VENUE CAMPAIGN
Email from NELGC to Mayor Jules Pipe, in response to
his letter below.
8th September 2009
Dear Jules Pipes
I would like to take this opportunity to respond to your email which was
forwarded to me by several Hackney residents today.
At no point during the tender process was I, or anyone from NELGC
provided with a copy of the Head of Terms. The only documentation prior
to tendering for the lease was an application form that I completed and
returned with our business proposal, which was provided well in advance
of the deadline date. The day before the interview I was informed by
Geraldine Glandon that I must have two guarantors, who were not
associated with the club or individuals who would sign the lease. I was
given 2 hours to provide this information the day before the selection
interview. I was informed that if I did not do this NELGC would be
withdrawn and I was refused any documentation to give to the guarantors.
I was verbally informed that the guarantors would be liable for 3 – 6
months rent. At this point I was also told about the six months
deposit, after I had already submitted the business plan. Although
requested, no written documentation of anything was provided at any
point prior to the selection interview. If you have been informed to the
contrary I would like to see the documentation.
2 weeks after the selection interview I was given a rough draft of the
Heads of Terms. I responded by email to the Heads of Terms and had a
number of points agreed by email. I was also informed further
information was to follow, this did not arrive.
As communication with Hackney Council was proving difficult and I had
not received clarification of some areas of the Heads of Terms I
requested a meeting with David Hawkes on the 20th August. At this
meeting I received a letter from Philip Glascoe, I assume this is the
same letter you had as it matches your response. I responded on the
21st highlighting the points which were incorrect in the letter. I
have not received a response to this communication.
On the 28th August I provided Hackney Council with a copy of the minutes
(which are also on our website) and a copy of the constitution.
On the 21st August I received a copy of the final Heads of Terms.
I am still waiting for some information on estate charges and surveyors
fees.
On the 26th August the NELGC committee met to discuss the Heads of
Terms.
To respond to other points you have made:
Business rates:
The council were advised that we intended to seek Charitable status and
as such would get 80% reduction in business rates with 20% discretionary
relief also possible, this is reflected in our cash flow and does not
need to be altered.
Surveyors and solicitors fees:
Our surveyor and solicitor fees have been accounted for in our cash
flow. The fees of £2800 to pay for Hackney Councils fees were not. I’m
advised that it is normal for each party to bear there own costs.
Hackney have now agreed to reduce these to £1,600. Perhaps you could
tell me why we have to pay these when Hackney has an in house team which
as hackney residents we are already paying for!
Foregoing 3 months rent advance:
I was informed that the council had changed its policy and was taking
rent monthly rather than 3 monthly. However they would still want the
initial 3 months rent in advance. They did agree to reduce the 6 month
deposit down to a more normal 3 months. So my understanding is that
they are still requesting 6 months monies in advance. Perhaps this needs
to be clarified.
NELGC has been working extremely hard to ensure that this process moves
as quickly and as smoothly as possible. However, we have been advised
that a request for:
3 months deposit
3 months rent
3 guarantors with unlimited liability is unreasonable and advised not to
sign anything until this is resolved.
NELGC agreed that our solicitor would act on our behalf directly with
Hackney Council regarding the Heads of Terms.
Given this I take exception to your response and would request that you
ensure your information is accurate before it is sent.
Kind Regards Lara
NELGC
Letter from Mayor Jules Pipe, 8th September
2009:
Re: North East London Gymnastics Club
Thank you for your email regarding the above matter, which was received
in my office on 18th August 2009. I am sorry to hear of the difficulties
being experienced by NELGC.
The Council’s Property Services department have advised me that they are
working hard with NELGC to ensure that they can occupy their new
premises as quickly as possible. The suggestion that the Council is
holding proceedings up is, I am assured, incorrect.
Regarding the preparation of a lease, the Council cannot instruct its
legal team to prepare the lease until NELGC has agreed to the Heads of
Terms. The property at 46 Milton Grove was marketed on a commercial
basis, and the majority of the Heads of Terms were made available to
applicants in advance. Despite this, I have been advised that since
NELGC was selected as the preferred bidder, it has repeatedly sought to
amend the Heads of Terms, and to date has still not indicated its
agreement. It is this lack of agreement on the part of NELGC, rather
than any inaction on the part of the Council, which is the cause of the
current delay.
The Council has, in fact, agreed to a number of NELGC’s requests,
including taking the unusual step of agreeing to forgo one quarter’s
advance rent, which had been a clear condition of the original offer. In
addition, the Council has forwarded a provisional draft of the lease
agreement to NELGC despite the fact that the Heads of Terms have still
not been signed. Neither of these actions would normally be offered to
prospective commercial tenants, and I believe that this demonstrates the
efforts the Council is taking to assist NELGC to move to these premises.
In addition, I understand that the Council had already brought to
NELGC’s attention the fact that the terms of their own constitution
prohibited them from trading. I have been advised that an extraordinary
general meeting has now occurred to amend the constitution, but that the
Council has still not received the copies of the minutes of this meeting
and of the new constitution from NELGC. The organisation must provide
these documents in order for a lease to be drawn up.
I understand that there are also a number of other points on which the
action of NELGC is required, including accounting for Business Rates
payments in their cash flow projections. In addition, statutory legal
and surveyance fees will be payable before a final lease can be drawn
up.
With respect to the need for guarantors for the rent, this has arisen as
a result of NELGC’s decision to change the name on the lease from the
owner of the business to the business itself. I understand that this was
in order to qualify for a Business Rates reduction, in line with the
appropriate legislation. The Council has a responsibility to protect its
interests and the public funds for which it is responsible, which means
that it has to ask for guarantors in a situation such as this.
With regard to 46 Milton Grove being occupied by squatters, it is not
the case that the Council has done nothing about this matter. The
Council has followed the necessary legal process to evict the squatters,
and now has a court date of 10th September 2009 for the eviction
hearing. There are a number of steps which the Council needed to take
before applying for a court order, and it would have jeopardised its
success had it not followed the due legal process. The court will, of
course, make the ultimate decision on this matter, but the Council will
be seeking immediate eviction and possession of the premises on this
date.
Nevertheless, the presence of the squatters is not currently the barrier
to NELGC occupying 46 Milton Grove. Even if the squatters were to be
evicted immediately, the situation cannot be moved forward until NELGC
takes the actions outlined above.
Whilst the Council will continue to offer its support to NELGC, I have
been advised that if NELGC is unwilling or unable to reach an agreement,
the Council does have the option of going back to other organisations
that made bids for the lease, or reopening the tendering process.
However, I do hope that this course of action will not be necessary, and
that NELGC will now take the necessary action to move this process
forward.
If you have any further queries, please do not hesitate to contact David
Hawkes, Senior Estates Surveyor, on 020 8356 2803.
Yours sincerely
Jules Pipe
Mayor of Hackney
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