Gagged

It seems our local Green Councillor has been gagged by TDC. Story here in the IOTG. It beggars belief that TDC could get into such a pickle over some legal advice. The perception, of course, is they have something to hide.

So let us examine what that legal advice may be.

Firstly the background to this is Cardy have approached TDC officers to solve the ongoing saga over SFP Ventures (UK) Ltd as TDC had served a breach notice on the Company due to inaction on their part.

As part of the process of allowing Cardy to take over SFP the Council have requested 3 pieces of information from experts. Firstly a formal valuation of the site by Strutt & Parker. Secondly a full structural survey of the cliff face, and thirdly legal advice from Pinsent Mason (PM). This last it seems is what Ian Driver removed from the Council office and is subject to a Legal Injuction to stop him disseminating the contents.

The valuation, also subject to the injunction,  is hardly rocket science as any competent accountant or estate agent could easily work this out based on the 2005 valuation which, since the then council legal officer announced as no longer on "pink", is in the public domain.

So lets examine just why Ian Driver has been gagged.

The Council Legal Officer, Harvey Patterson, announced at an Overview & Scrutiny T&F group meeting that due to the passage of time all paperwork prior to the 2009 Development Agreement should no more be kept secret so that means the suppressed Legal Advice cannot be anything to do with that. Neither is the prior advice concerning the serving of the breach notice as that seems to have been released into the public domain despite still being on "pink".

So what could this new advice be and just why is it so controversial? Firstly lets see just what the legal advisers were asked to do. To get to a point where PM can give advice they have to test why TDC are in this current predicament, this would indicate they have questioned the officers and examined paperwork to see how the current situation arose. They then would have used that 20/20 hindsight knowledge to formulate their advice.

So discounting their current advice to Council as that may have some confidential aspects however it is widely known that Cardy will be "allowed" to be the Developer once they purchase SFP Ventures (UK) Ltd so it isn't a huge secret and they are "the only game in town" it then becomes apparent that the information given to Pinsent Mason by officers may potentially be "Politically sensitive" or as is more likely highly sensitive to Officers on 2 counts.
Firstly to get to a position where appropriate advice can be given officers may have had to be completely honest to the lawyer and if they had known that information would be leaked they would have been less than forthcoming if they meant they would be perceived as inept.
Secondly it may be that the story being spun would be somewhat scuppered if the real truth was able to be read by the general public hence politically sensitive.
People already have a perception of how incompetently TDC operate however that would be far worse if the real truth came out.

 As an example of what transpired in 2012 FORS discovered that the freehold of the site was being requested by Shaun Keegan and we petitioned to stop it being handed over by TDC until at least the hotel was completed to "Shell & Core" however papers given to me show that the Freehold was going to be handed over for the surrender of the 3 leases (cost £550K) plus a payment of overage £3M plus a payment of £30 (to cover the legal cost of dissolving the leases) making a total of just under £3.6M not far short of the leaked site valuation. This "sale" of the freehold was kept from the public as we were led to believe the leases were important to Keegan on top of the freehold.

Further we are being told that Cardy approached Officers with a deal however what is clear from the leaked "Golden Balls" email it was in fact TDC who made the 1st approach to Cardy in August 2013 and not as we are led to believe Keegan's legal adviser who bought it up in their mediation meeting after the breach notice was served in July 2014. Also the Task & Finish group were aware of this in April 2014.

It is entirely possible that there are other reasons why this legal "advice" is being suppressed however what TDC politicos need to understand is the Public perception of TDC is at an all time low and people have very long memories. Its like the X-Files "the truth is out there".

Cabinet Decisions

16th October 2014 

Cabinet met in open session to discuss approving the officers in finalising a new development agreement with a reputable local builder Cardy Construction Ltd

10.1 It is recommended that Cabinet authorise the project team (in consultation with the S151 Monitoring Officer, Head of Paid Service and Cabinet Member for Finance and Estates) to progress with negotiations involving variations to the existing agreement (or a new agreement as provided for within the existing contract) in respect of Royal Sands. These negotiations will be undertaken in accordance with existing delegations and within the parameters detailed in paragraphs 3 through to 7 provided best consideration is achieved.
10.2 It is recommended that if further information becomes available during these negotiations that would result in there being a significant negative effect on the consideration owed, particularly as a result of the cliff wall surveys, then the matter should be brought back to Cabinet for further strategic review.

Part 1 video here

Part 2 video here

Once you remove the histrionics and the political utterances what is left is mainly centered around whether the £3.79M for the freehold is sufficient and whether TDC's duty of care around any future purchasers of the leases for either the hotel, apartments or commercial shops.

Any "Best Consideration"  must include things other than just cash

"The terms of the Consent mean that specific consent is not required for the disposal of any interest in land which the authority considers will help it to secure the promotion or improvement of the economic, social or environmental well-being of its area. Where applicable, authorities should also have regard to their community strategy. Although these criteria derive from the Local Government Act 2000, their use in the Consent is not confined to authorities with duties and powers under that Act. Therefore, authorities not covered by the 2000 Act can also rely upon the well-being criteria when considering disposals at less than best consideration. It will be for the authority to decide whether these decisions taken comply with any other relevant governing legislation. In all cases, disposal at less than best consideration is subject to the condition that the undervalue does not exceed £2,000,000 (two million pounds)."

Cliff Face

7.1 The area of cliff wall adjacent to the site is approximately 4 meters from the developed out property boundary. The cliff wall forms part of common land and the council recognises its duty to ensure that all reasonably foreseeable steps are taken to ensure it is adequately maintained.

7.2 The council undertakes regular inspections of the cliff wall to monitor the cliff face for movement and repairs. The council will ensure that new detailed surveys are undertaken in the area of cliff wall and all the reasonable concerns that have been raised will be investigated with the outcome published.

7.3 Part of any contractual modifications will require careful consideration in respect of any works required to the cliff wall. Cardy have agreed to make a capital contribution and are also mindful that in order to sell the units they will need to provide evidence to any buyer and their insurers that the cliff wall is safe and there are mechanisms for adequate ongoing repairs.

7.3 Cardy and the council project team, plus external technical civil engineering experts will carefully consider the outcomes of the surveys and work towards a solution that means that the repairing obligations to the council for ongoing maintenance will be kept to a level no higher than that which they would have been should the development not have proceeded.

I might add more later

does it add up

After the meeting with officers Edwina and Mike yesterday at Cecil Square, Margate I though I would stick my accountant hat on to see if the figures for the Royal Sands development add up for Cardy Construction.

As a prelude to this I would just say the building trade and therefore the saleability of the units have change greatly over the last few years and it is apparent that the new development, nearing completion, along the way is suffering as only 2 units so far have been reserved leaving a cash flow issue for that developer.

It is also true that hotels nowadays aren't being built by hoteliers but rather leased from a service company so effectively they are only tenanted and the proposed 60 bed 3* hotel being suggested is likely to go the same way. Its future value is more likely to be determined by its annual lease times 10 than a sale price. The same is likely to occur with any restaurants and coffee bars.

So lets do the sums 107 apartments @ average £300K equals £32M + hotel   + A3 units

assuming to build the hotel and fit out would cost around £5M you would look to a value of £7M to turn a profit, so 60 rooms @ £90 per night with occupancy of 78% equals turnover for rooms @ £1.49M less overheads @ 70%. this 70% would include annual lease of £700K as that's normally how hoteliers work in today's climate. The same would apply to the A3 use. That would mean the site fully developed would have a value of approximately £40-£42M. That on the face of it would be advantageous to Cardy who would expect to spend a further £20M building it all.

This is only half the story as cash flow would be their biggest problem as it is with most developers. Currently Cardy are out of pocket by £1.5M (give or take) and they have yet to pay Keegan what he thinks he deserves and the cost to TDC which in 2012 was just over £3M and is likely to have risen to just under £4m with the latest valuation.

So assuming the saleable element is the 107 apartments we have  £32M less SFP cost (£7M) + £4M (TDC) less build costs (assuming no over runs) makes a margin of £1M.

Assuming again Cardy transfer the A3 and hotel into a service company they will (assuming they do lease the units) have an ongoing cash flow of +£1M per year and not to be sniffed at.

There is however oen more issue as TDC officers understand they have a duty of care which is to divulge any issues that impact on the saleability of the build. In 2008 £900K was spend on cliff works and in 2012 a further inspection was made which had a number of recommendations none of which were started (but I bet the work was costed) As these recommendations are outstanding still the cost needs to be paid and as one of those was the painting had to be redone this is likely to be a future maintenance cost payable by the residents of the apartment owners in with their service charges.

I think that the saleability of apartments depend greatly on the ongoing service charges and this coupled with the damaging sea air would cause a lot of people to shy away from buying causing ongoing cashflow issues.

I am told in Oostende in Belgium there are many units like this already built were the developer has given away apartments to the builders because they cannot afford to pay the builder so they receive a benefit in kind.

Further if painting the cliff becomes a regular maintenance issue we all remember the scaffolding erected in 2008 and the moths of work carried out. On an open site that is a pain however imagine this in a 13ft access road which is the only access for deliveries, car parking and refuse removal.

Questions nothing but questions

A meeting was arranged today the 13th to discuss the following questions.

1.1.    Q&A put out as part of press release:

1.1.1.Point 3: How do you know if Hill & Keegan have a hold over Cardy Construction Ltd if your due diligence is only done on the new entity? You cannot ignore the rest of the company nor can you exclude other access to finance. For instance the deal where Cardy front Colin Hill in Lowestoft.

1.1.2.Point 4: leases can be done back to back, for example the Pavilion

1.1.3.Point 6: DA is being rewritten so yes you could change things and can someone explain why leases were sold on non-existent assets.

1.1.4.Point 7: Why should anyone trust this “due diligence any more than previous occasions? It would be better paying an external Forensic Accountant to answer all our questions surely.

1.1.5.Point 9: The cliff facade questions.

1.1.5.1.              What is the anticipated life of the columns?

1.1.5.2.              And the facade?

1.1.5.3.              How much do you anticipate spending on maintenance over the next 30 years?

1.1.5.4.               You talk about maintenance how much has been spent since January 2010 when one panel cost £20K.

1.1.5.5.              In 2012 the Facade was inspected what money has been spent and how many of the recommendations have been started and/or completed.

1.1.5.6.              What problems and additional expense would occur if the only access for maintenance work was a 13 foot access road?

1.1.5.7.              When was the last time anyone saw behind the facade?

1.1.5.8.              Point 10: Why doesn’t TDC work with Cardy and resolve the cliff facade by removing it completely?

1.1.6.Point 12: Is the EA being consulted as to whether an FRA and its recommendations is necessary rather than a cost to avoid?

1.1.7.Point 13: very nice statement but ignores the fact that they have been sitting exposed to the elements for 4 years, something reinforcing bars are not made for.

1.1.8.Cabinet

1.1.9.Please explain point 3.7

The DA will include a restriction in favour of TDC not to use the hotel site part of the property other than for a hotel.

1.1.10.                        Part 5 “due diligence” questions

1.1.10.1.           How can you guarantee information given to officers re: funding is 1) not forged 2) not linked to previous developer i.e. Keegan and Hill and how can you ensure no other funding hold is made on another Cardy company?

1.1.10.2.           Who “owns” the £1M surety on completion and as proper checks were never carried out by TDC on receipt, how can you ensure you aren’t “laundering” the funds when it is returned?

1.1.10.3.           Why aren’t checks being made by a neutral 3^rd party to ensure complete clarity?

1.1.11.                        Part 7 Cliff Maintenance

1.1.12.                        How can you have an ongoing contract with Cardy for the maintenance if they sell the freehold on and/or go bankrupt?

After spending an hour discussing these and having some questions referred back for answer later the over riding feeling is Officers are trying to do a much better job that in the last 12 years. That is to be applauded.

Should they not be pressured into making a decision due to the political needs of the members then maybe the correct decision be made. Whatever that is??

Freeholder

Having attended the Cabinet meeting in September and listened to the political point scoring from both Labour and Conservatives, One point that escaped the interest of the participants and that concerns the Freehold of the 7 acre former Pleasurama site.

Iris Johnston has said during a further meeting that the Conservatives (Ezekiel & Latchford) walked TDC into giving up the Freehold of the site, and Rick Everitt in his Q&A has clearly stated that:

6. Who will own the freehold once the site is developed?

The current contractual arrangements with SFP entered into in 2006 mean that the Council has substantially disposed of its freehold interest in the land (with freehold transfer provisions documented in the development agreement); the Council’s only continuing legal interest is the right to receive overage payments in respect of the completed units.
There is no change in this situation, the reason it is necessary for the transfer of the freehold is because the arrangement will enable the developer to grant for sale long leaseholds in the finished property.

Is this true? and does the blame for the disposal of the Freehold lie with Ezekiel & Latchford? Well No!
Although the wording in 6 above is true as it did form part of the Development Agreement signed in 2006 and also in 2009, the giving of the Freehold goes back to July/August of 2002.

During the Council Meeting held on the 25 July 2002 under point 41 the Council state 3 things

1. Officers be instructed to inform Ramsgate Boulevard Limited that the Council are not prepared to go forward with their scheme (effectively ending James Godden's interest in the site)

2. Officers be instructed to prepare a marketing brief to enable the site to be marketed as soon as possible. (This document was called "The Ramsgate Rennaissance Commercial Development Opportunity")

3. Officers be instructed to take possession of the site immediately

Now you have to remember that Leader of the Council and his deputy were Richard Nicholson and Iris Johnston and the Council majority was under Labour control. So it was Labour who instructed the Officers to prepare "The Ramsgate Rennaissance Commercial Development Opportunity" and what an opportunity as it is very unusual in Thanet that TDC relinquish the Freehold of a major (7 acre) seafront site but that is what was offered.

"7. Basis for disposal
 7.1 The Council intends to dispose of the identified development site on a freehold basis"

(page 24 of the above document)

So it is completely ridiculous for Labour to blame the Conservatives as it must have been their instructions to Officers which help sell the site to SFP Ventures (UK) Ltd in the first place.

As an aside it also begs the question as to why Ezekiel and Latchford used Leases to enable SFP to own the site as it could and probably should have been the Freehold that was sold in 2009.

Does O&S have any say

Extraordinary Overview & Scrutiny 25/9/2014

Cabinet had considered an officer report regarding Pleasurama on the 11^th September 2014. The decision was to allow officers to continue to progress the offer from Cardy to buy out Keegan’s interest in SFP Ventures (UK) Ltd and then to renegotiate the Development Agreement as the current agreement is “not fit for purpose”.

O&S considered this Cabinet decision and decided to call in the decision for the following reasons.

“I (Chairman Cllr Jo Gideon) am not persuaded by the argument and evidence given in the report to postpone implementing the earlier Cabinet decision agreed on the 20^th February 2014. I have some doubts about the clarity of aims and desired outcomes arising out of this decision and I would therefore wish for these to be explored further. Given the considerable local interest in the site I would wish the matter to be called in”

FORS has already written to the Chair and other members of O&S as follows

“We have probably been perceived as a protest group and in reality this is what caused us to unite in the first instance however time has moved on and the research we have conducted into the business dealing of Shaun Keegan et al has proved time and time again he is a man with no moral scruples.

We understand at this late hour Thanet Council has been thrown a lifeline by a reputable local building firm however history has proved over and over again that this may be an illusion and Thant Council have always seems to shy away from the difficult answer.

Many of you, and I include officers here, do not know or understand the long history of the site and the engagement of Shaun Keegan in 2002 and I would doubt anyone would know of the late Jimmy Godden's antics with the Council. What is clear from the research is that Shaun Keegan and his backers are playing a very long game here and until the Cabinet meeting the word land bankers hadn't even been acknowledged.

We would urge O&S to ensure a rigorous process of "due diligence" is followed as soon as the purchase of SFP Ventures (UK) ltd is confirmed and we find it extraordinarily difficult to understand why we have been told that this process has already started and is "going well". We would urge the engagement of a forensic accountant and if necessary a private detective to delve into the myriad companies both owned and influence by Keegan to ensure that this deal is open and transparent, because what is apparent TDC has been played for suckers for over 12 years by a very devious businessman. We would also urge those that do not know the history to read the very detailed blog at http://pleasurama.blogspot.co.uk/.

Finally we are ready to play our part in any decision making process however we cannot do that if O&S take the view that they know best and exclude us. We have a vested interest in whatever decision is made as we have to live with that decision and we would urge you not to shy away from a very difficult decision just because you perceive an 11th hour lifeline. As my father told me there is no such thing as a free lunch.”

The Chair wrote back to assure the meeting would be held in public and we then wrote back the following letter.

“Friends is appreciative of your email Mrs Gideon confirming this will be an open meeting and we would hope this continues into the future.

We would hope that many of the objectives of the Task & Finish Group are not neglected in this desire to achieve an acceptable settlement. We would like to take this opportunity to remind, should anyone have forgotten, the recommendations of the TFG set out on the 20th February 2014.

1. That the current development agreement and leases be terminated (yet to happen)

2. That there is no re-negotiation of the current development agreement (yet to happen)

3. That the previous advice from Eversheds solicitors be reviewed to determine why the development agreement did not contain a longstop date entitling the Council to terminate the agreement if the development was not completed by that date (yet to happen)

4. Completed so no issues

5. That the Construction expert be retained to support the officers in the monitoring of the development programme (yet to happen but still a good idea)

6. That the quality and condition of the existing construction work (including the foundations) be checked to confirm that it remains fit for purpose as a basis for further planned construction.(still to happen)

Further, in view of Cardy Construction's further links with SFP in Lowestoft, a rigorous "due diligence" process to be put into place by a forensic accountant after Cardy purchase SFP Ventures (UK) Ltd (and not before) to ensure that Cardy is acting totally independently from any of Shaun Keegan's associates.

Further that the developer's lease removes the obligation for TDC to maintain the cliff face behind the development.

Further any renegotiated lease and /or Development agreement ensures a fair consideration is received for a 7 acre site in a prime position with planning permission already granted.

Further to negotiate with the developer the removal of the Hotel complex and instead create a Piazza which can be used for the community and the holding of events on the seafront.

As it would be unusual for the communities interest to be protected by an independent member of the public sitting in negotiations as a witness we would like all current political parties involved so we would like another TFG given that job of overseeing negotiations.

We would hope to have been involved in these negotiations however we do have some expertise in investigating the issues and we would hope some input into the solutions as well.”

The meeting took place with several members questioning the evidence (or lack of it) being produced to support the Cabinet decision with the meeting seemingly becoming fractious with Cllr Everitt and acting CE Madeleine Homer appearing to be ill prepared for the level of questioning until Cllr Ian Driver proposed that the meeting be postponed until the members of the O&S had been given the opportunity to view the evidence.

This evidence comprises the legal advice from Pinsent Mason, The District Valuer’s re-evaluation of the site and the inspection of the cliff face facade being done on the 15/16^th October.

Further they asked that the discussions, currently ongoing with Cardy, be shared with the Committee. They elected to propose this motion and it was narrowly carried causing consternation on the part of the Labour members and officers present.

Having had some conversations with people since the meeting we believe that this Democratic decision is about to be overturned by the Labour Cabinet. We believe this (if it happens) will be a gross dereliction of the Democratic Process and will be met with considerable anger. They have to remember that all that has been requested is for the evidence examined by the Cabinet be made available to the O&S and further evidence of the valuation and the cliff facade be examined as soon as it is available.

Can the Cabinet do this?

Seemingly O&S can do 2 things with the Cabinet decision:-

1.      Recommendations can be referred to Cabinet for amendment or Cabinet can ignore.

2.      Recommendations can be referred to a full Council meeting.

In this case they have deferred a decision until they have properly examined the evidence and FORS believes that if the Cabinet have nothing to hide then deferment is an appropriate choice.

 A detailed Q&A was produced by Cllr Rick Everitt & Officers as follows:

1.    Why is the council talking to Cardy Construction Ltd about the Royal Sands Development site?
A default notice was served on the developer, SFP Ventures Ltd.  The development agreement provides for a mediation process to be entered into following the service of a default notice.  Each party to the mediation process is entitled to bring their team to the discussions.  SFP Ventures brought Cardy Construction Ltd to the mediation process and introduced this new offer arising from a company buy out by Cardy Construction.

2.    What is Cardy Construction Ltd’s offer?
Cardy Construction Ltd is offering to buy the share capital of SFP Ventures Ltd. Upon completion of their purchase of the company, the firm would be renamed and incorporated into the Cardy group of companies.
The offer includes the opportunity for Thanet District Council to enter into a new contract (Development Agreement) which enables the outstanding money owed to the council to be paid ahead of completing the development.  This is subject to a current market valuation to ensure the council gets the best consideration.

3.    If SFP Ltd sells their company to Cardy Construction Ltd, will SFP Ltd continue to be involved in the development?
Upon completion of the sale of the company, SFP Ventures Ltd will have no further interest in the site as we understand the company will be taken over and renamed.  The council’s due diligence process will confirm the validity of the legal entity of the company to ensure that Cardy Construction Ltd through its new company is the owner. (but will Keegan & Hill still have an interest?)

4.    Could the Council advertise for a new Joint Venture partner to develop the site?
The council has no legal rights to do this. The joint party in the development agreement is SFP Ventures Ltd, they can choose whether or not to sell their company and if they sell, who they sell it to.  (Of course they could it is called a back to back. have they taken legal advice, if yes what was the answer?)

5.    When would the building work begin?
Cardy Construction Ltd would commence works on site immediately upon conclusion of the signed contract (DA) and complete the project within two years (with a long stop date of three years).

6.    Who will own the freehold once the site is developed?
The current contractual arrangements with SFP entered into in 2006 mean that the Council has substantially disposed of its freehold interest in the land (with freehold transfer provisions documented in the development agreement); the Council’s only continuing legal interest is the right to receive overage payments in respect of the completed units. (except we are rewriting the DA)
There is no change in this situation, the reason it is necessary for the transfer of the freehold is because the arrangement will enable the developer to grant for sale long leaseholds in the finished property.

7.    What due diligence will be undertaken to ensure Cardy Construction Ltd is competent and capable of building out the site in a timely manner?
The due diligence process for a contract (DA) of this type is rigorous and includes obtaining evidence of a viable development appraisal, proof of the company entity and confirmation that funding is available to deliver the scheme.
One of the considerations to take into account is the company track record for delivering projects of this nature. Cardy Construction Ltd has been associated with the successful delivery and restoration of some of the most iconic and important buildings in Kent over the last 70 years including Discovery Park, QEQM Cancer Care, Rocksalt, Kent Cricket Ground, The Sands Hotel, Chilham Castle, Canterbury Cathedral, Kent and Christchurch Universities, Chatham Dockyard, East Kent Hospitals.  They have a consistent reputation of delivering quality projects. (Oh dear Alan Poole all over again)

8.    Will this support the economic regeneration of Ramsgate?
Yes. There would be direct employment opportunities during the construction project, Cardy Construction Ltd has demonstrated a desire to employ local tradesmen and apprentices to the project. Cardy Construction Ltd has confirmed it would also initiate a project specific apprenticeship training scheme through the Construction Industry Training Board and the local college.
Once constructed, the hotel, leisure and residential units would support on-going employment opportunities in the service and hospitality sectors. (This has been said so many times before yet it will be 12 years in December since we took on Keegan)

9.     Is the cliff wall sufficiently monitored to ensure structural stability?
The wall is regularly surveyed by TDC engineers and East Kent Engineering Partnership structure engineers.  It was last surveyed in July 2012 and is due again in 2015.  However, TDC has decided to bring this survey forward as part of this process and have now instructed a full structural survey to be completed on Thursday 16 and Friday 17 October.  (see the previous post only the Facade is monitored)

10.   Who will retain control for the maintenance of the cliff wall?
The cliff wall adjacent to the building site remains in the ownership of the council.  The cliff wall supports the land above the cliff including the promenade.  The council will retain responsibility for inspections and maintenance of the cliff wall. (please separate the Facade and the cliff face they are different. The facade supports nothing but itself)

11.    Are there any other monitoring authorities that TDC is consulting with to ensure the project is built in a safe manner and that the property once built will be adequately protected from flood risks?
There are specific construction laws that the council complies with to ensure suitable and sufficient safety systems are in place.  A project of this size is notifiable to the Health and Safety Executive (HSE) so that they can monitor progress. The council has contacted the HSE and invited them to review all safety files and they will be invited to project meetings if the project re-commences. (But still no FRA from the Environment Agency)

12.     What are the risks of flooding to the units once built?
The likelihood of flood to this area is a 1 in 200 year risk.  It is worth noting that the design of the buildings has taken this into account by putting the car parking on the ground floor, there is no residential accommodation at ground level.
Cardy Construction Ltd would ensure that it worked with the Environment Agency and Thanet District Council to have suitable and sufficient measures documented in a flood risk management plan to safeguard future occupants.  (Why no Flood Risk Assessment as the EA have requested)

13.      The existing construction work has been lying in the ground for some time – is TDC taking steps to ensure the existing construction is adequate?
The foundations have been designed by a professional practice of Chartered Civil and Structural Engineers with many years of experience of engineering design and coastal defence works around the Kent coast, including Thanet.  They have been designed in conjunction with specialist Geotechnical Engineers with very detailed reference and due regard to the extensive site investigation documents, including trial holes, trial pits and integrity testing, all of which have proved and verified the final choice that has been taken.
The design of the foundation complies with Building Regulation Requirements and very detailed and extensive calculations have been undertaken to verify this. The foundations have been inspected and approved and signed off at various stages of the works by Building Control and by the surveyor on behalf of the warranty provider. (However they have been in the ground for over 2 years without any protection and have NOT been inspected recently)

Cliffhanger

The integrity of Pleasurama has been much discussed lately and Thanetonline has much information about the issues as does this blog, however after the Overview & Scrutiny called in the Labour Cabinet decision because of the following:
The Chairman of the Overview and Scrutiny Panel called-in the Cabinet decision on 15 September 2014. In calling-in the decision the Chairman indicated the follows:
“I am not persuaded by the argument and evidence given in the report to postpone implementing the earlier Cabinet decision agreed on 20 February 2014.
I have some doubt about the clarity of aims and desired outcomes arising out of this decision and I would therefore wish for these to be explored further. Given the considerable local interest in the site I would wish for the matter to be called in.”

Overview and Scrutiny Part 1

During the debate much was discussed however I want to concentrate of the cliff facade and pose some serious questions.
Previous leaseholders of the Pleasurama site were responsible for the maintenance of the facade however when the new leases were drawn up between 2006 and 2009 for some strange reason not only did TDC take responsibility for the facade and the cliff face behind they also took responsibility for the maintenance as well. So that decision led to the following, the sale generated £550K from SFP Ventures (UK) ltd but in 2008 TDC paid out £900K (with a contribution of £100K from SFP) so that was a nett expenditure of £250K from out Council Tax.
Some explanation of this facade is required at this point.
The chalk cliff was covered with a facade of concrete columns along the 1/2 mile of the site cast against the cliff face however in 2010 it seemed there had been some separation of these columns away from the cliff.

Overview & Scrutiny Part 2

In between these columns had been place 100mm Concrete blocks to a height of about 45 feet however these blocks are not tied into the cliff and are angled such that the weight is supported on foundations described as "shallow and not well compacted"
After Cardy went on site late 2009 and less than a year after TDC spent £900K on the facade the HSE stopped all work on the site due to a bulge and cracks appearing in one panel. Engineers were called in and they inspected. The cause of the bulge was "We suspect the void was filled with the fallen debris (of the chalk) causing a force onto the blockwork skin which could not be resisted" Remember this is 100mm concrete blocks 45 feet high angled inward so how dangerous a force is that hidden behind a 1/2 mile stretch of facade (out of sight out of mind)
This was repaired at a cost to the Council of £20K and only one panel.

Their recommendation were that no works should commence until the structural integrity of the cliff face is established and/or made sound. It is important to understand at this point it is the cliff face hidden behind the facade is what needs inspecting and to date no one has looked (you need boreholes and cameras) You also have to remember the integrity of the chalk has been compromised by tunneling and the firing of howitzers mounted on the Eastcliff during the 2nd World War.

What is important to the building of apartments in front of this cliff is the only route for deliveries, refuse collecting and vehicular access for the leaseholders is a 13ft access road to the rear of the building creating a canyon with a building one side and a cliff face on the other. If maintenance or, God forbid, a fall that effectively cuts off access to the building.

Overview and Scrutiny Part 3

My final point concerns the transfer of the freehold to the developer and the removal of the current leases leaving the freeholder the ability to draw up new leases for each apartment and A3 business. The freeholder will be able to place the onus for the maintenance onto the leaseholder via the ground rent charged, in fact, he would be foolish if he didn't as the building owners would be unable to recoup costs should they fail to do this. As the anticipated life span of the facade is currently unknown it is doubtful any solicitor's searching will be happy with an unknown it would be doubtful whether future purchases of the property would be either.

Overview and Scrutiny part 4

Rick Everitt last night assured the meeting they were fully aware of the issue of maintenance and confirmed an inspection will take place on the 15th and 16th of October. However as the site is 1/2 mile long and what is at issue is the integrity of the cliff face not the facade it is doubtful whether boreholes and cameras will be used to inspect the real issues.