Back in July last year, it made this perfectly clear - although the notion of 'commercially sensitive' information 18 months on is still not clear and many of the 'decisions' made back then have changed somewhat.
Stakeholder Engagement Event 26 July 2013
Which of Honiton or Cranbrook is more central to
people coming to visit the offices?
We shouldn’t get too focused on the geographic
location of any new office because a) it isn’t decided yet and b) many
customers deal with us online or by phone and many of our staff are already
available across the district such as benefits, planning and Streetscene staff.
However, we do need to keep in mind that the large bulk of the population of
the district are in the Western half.
What about air conditioning for a new building,
it’s not been mentioned but would surely add to costs?
There are no plans to have traditional air
conditioning as the office would be cooled through natural ventilation. This is
part of our aim to have a BREEAM Excellent rating for the new office.
Costs appear to be the driver for this project. How
confident are you that the 20% contingency you have put aside will be enough to
manage any overruns?
As we have made clear, keeping costs down for the
District is a priority for the Council and office relocation is a part of that.
We have taken professional advice and have visited other public sector and
private organisations who’ve undertaken such moves to gain from their
experience and they have all said that contingency is a normal and sensible
practice. If you do the proper management and preparation upfront then you
manage costs better in the long run. This means for instance being clear about
your design, commitment to it and don’t keep changing it. We feel confident
that if properly planned and managed the contingency should be more than
adequate.
Did you consider the refurbishment of the more
recent office block of the Knowle offices and demolition of the Victorian
element for housing?
Yes, we did fully consider that option. The space
available in the office extension blocks built in the 1970s and 1980s is
insufficient to house all the staff, the mixed site approach is unlikely to be
attractive to a developer and even these so called modern offices would require
considerable sums to bring them up to scratch. Financially it doesn’t work.
In your office accommodation cost calculations did
you include rental, interest and borrowing costs?
Yes. Purchase, rental and borrowing costs are all
factored in.
Are these costs publicly available?
Not yet as they include commercially sensitive
information. However we would like to publish at a time when the information is
no longer sensitive. Just as we have done for the sale of Elizabeth Hall: once
the figures were no longer deemed commercially sensitive we published them.
You identified a figure of £4.5 million figure is
that the economic impact on Sidmouth?
No, that figure is not the economic impact on
Sidmouth. We are estimating that there will be a £4.8million saving on annual
running costs by moving to a new purpose built office of the appropriate size
over a 20 year period, as compared to staying at the Knowle.
What is the estimated Capital Cost of a new build
office?
It is not possible to be exact and any figures
should be treated with caution. However, as a ball park figure something in the
region of £6 - 8 million is not unreasonable, depending whether it is
constructed to a BREEAM Very Good or Excellent Standard.
You have used a 20 year figure in your finance
model but many Council’s use 45 years for payback for Council house buildings
for example. Using that model the savings you will accrue are actually far
higher than you have stated. In addition have you factored in the rising price
of energy which again makes your cost savings probably an under-statement?
We have worked on a prudent cost model based on the
period of time of a new office from new build to first refurbishment.
Why have you boxed yourself into the £4.8 million
in terms of what a new office can add to the organisation. There are a whole
range of other benefits such as improved service delivery, new employment
opportunities, and greater productivity. You shouldn’t underestimate these
benefits.
Yes, you are quite right, there is a mix of
non-financial benefits which we are considering and aim to achieve through new
office accommodation.
If you chose the Cranbrook site for instance you
would be providing a huge economic boost to the new town and providing
additional employment for its 3,000 residents. This would help attract a range
of other businesses which would then in turn produce more business rates and
make your financial model even stronger.
Again, this is correct with regard to additional
benefits but we have deliberately taken a conservative view on the financing.
Has the Council decided which stakeholders and
issues have more weight, for instance what is the business driver for this
decision saving money for taxpayers, better working conditions for staff or the
wider economic benefit such as providing real help to small businesses?
We have tried to keep all our stakeholders in mind
and we see this as a district wide issue. We would support further
understanding of the economic impact on the location that we choose.
Please can you clarify the financial points as I
can’t see how you get to the payback model? How is it cost effective to spend
£6-8 million to save £189,000 a year?
We estimate £6 -8 million for a new build. We would
have to pay £1.56 million just to do essential repairs to Knowle such as
stopping the roof leaking. Bringing all the existing offices up to modern day
standards would be in the region of £15 million and even part of the buildings
would be many million. The capital receipt we would receive for part of the
site would not even start to cover this.
East Devon District Council - Moving and Improving - Stakeholder Questions
EDDC revives plans to leave Sidmouth - News - Devon 24
Back in February this year, it made several things clear - including the £15 million price tag for refurbishment:
www.eastdevon.gov.uk/east_devon_extra_office_relocation_feb14.pdf
However, the District Council has been unable to provide much detail as to how the '£15 million' figure was arrived at:
From: Robin Fuller
Sent: Thursday, August 29, 2013 3:52 PM
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Subject: £2million-£4.6million to refurbish modern Knowle - Davis Langdon figures
East Devon District Councillors
Sidmouth Town Councillors
Four weeks ago I sent EDDC an assessment showing that they have 2,725 sqm of floorspace in modern, 30-35 year old offices at Knowle, 40% more than they claimed. That floorspace is nearly as much as EDDC intends in a new building. I argued that sale of the redundant older parts of Knowle would pay the costs of refurbishing the newer parts instead. However, EDDC loaded the estimated costs of refurbishing Knowle – £15million they said – by pricing refurbishment of the entire Knowle which has more than double the floorspace they will actually need (see ‘Knowle HQ move can’t be justified’, Sidmouth Herald, 16 August 2013).
EDDC have not replied to defend their figures; only to say that sale of the old Knowle would not cover the costs of upgrading and refurbishing the newer buildings. Since EDDC have seemingly failed to estimate the cost of refurbishing the modern offices, I have done so using data published by Davis Langdon, EDDC’s own consultants on ‘moving and improving’. They assess typical benefits and costs of office refurbishment: (http://www.davislangdon.com/upload/30297_Cost%20Model%20-%20Office%20Refurb_v2.pdf).
They state that benefits include: a better balance of risk and return; delivery 15‑70% quicker than new build; costs 10‑75% less than a new build; an opportunity to support new ways of working; a reduction in the carbon footprint; reduction of the overall environmental impact when compared to a new build.
Davis Langdon estimated costs to ‘remodel, medium refurbishment’ as £807-£1345 per sqm or to ‘renew, major refurbishment’ as £1345-£1883 per sqm (Central London prices, 2012; south-west prices 89% of this). These costs are for a Category A fit-out – generally what a developer provides as rentable office space.
Using Davis Langdon’s figures, the refurbishment costs for the 2,725 sqm of modern offices at Knowle would be £2.0million-£3.3million to ‘remodel’ or £3.3million-£4.6million to ‘renew’ (at SW prices).
It is obvious that refurbishment of just those parts of Knowle needed by EDDC – mostly buildings 30‑35 years old – cannot possibly cost as much as the £15million quoted for all Knowle buildings, some over 200 years old. The likely costs, in the range £2.0million-£4.6million according to Davis Langdon, need to be properly focussed by pricing a downsized Knowle, using a sensible design brief – not one contrived to match EDDC’s prejudice in favour of moving. I still expect that costs could be met by the sale of unused parts of Knowle for redevelopment as flats.
Effective refurbishment could make the energy efficiency of the modern buildings at Knowle as good as new, and bring the standard of accommodation fully up to date. However, EDDC still wants to build a brand new headquarters costing £6.9million-£7.9million (excluding the price of the land). Building costs are double, perhaps triple, the likely costs of refurbishment.
It is our money which EDDC puts at risk. We already own the Knowle. The potential loss of that amenity without a tangible gain to the people is not ‘cost-neutral’ as EDDC claim. We accept that EDDC’s offices need updating. However, we are entitled to a fair assessment of the real options and the true costs of refurbishment at Knowle, before EDDC can consider using our assets and our money to buy themselves a new building.
Robin Fuller
Sidmouth
Robin Fuller
Sidmouth
Futures Forum: Knowle: refurbishment vs redevelopment
EDDC Relocation..reality check?
I was told by Cllr Twiss that there was insufficient space for that. I then measured the newer buildings from plans provided by EDDC. I showed that there is 40% more modern floorspace than EDDC had claimed, and an area adequate for their needs – EDDC have never given us any factual counter-evidence.
I later found a publication by EDDC’s own consultants indicating that, typically, full refurbishment of the modern Knowle plus the council chamber should cost £2.0million-£3.3million to ‘remodel’ or £3.3million-£4.6million to gut and ‘renew’, not the £15million claimed by EDDC (the lower figures are still unchallenged by real, publicly released, EDDC data).
The only contribution I got to this debate from Council Leader Diviani was a two-word email (16 August 2013, copied to all Councillors): ‘Fuller’s Folly’.
EDDC Relocation..reality check? | Save Our Sidmouth
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