URL: https://democracy.croydon.gov.uk/ieDecisionDetails.aspx?ID=2691

Decision Maker: Corporate Director of Resources (Section 151)

Outcome: Recommendations Approved

Is Key Decision?: Yes

Is Callable In?: No

Purpose: This report will recommend the granting of a new 15-year Full Repairing and Insuring (FRI) lease (“the New Lease”) of the building known as Crystal Development Centre, Former Tollgate Centre, Malling Close, Addiscombe CR0 7YD (“the Property”) to Croydon Health Services NHS Trust (“the Trust”) in consideration of the Trust entering into a simultaneous deed of surrender (“the Deed of Surrender”) in respect of their existing lease of part of the Property dated 29th March 2018 (“the Existing Lease”). If left to run, the Existing Lease would not expire until 31st August 2026. The Council has permitted the Trust to take early occupation of the remaining part of the Property pursuant to a Tenancy at Will, pending completion of the New Lease, to allow the Trust to commence refurbishment works to the Property.   IMPORTANT: Special Urgency and Call-In Waiver will be requested to allow the taking of the decision early than the 31st March 2026 and immediate implementation of the decision.  

Content: This report will recommend the granting of a new 15-year Full Repairing and Insuring (FRI) lease (“the New Lease”) of the building known as Crystal Development Centre, Former Tollgate Centre, Malling Close, Addiscombe CR0 7YD (“the Property”) to Croydon Health Services NHS Trust (“the Trust”) in consideration of the Trust entering into a simultaneous deed of surrender (“the Deed of Surrender”) in respect of their existing lease of part of the Property dated 29th March 2018 (“the Existing Lease”). If left to run, the Existing Lease would not expire until 31st August 2026. The Council has permitted the Trust to take early occupation of the remaining part of the Property pursuant to a Tenancy at Will, pending completion of the New Lease, to allow the Trust to commence refurbishment works to the Property.   IMPORTANT: Special Urgency and Call-In Waiver will be requested to allow the taking of the decision early than the 31st March 2026 and immediate implementation of the decision.   For the reasons set out in this report and the Part B report, the Corporate Director of Resources and Section 151 Officer AGREED:   1.1         To approve the grant of the New Lease of the Property to the Trust in consideration of the Trust entering into the Deed of Surrender.   1.2         To approve the terms of the New Lease as set out within this report and the confidential Part B report, which contains commercially sensitive financial information relating to the transaction.   The Property, which formed part of Tranche 1 of disposals, received one offer below lease value; progressing with the Trust secures both best value outcomes and the continued provision of vital healthcare services to the community.   A market rent valuation has been undertaken by the Council’s appointed surveyor to determine the appropriate rental level for the Property. The rent agreed with the Trust is in line with this independent assessment and therefore represents the best consideration reasonably obtainable.    The New Lease will secure long-term rental income for the Council and reduce liabilities associated with maintaining the Property through the adoption of a full repairing and insuring lease structure.   The Trust is a key strategic partner to the Council, delivering essential healthcare services to the local community, and this approach reflects a balanced decision to support continued service provision while maintaining asset management flexibility.   The arrangement will enable the Trust to undertake significant capital refurbishments works to and improve the condition and operational suitability of the Property, at no cost to the Council, save for an initial 6 month rent free period at the start of the New Lease.   The New Lease will support continued delivery of healthcare services within the borough, contributing to wider Council priorities around community wellbeing and service provision.   The transaction supports the Council’s Asset Management Strategy and Medium-Term Financial Strategy through improved utilisation of Council assets and enhanced revenue generation.   A range of options were considered, including disposal, alternative occupational arrangements and continuation of the existing use.   The option of disposal remains available to the Council as a longer-term strategy; however, this decision relates specifically to the grant of a lease at this stage.   Option A: Premises are not let to the Trust - Not granting the lease would leave the premises without a secure long-term tenancy and would prevent the Trust from progressing its planned capital refurbishment works. These works funded entirely by the Trust, represent a significant investment that would otherwise fall to the Council. Choosing not to let the premises to the Trust would therefore forfeit substantial savings on capital expenditure and prolong the period during which the building remains under-invested and operationally constrained.   Option B: Seek alternative tenants: Given the Trust’s existing occupation and investment in healthcare services within the borough, seeking an alternative tenant would introduce operational risk and delay income generation.  

Date of Decision: March 27, 2026