Issue - meetings

RESOLVED that 1) the negotiated and agreed heads of terms be approved,

2) that the Council enters in to a lease agreement with 2WL Limited.

Executive considered a detailed report which provided an update on the outcome of lease negotiations with 2WL Limited, based at Pleasley Vale Business Park, and also sought Members’ approval to enter into a new lease agreement with them on the negotiated terms as set out in the report.

2WL had an established business operation at Pleasley Vale having been based on the site for almost 30 years. 

On 6th September 2021, the Executive granted delegated authority to the Director -Strategy and Development to agree terms with 2WL Limited for a new lease.  These agreed heads of terms were set out in Appendix 1 to the report. 

The rent would continue at £93,303 for the first 5 years of the new term which would enable the tenant to make a capital investment in years 1 to 3.  The rent had been agreed by the Council’s Senior Valuer.

The capital investment included repairs to areas of the floor and the roof in the occupiable space in Mill 2 and the Dyehouse and replacement of windows to the front elevation of Mill 2, the elevation facing towards Mill One, and which was visible from entering the site from Mill One.

The Landlord would have the right to break the lease in the event of redevelopment of the site by the Landlord.  However, Members were asked to note this would only apply when a redevelopment contract had been signed and would be subject to 24 months’ notice being served under the 1954 Landlord and Tenant Act.

The Tenant had the option to end the lease agreement at the end of the fifth year of the term by serving no less than 6 months prior written notice.

An upwards only rent review would be completed every 5 years from commencement of the lease and in the last year of the term. This would be based on market value.

Moved by Councillor John Ritchie and seconded by Councillor Duncan McGregor

RESOLVED that 1) the negotiated and agreed heads of terms be approved,

2) a lease agreement be entered into with 2WL Limited.

Reasons for Recommendation

Securing a tenancy for 2WL Limited at Pleasley Vale Business Park would provide some certainty on their continued occupation of the site and enable them to make capital investment in the building. This would significantly improve the premises, which were currently in a poor state of repair, and ensure that the Landlord could invest its limited revenue funds into urgent repairs which had already been identified in other areas on site.

There were currently no confirmed proposals for the regeneration of Pleasley Vale Business Park and therefore agreeing the tenancy would secure the rental income of at least £93,303 per annum for the 15-year term. In addition, the business rate liability, currently £49,664 per annum, would remain with the tenant.

By including the Landlord break, it ensured that accepting these proposals would not compromise redevelopment of Pleasley Mills. 

Alternative Options and Reasons for Rejection

To allow the current lease to  ...  view the full minutes text for item 65