Decision details

The Cabinet will be asked to approve development funding of circa £7.2m for the construction of a 78-bed Travelodge hotel and a shop unit at the former Sanofi site at Dagenham East.

The Cabinet resolved to:

(i)  Agree to the acquisition of the freehold interest at Yewtree Avenue, Dagenham RM10 7XS (the Property, as shown in Appendix 1 to the report), subject to completion of further due diligence and to the principle of borrowing up to £940,000 plus stamp duty of £36,500 and fees of £110,500 within the General Fund from the Public Works Loan Board;

(ii)  Agree to the principle of borrowing up to £5,711,000 within the General Fund from the Public Works Loan Board to fund the development costs of the Travelodge development;

(iii)  Agree, subject to completion of further due diligence, to enter into a Development Agreement with Berkeley Square Developments to construct the development scheme on the Property;

(iv)  Note that the acquisition of the Property shall be subject to an extant agreement for lease, which upon acquisition the Council would be bound to grant and agree, subject to completion of due diligence, to grant a 25-year lease to Travelodge Hotels Limited on the terms set out in the report;

(v)  Agree to hold the Travelodge investment within a Special Purpose Vehicle (if legal advice indicated this would be appropriate);

(vi)  Agree that Be First, as agent for the Council, be authorised to lead the negotiations, including appointment and management of property, financial and legal advisors as required;

(vii)  Delegate authority to the Chief Operating Officer, in consultation with Director of Law and Governance and the Cabinet Members for Finance, Growth and Investment and Economic and Social Development, to scrutinise the due diligence reports, negotiate terms and agree the contract documents to fully implement and effect the proposals set out in the report (including a decision as to utilising a SPV); and

(viii)  Authorise the Director of Law and Governance, or an authorised delegate on her behalf, in consultation with the Chief Operating Officer, to execute all the legal agreements, contracts and other documents on behalf of the Council.