Decision details

Wilson Street car park is a council owned property which is let to Pediment Investments Ltd who are a small private property company. The property was let for a term of 125 years from 4.11.1983 (84 years unexpired) at an initial rent of £2,300pa. The rent is subject to five yearly review and at the last completed review in 2018 the rent was increased from £4,300pa to at £5,887 pa. The site area is 0.1 acre and the site is used as car parking for the adjacent residential block which is owned freehold by Pediment Investments Ltd .
A sale is recommended for the following reasons:
- The wording of the rent review clause limits the scope for future significant rental growth over the next 84 years.
- The price includes an overbid to reflect the fact that the tenant is a special purchaser as they are both the tenant and the adjoining owner. A special purchaser is a particular buyer for whom a particular asset has a special value because of advantages arising from its ownership that would not be available to other buyers in a market.
- The price also reflects the potential development value of the land in conjunction with the tenants’ adjoining property.
- The Council has responsibility for repair of a rear boundary wall and this future cost and liability would be removed by the sale of the land.
- The land could not be used by the Council for any alternative use for the next 84 years, due to the existing lease to Pediment.

The council’s freehold property (Wilson Street car park) is sold to Pediment Investments Ltd for £250,000.

Option 1 - Properties such as this within the Investment Estate have increasingly been considered suitable for sale as the councils’ need for capital receipts has increased.
Option 2 - The property cannot be considered for operational use or for use by the councils’ partners because it is let on a long-term lease to Pediment Investments.
Option 3 - Negotiations were undertaken by the councils’ external agent - Hartnell Taylor Cook - who have recommended the offer for acceptance on the basis that it reflects a bid that is higher than normal market value because Pediment are a special purchaser.