Thursday, September 13, 2018

News: Council's Forge Island deal comes under scrutiny

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Muse Developments' bid to become Rotherham Council's preferred partner for Forge Island scored highly on deliverability, providing confidence that the town will get its first cinema for 30 years.

Having secured the land from Tesco, and surrounding land such as the law courts, the authority went out to the market earlier this year in an effort to realise its vision for a £60m leisure-led development on the key town centre site.

35 development packs were sent out to interested parties during stage one of the process and three bidders were asked to make detailed submissions. Muse, a national developer that is part of the Morgan Sindall Group plc, was one of two parties to submit a detailed bid and was named as the preferred partner last month.

The project was discussed at a recent meeting of Council's Overview and Scrutiny Management Board where members could ask questions of officers on what the deal means for the Council and the borough, although many details could not been discussed due to commercial sensitivities.

Paul Woodcock, assistant director for Planning, Regeneration and Transportation at Rotherham Council, told the meeting: "The basis of the successful bid from Muse was centred on a cinema operator. Linked to that, a number of food and drink units - the proposal had got four - that could or could not change depending on the market. The market is struggling but they [Muse] were pretty confident that they could land a number of food of drink units.

"And then there was a hotel as well, and there's a couple of options there in terms of the quality of hotel, again dependent on price, cost and attractiveness to the market."

A new bridge is proposed as is high quality public realm and car parking. Later phases are set to include residential development. One element missing is a new theatre and officers confirmed that plans for Forge Island do not currently include a theatre.

Woodcock added: "All we've done at the minute is select a development partner. We've now got to go through due process in terms of agreement to lease, potential head lease, and then ultimately things will come through to planning - the detail around the development will then be for all to see."

A draft timeline has the developers and council working towards a planning application being submitted early in 2019 after agreements over the lease are made. Work is set to begin later in 2019 with the first phase opening in 2020.

Cannon, the last town centre cinema, closed in 1990.

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In choosing Muse, Rotherham Council called on independent advice from industry experts at CinemaNext, legal firm, Pinsent Mason, masterplanners at WYG and property regeneration specialists, Thomas Lister.

Tim O'Connell, Head of RiDO, said: "There were two really strong bids, neither bid we felt disappointed with. Both had really strong elements of design and the elements that Muse scored strongest on were around deliverability, so we were sure that we were able to get this scheme to happen. We felt that was particularly important.

"And some of the pre-agreements around the legal context and the agreement that we will put in place with the developer worked quite well alongside the response that we had back from Muse."

Deliverability was a key focus for the Rotherham town centre masterplan that was revealed last year.

Officers were asked about risks on the project. Paul Woodcock explained: "A development of this size and nature will always have risk because you are at the mercy of the market. Councils don't tend to own and operate cinemas, food and drink establishments and hotels.

"We are working through with finance and legal and we've had external partners advising us. Our risk is around financial exposure, looking at minimising the risk to the Council financially but at the same time not killing the scheme off completely."

A recent study into the leisure sector in Sheffield and Rotherham carried out by experts at Bilfinger GVA showed that the ability to retain trips in the Rotherham area rather than film fans currently heading to Sheffield "will create a level of capacity which is able to support a new local cinema." It added that if a new cinema facility in Rotherham is able to retain 80% of cinema trips from within the borough, there will be a demand for up to 11 screens.

In addition, studies into the proposed new £300m Leisure Hall at Meadowhall showed that 51% of the food and beverage turnover at the current shopping centre comes from Rotherham residents.

A planning application has recently been submitted for hoardings around the Forge Island site and flood alleviation works are also planned.

Forge Island website

Images: Muse

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