £100m in Sunderland regeneration project

    Investment manager Legal & General is pumping £100m into three office buildings in Sunderland.

    The funding will deliver three new commercial buildings including  a new city hall, on the former Vaux Brewery site in the city.

    Sunderland City Council chief executive Patrick Melia, said the investment represented a ‘serious vote of confidence’ in Sunderland.

    He said: “Make no mistake, today’s announcement is the single most significant investment story to come out of Sunderland for decades.”

    A mixed use masterplan for the wider Vaux Brewery site was given planning permission in 2016.

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  • Somerset council invests in Devon industrial site

    South Somerset District Council (SSDC) has spent £4.2m on an industrial site in Exeter, Devon.

    The Centurion Mill site comprises two industrial buildings totalling on the Sowton Industrial Estate, between the M5 and Exeter’s city centre.

    The investment will deliver a net initial yield of 7 per cent, the council said.

    In a statement, it added: “SSDC is investing in a diverse range of locations and asset types to ensure that it spreads any risks attached to investments which reflects sound investment practice.

    “This includes assessing whether an investment outside the district will deliver a better rate of return for our communities than a similar opportunity in South Somerset.”

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  • Appeal Court backs Birmingham’s £19m sprinkler spending

    Birmingham City Council has won an Appeal Court challenge to its decision to add £19m to its capital budget to retro-fit sprinklers in its housing blocks.

    Resident Robin Clarke appealed against an earlier High Court decision that the council had acted within its powers to make the spending.

    Clarke’s appeal rested on whether the cabinet had failed to take all relevant factors into consideration or give good reasons for its decision to spend the money.

    This week’s appeal judgement said: “The Cabinet decided not to embark on the more detailed analysis that had been suggested, because it considered that the reasons for proceeding without further delay…outweighed the potential advantages of further investigation.

    “Mr Clarke does not agree with that decision. No doubt there might be others who would take the same view.

    “But it was in my judgment a decision properly taken by the Cabinet in respect of which no legal error has been identified and the challenge to it must be dismissed.”

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  • Border to Coast launches private credit offering

    LGPS pool Border to Coast has launched a private credit offering and announced its initial private equity and Infrastructure investments.

    In May, the pool secured £500m of commitments from eight partner funds for its first private equity offering.

    So far, it has invested $40m in the GreatPoint Innovation Fund II, £40m in the Palatine Private Equity Fund IV and $60m in theBaring Asia Private Equity Fund VII.

    Border to Coast chief investment officer Daniel Booth said: “We are very pleased with the level of engagement from industry participants following the launch of our private markets offerings and the openness and transparency of managers on which we have conducted due diligence.”

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  • Darlington estimates 17% annual return on proposed housing company

    Darlington Borough Council is set to approve plans to create a joint venture company to build new homes in the North East.

    A report to the council’s cabinet next week said the company would split profits 50/50 between itself and housebuilder Esh Homes.

    The council will contribute funding through prudential borrowing of up to £9.5m at its peak, the report said.

    It added: Overall it is estimated the scheme will deliver an average 17% annual return on Capital with pre-tax profits averaging over £1m per annum.”

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