The outgoing Conservative-run council in Croydon tried to sell-off the publicly owned old Ashburton Library building on the day before the local elections at the knock-down price of £84,000.
Independent valuations conducted for the council had suggested that the building’s true price ought to have been nearer £500,000. Labour’s new administration at Croydon Council has now blocked the sale going through.
“It’s just short of being a scandal,” one Katharine Street source told Inside Croydon today. “You couldn’t get a bed-sit in Croydon for £85,000 these days, yet the Tories were flogging this large important public building on the cheap.
“It looks like a desperate fire sale of public assets, done deliberately before the Tories lost control of the Town Hall. The councillors and the council officials responsible for pushing such a deal through should be called to account.”
The old Ashburton Library, sited within the local park, has been out of use since 2006 and through neglect by the council was allowed to fall into serious disrepair. The previous council administration suggested that repair and renovation to get the building back into use could cost £1 million.
Labour won control of Croydon Council in May in part because its candidates won all three seats in Ashburton ward for the first time. Labour had made a manifesto pledge to oppose the sale of public assets – including the old Ashburton Library, which many locals want to see brought back into community use.
The building was put out to offers last autumn, and three firm bids were received. It is not known what value was put on the property by the other, rejected bidders, but the one accepted by Croydon’s Tories was from His Grace Community Outreach Church, based in Thornton Heath. Not unreasonably, the church is outraged that what they thought was a done deal – finalised on May 21, the day before Croydon went to the polls – has been binned.
Pastor Bola Thomas, from the church, has claimed, “We paid a fair price for a building which has been abandoned for eight years.”
Neither the current or previous council administration, nor the church, had previously revealed that what Pastor Thomas called a “fair price” was as little as £84,000.
Undoubtedly, because the council had neglected the building for some time, they had to factor into the asking price the need for potential buyers to spend some money on bringing the building into a usable state. Pastor Thomas claimed her church was to spend £700,000 to do so.
“We have not just guesstimated those figures, we have had surveys carried out. This is very upsetting,” she said.
Timothy Godfrey, Labour’s culture spokesman, made the decision to halt the sale. He is known to be keen to support moves to have the building utilised for the broader Ashburton and Croydon community, rather than one single faith group, and according to a Croydon Council spokesman, “A covenant attached to the building means it can be used only for education-related purposes.”
- Secrecy surrounds council’s sale of old Ashburton Library
- Ashburton residents firmly oppose sale of old library
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Quote “The councillors and the council officials responsible for pushing such a deal through should be called to account.”. As a retired local government officer my comment is that councillors are politicians and can come up with all sorts of weird and wonderful ideas. Sometimes they make sense, sometimes they.don’t. That’s fine, that is what they are there for. The case of council “officials”, i.e. council officiers who are not and cannot be political, is different. Their job is always to check in the first place whether the politicians’ ideas are lawful and in the public interest and to advise the poiticians accordingly. In particular, it is not lawful to dispose of public asserts at a price well below their true value, i.e. in effect just to give a lot of council tax payers’ money away to some third party. The council has a statutory duty to manage its finances and assets responsibly. It is also for the same reason not lawful to allow public assets to become delapidated (through mismanagement or for other reasons) so that they lose value. It is the job of non-political council officiers to advise the elected councillers of all these things. If this was not done properly – and at this stage that is an open question for we don’t know the details yet – we need to dig out every scrap of paper relating to the building right back back to 2006 and up to its proposed sale (beginning with all the committee reports) to see what exactly has been going on inside the burocracy, and if it turns out to be a bit dodgy , we might need to check whether there were previous questionable disposals of council assets of this nature.. As a technical point, if an investigation were to reveal that the proposed sale at this very low price had been unlawful, the contract would have been “ultra vires”, i.e. nul and void and unenforcable, for a local authority cannot carry out transactions which are unlawful or for which it has no,legal powers. if you do business with a council the onus is on you to check that the council, acts lawfully, or your contract with it may be nul and void.
The building would make a great Beefeater Restaurant, returning a steady income to a cash-strapped local authority. Or if Tim and his comrades find that idea too commercial, maybe a free school. The important thing is to act quickly if the new council is not to suffer considerable flack from the Tories; I understand the local MP, Gavin Barwell, is already publicly attacking the decision to cancel the sale.
“Gavin Barwell, is already publicly attacking the decision to cancel the sale.” Shows you Gav really doesn’t have much political touch, does he?
I think the worse scandal is that such an attractive building with considerable potential was neglected and allowed to decline for so many years. It’s difficult to judge what a “fair” price would be without seeing the interior, but there were reports of considerable damage caused by fires.
Eight years, to be precise, Adrian, from 2006 until 2014…
And this despite a Tory 2010 manifesto promise to bring the building back into use.
This is a property of some architectural merit placed in the centre of a public park. The restricting covenants on its use have not been revealed.
It is being sold on the basis of a 125-year lease; what are conditions for resale? Does the purchaser have an obligation to commence renovation within a certain time or when they think it is right in their self interest?
Among all these questions i know one thing. For such an asset in a London location the price of £85,000 stinks to high heaven. I fear the fire starters with this attractive building.
What exactly happened on 21st May? If contracts were exchanged it’s hard to see how the Council can withdraw (without incurring penalties). If not, then nothing is binding and the matter wasn’t finalised.
As I stated above, the contract is not binding if the sale turns out to have been an act by the council which was unlawful or utra vires. In that case there simply is no contract – it never existed – and the purchaser has no comeback whatsoever. There is important case law on the subject.
I beg to disagree with you Tom. First, there’s no clear evidence at present that the proposed sale was at an undervalue. If it turns out it was, it’s extremely unusual for a transaction like this to be ruled ultra vires. Thirdly, even if it was ultra vires, the law protects a bone fide purchaser for value, so the buyer would almost certainly acquire good title.
So the previous Conservative council were prepared to sell a building, which has an estimated value of £500,000 for £85,000? This borders on fraud, potentially depriving the incoming council of hundreds of thousands of pounds, if the sale had been pushed through!
What on earth were the Conservatives thinking? Surely as a council they had a duty of care to get the best deal for the residents of Croydon? In national and local government the Tories relentlessly bang on about getting a getting a fair deal for the “hard working tax payer”. How then can they justify, this frankly ludicrous attempt to sell off a property for mere loose change? It doesn’t make sense on any level.
Predictably man of the people; Gavin Barwell M.P sees things totally differently. He says the decision is placing the “Former Ashburton Library’s future in turmoil due to Council bungling”. He protests about the decision which the Labour Council has taken, criticizing them for reneging on the “deal”. He goes on to say that the council has acted “frankly dishonorably”.
Barwell’s views are echoed, in a rather hysterical contribution, by Barwell lackey; Andrew Kellett. Kellett wails that “I will conclude that the atheist wing of Croydon Labour Party is in the ascendancy……” Okay – so it’s acceptable to effectively rip off Croydon taxpayers then is it? I suggest that it is the Tories who were acting thoroughly dishonorably.
Both conveniently fail to mention that their Tory colleagues were going to sell the site for peanuts. Nor do they mention that the building was closed and left to fall into a state of disrepair on the Conservatives watch. Talk about defend the indefensible.
The organisation His Grace Evangelical Outreach that is based in Thornton Heath, may well have very admirable aims for the site – no problems with that. But from what I can find out about the church, it appears to be a relatively small organisation. I’d really be surprised if it had the reputed £700,000 to spend on the renovations. Where would the money come from? Wealthy backers?, donations? Has it published a business plan for the site? Was there a public consultation?
Like Councillor Godfrey I’d be keen to support moves to have the building utilized for the broader Ashburton and Croydon community, rather than one single faith group. The park is near to where I live, it’s a pleasant open space and is widely used by all sections of the community. It’s clear that the building on the site needs proper investment to bring it back into use. However for the Tories to have sold it off for £85,000 would have been a scandal.
Sadly Gavin Barwell and his chums appear to have used the Evangelical Outreach Church for entirely political reasons and that is also shameful.
I have two observations to make regarding this sale;
First, it is rather odd to attempt to conclude a politically sensitive property sale the day before an election and that invites suspicion. The previous administration’s apparent secretiveness over a lot of things merely adds to that sense.
Second, while an independent valuer may place a higher value on a property, it is dependent upon that value being achievable. It is not unknown for local authorities to over-value their properties to enhance the book value of their portfolio. However once placed on the market the property tends to achieve its real value, which is often shockingly low. Ultimately property investor value property based on the income / profit they can generate from it.
If Ashburton Library site came with the adjacent recreation ground with planning permission for town houses, then it would be worth £500,000+. However as an odd building stuck to one side of a flat featureless park, that doesn’t offer opportunity to change the environment significantly it doesn’t seem to present such an inviting prospect.
Selling the building to a church may be the best option as it off-loads a liability on to a financially viable operator.
Anyone know if a FoI request would let us know how much the other two bidders offered?
Under our new “open and transparent” Labour council?
They’ll say – a whole month after the question is posed – that the matter is “commercially confidential”.
Yeah, a matter involving public property.
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Not for the first time Rod Davies offers food for thought.
I understand there are restrictive covenants on the use of the building; then there will be busy-body councillors who will say it shouldn’t be used for this or that; and finally there will be the religious lobby, who are always looking for something for nothing because they insist they are doing their god’s work.
All these things will serve to depress the market value of the property even further, and yet the rest of us expect the council to achieve best value from the sale.