Thursday, 13 June 2013

KEEGAN "DEMANDS" £5 MILLION?

SFP Ventures (UK) Ltd trying to “extract” £5M from Thanet ratepayers?
TDC have said for some time that if they try to reclaim the site it would cost them upwards of £5M to extract themselves from their contract with SFP Ventures (UK) LTD, the Pleasurama developers.
Ratepayers of Thanet want answers to the following questions:
TDC can you explain how pulling out would cost us £5M?
Can the ratepayers see the breakdown of how you arrive at this figure?
Who told you it would cost £5M?
Have you sought proper legal advice?
The only expenditure I can find is the following:
£1m is a deposit

Item
Narrative
Cost
Evidence
Lease
3X 199 years
£550000
Dr Sue McGonigal
Deposit
Refundable to SFP
£1000000
Dr Sue McGonigal
Cliff repairs
Contribution
£100000
TDC & Painter
Roadworks and Storm drain
KCC Highways
£600000
Painter to BBC

Planning application
FRC Frewster
£22000
TDC
Total

£2272000

17 comments:

Anonymous said...

I wonder how much the legal fees would be trying to compulsorily purchase 3 199 year leaes?

I wonder how much groundworks and foundations cost, you know that they are often the most expensive single part of many projects...

Has Keegan ever demanded £5m or is your headline just a little sensationalist..

Lyndon T Palmer said...

It is more complicated than that Anon. You assume the foundation work:

(a) Complies with Planning consent

(b) Is fit for purpose.

Barry James said...

And anon (c) paid by Keegan. without a contract with TDC, Cardy will not get a penny out of TDC.

Barry James said...

Anon thanks for joining the debate. In the absence of Shaun Keegan ever engaging with the people of Ramsgate we are left with TDC saying "The developer has invested around £5M in pleasurama" also Terry Painter has said similar. TDC has said the £1m is a "deposit" however it was asked for more as a surety and cannot be treated as an investment.

Anonymous said...

The £5 million is based on the assumption that SFP would sue and the assumption that SFP would win their case and be able to claim costs from TDC. In essence it's an admission that TDC has failed in its duties to control development. Yet nobody is to blame...

Anonymous said...

Lyndon,

(a) there is no reason to suppose otherwise

(b) if they comply with the plans, and conform as in (a) there is no reason to suppose otherwise

(c) If I am correct in the detail so far, the leases are owned - through whichever company - by Shaun Keegan.

It would then seem to be Keegan that would be resisting any compulsory purchase. I would think therefore that who actually did the work of producing the foundations and groundworks in accordance with the planning consent in place, is immaterial, the jermain point would be that the leaseholder has completed the works and that work has a monetary cost/value, for which no doubt Keegan would seek re-imbursment in any attempt to seek a compulsory purchase.

Barry James said...

anon I'm afraid you are incorrect. Cardy offered SFP £1.5m towards the building project. The foundations have been put in as part of this contribution not as builders being paid by SFP therefore it is at their risk. as they don't have a contract with TDC they would have to take a joint action with SFP against TDC and I have it on good authority they would lose as it was done at their on risk without a written contract.

Anonymous said...

I would have to disagree with you Barry, you are incorrect.

Even assuming that the foundations constituted part of the proposed £1.5M "contribution, and that is far from clear, as Cardy's were part of the project alongside SFP, they will be in a strong position to claim back monies spent on a project with planning permission should TDC attempt to compulsorily purchase the leases that they sold.

Barry James said...

So in this case you are saying that currently £2.2 M has been identified, deduct the surety, which isn't an investment the developers and Cardy have spent £3.8 M on the foundations?

Anonymous said...

Not having access to the blueprints or specs for the foundations, I wouldn't like to estimate their cost, suffice to say that foundations/groundworks of major developments can and often do form upto 25% of the total cost of the build.

Given the amount of wwork that would seem to have been completed along with drainage, I would think that the £600k figure is a little suspect, where was that figure obtained?

You cannot dismiss the £1 million "deposit" as you seek to do, as presumably TDC would attempt to withold that deposit in any compulsory purchase action, or what would be the point of holding the deposit? That would make that £1 million subject to claim from SFP in the inevitable counter action.

As for the rest of the cost, I think that £2.8 million in legal costs is certainly not an unreasonable figure given TDC's ill judged legal foray's of recent years.

I think the figure of £5 million in any attempt to compulsorily purchase the leases already sold is not out of scale given the legal issues to be faced. If one includes the indirect costs, the capital lost from the ultimate sale of the freehold in years to come, loss of council tax, cost to TDC of doing something else with the site if no alterantive developer can be found etc, the cost to TDC could easily exceed £10 million, maybe a LOT higher.

Barry James said...

The figure of £600K was from Painter to the BBC. Foundations have been ignored for the reasons given and legal work ignore because the developer said "we have invested £5m so far into the development. A figure TDC Cllrs spout as a reason to carry on talking to a developer who hasn't developed in 10 years

Anonymous said...

Sorry Barry, but I believe your - calculations - are flawed for the reasons given, especially in relation to the cost and charging of the foundations.

The questions you ask in your original post don't question how much has been invested, merely - TDC can you explain how pulling out would cost us £5M? - no question of how much has been invested.

However i think it's fair to say I have shown that £5 million is certainly not a high figure, and given TDC's ill judged legal adventures to date, could be a conservative estimate.

Barry James said...

As I said these aren't TDC's figures but have come from the developer via Painter. They have been reiterated by TDC Councillors. I doubt the developer is adding on legal fees at the moment. It would help your argument if you would get a blogging account and also give some idea of your expertise to the wider audience.

Anonymous said...

I am not commenting on the statements of the developers Barry, simply on the questions you posed in you OP, namely - TDC can you explain how pulling out would cost us £5M? - that would seem to be questioning TDC's position, and thus the figures TDC quote, there seems to be no question or enquiry of how much has been invested.

How much has been invested is a different subject than how much it would cost TDC to recover the leases that have been sold or cancel the development contract.

My background is really not that important as the points I make are not really a matter of opinion, they stand on their own merit.

Barry James said...

Q1 and Q3 say How does TDC arrive at that figure of £5M and who told you. Do you think then I should have asked the question in the other order? Would that make it clearer to you anon

Readit said...

The planning fee did not originate from PRC Fewster architects. The £22,000 cheque was paid by Robert Leonard Services Ltd, (photocopy of cheque on file at TDC), they were the original applicant which was later stated to be an error by the architects (expensive error).

The planning application was submitted in Nov 2003 but SFP Ventures (UK) Ltd was not incorporated as a UK company until 2006. The planning permission was granted in the name of SFP Ventures Partners Ltd a ficticious UK company at that time.

Anonymous said...

private investigator...all ficticious documents, all cock and bull and we fight the council for fraud and corruption that is not fictious. Out with TDC and officers and no more fraud and lies. Land banking is fraud TDC and mr painter and other parties so your days are numbered. Made up by whom TDC and Painter.