Monday, 19 November 2012

Muddy Waters at the Waterfront

Work to change the Esplanade quarter into the Jersey International Finance Centre could start next year. Lee Henry, from the Jersey Development Company, said it would take a decade to transform the 520 space car park into a finance hub. The States-owned firm wants six office blocks with underground car parking and public pathways between the buildings. Mr Henry said drivers would be able to park on the land next to the Radisson when the work starts. Three years ago plans were made to remove the Esplanade car park and replace it with offices, flats, bars and shops. (1)

There are a number of questions unanswered by this which I am sure will emerge in the fullness of time:

a) Initially the new plans were said to be temporarily shelving the sunken road idea. Is that still on the table for some future expansion or are these plans making that redundant? Remember the sunken road came with a price tag in 2009  of 1/2 million pounds a year in maintenance, which has probably risen in the meantime, and really is not something one wants anytime, let alone in times of austerity. Can we finally breathe a sigh of relief, or is there something nasty lurking in the wings, waiting to spring out? Some certainly here would be good; waffle and vagueness would not.

b) Is there going to be any revenue at all coming back to the States from this development? Previously, WEB (the predecessor to JDC) developed different parts of the Waterfront at no cost to the taxpayer, but with no yield to the taxpayer either. They were ceded land at nominal value, and their income disappeared in consultants, managing directors fees, legal fees, wages, and all manner of general overheads. No revenue stream went back to the States.

In fact, the States were worse off, because they were funding the rental of the Liberation Bus Station, which had its rent increased by WEB, and so the States were paying WEB for use of their own land (in a round about way). As Kevin Lewis, Minister for TTS noted in a reply to Gerard Baudains:

I can confirm that Liberation Station is leased from the Waterfront Enterprise Board (WEB) by the Public through Property Holdings, and can respond to the Senator's specific points as follows:
(a) The current lease commenced on 30th September 2007 and is for a period of 9 years, terminating 29th
September 2016.
(b) The 2010 rental liability is £100,000.
(c) The lease agreement provides for a 3 year rent review cycle

Isn't it wonderful! The States pay £100,000 for the privilege of leasing their own land, which amazingly was not quite enough to be consumed by the gargantuan salary of Stephen Izzat (MD for Waterfront at that time)! And I assume this leasing arrangement was simply taken over when WEB became JDC.

So is there any proposed revenue that will come back to the States from this new development? Or just more money leaching out? That's something which I think we ought to know. Preferably with some dates and figures rather than more vague promotional sounds of the kind that Alan Maclean is good at spouting.

c) What's happening with Harcourt? In March 2012 they were suing the States for millions over aborted plans. It's gone very quiet on that. Have they dropped their claim? Are matters progressing to an out of court settlement? All we have on record so far is a judgement on 15 October 2012, which relates to claims made against the Treasury Minister, Philip Ozouf, which has been adjourned for a month:

This is an application by the second defendant ("the Minister") to strike out the Order of Justice in so far as it contains claims against him.  The application is brought under RCR 6/13(1)(a), (b) and (d) and the inherent jurisdiction of the Court on the grounds that the Order of Justice discloses no cause of action, is scandalous, frivolous or is otherwise an abuse of the process of the Court. (3)

Any news? The media seem very quiet on this one, but some Court case must be still on the agenda. Perhaps some member of the States might raise the matter?

And finally, I was pleased that Lee Henry mentioned not going ahead until enough leases had been pre-signed up for the development. At least we won't get empty office blocks, and it seems that we can give one cheer for common sense.


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