URL: https://democracy.darlington.gov.uk/ieDecisionDetails.aspx?ID=2010

Decision Maker:

Outcome: Recommendations Approved

Is Key Decision?: No

Is Callable In?: Yes

Purpose:

Content: The Cabinet Member with the Economy Portfolio introduced the report (previously circulated) of the Executive Director of Economy and Public Protection and the Executive Director of Resources and Governance to approve the establishment of a Joint Venture Company which will provide the infrastructure build and sale of homes at Burtree Garden Village under the company named High Faverdale Park JV Limited (“the JVC”) and to seek approval for the sale of the land at Burtree Garden Village, (the Land) to the JVC.   The report recommended the establishment of a new Joint Venture Company between the Council and Esh Homes Limited to acquire the site and bring forward residential development on the Burtree Garden Village sites as shown edged red on the Location Plan. The purchase price for the site had been negotiated at arm’s length and in line with the terms and supporting Development Appraisal and Cashflows annexed.   The report outlined how planning permission had been obtained for the delivery of circa 130 houses on the site and there is an existing s106 agreement in place. Nutrient neutrality (NN) credits are required in order to develop the site. It was explained that the Joint Venture Company will be based on a 50:50 split between the Council and Esh Homes Limited and the Company will return developer profits to the Council and Esh Homes Limited.   Also explained was how the Joint Venture Company will be fully funded by the Council, and this will be via prudential borrowing of up to maximum of £8.382m (the initial payment from the Council will be £2,326,289), with a further drawdown subject to satisfactory progress on site. The loan will be repaid via the Joint Venture Company to the Council and will generate a net income to the Council after taking into account any cost of borrowing undertaken by the authority. The estimated pre-tax profit share for the Council is £0.662m.   RESOLVED - It is recommended that: -   (a)    Cabinet approve the establishment of the Joint Venture Company, High Faverdale Park JV Limited to acquire the site, deliver, build and sell new homes at Burtree Garden Village and agree to give delegated powers to the Assistant Director of Law and Governance to transfer the land and progress the sale on the terms reported in Part III of the report, Appendix 7. (b)   Cabinet approve £ 8.382m from the Investment Fund, to fund the Joint Venture Company financed by prudential borrowing, subject to a first Legal Charge in favour of the Council over the Land acquired by the Joint Venture Company, together with a Guarantee from the Joint Venture Partner in respect of 50% of the Loan sum. (c)    That the Joint Venture Agreement be approved and delegated authority to the Executive Director of Resources and Governance be granted to negotiate the final terms of the Joint Venture Agreement and finalise the establishment of the Joint Venture Company, in line with the terms and supporting Development Appraisal and Cashflows annexed at Appendix 2 (Part III) and Appendix 3 (Part III). (d)   Conditional upon completion of the Joint Venture agreement that a secured loan facility be entered into with the Joint Venture Company, as a secured loan simultaneous with the land acquisition. (e)   The Executive Director of Economy and Public Protection, Assistant Director of Resources and the Assistant Director of Housing and Revenues are appointed to act as directors in the Joint Venture Company as part of its Executive Board.   REASON - The recommendations are supported by the following reasons: -   (a)    To assist in the delivery of the Economic Strategy by speeding up the building of new homes (b)   To deliver income for the Council.  

Date of Decision: June 9, 2026