Minutes:
(Mr. G. Millar, Director of Property and Projects, attended in connection with this item.)
The Committee considered the undernoted report, together with an associated business plan in respect of the proposed relocation of the Belfast Welcome Centre:
“1 Relevant Background Information
1.1 Committee Decisions
Members have previously been briefed on the possibility of relocating Belfast Visitor and Convention Bureau/Belfast Welcome Centre. Tourism and Travel Consult International and Allan Balnaves produced an initial report (Rationale for relocating Belfast Welcome Centre) demonstrating the potential of the BWC relocation to ground floor premises which was presented to Development Committee on 13 January 2010.
1.2 ASM Howarth was appointed in October 2010 to undertake an economic appraisal and presented initial recommendations to the Development Committee on 10 November 2010.
Following a special meeting of the Development Committee on 22 February 2011 the Committee agreed to note the information provided within the report and agreed further to allocate £15,000 towards the development of a full business case for each of the options, subject to the Strategic Policy and Resources Committee agreeing that the project be included within the Capital Programme.
1.3 This minute was subsequently amended at Council on 2 March 2011 for further sites within the city to be included as options for the relocation of BVCB/BWC.
1.4 The Strategic Policy and Resources Committee at its meeting on 18 March 2011 approved the development of a full business case for the relocation of BVCB/BWC for a generic city centre location with the outcome of the full business case to be presented to the Strategic Policy and Resources Committee when available to permit the committee to consider the proposal further. The selection of a site would follow from available options at the appropriate time following further decisions on availability of grant and capital funding.
1.5 The Strategic Policy and Resources Committee, at their meeting on 23 September 2011 and the Development Committee, at their meeting of 27th September 2011, agreed to support a funding application to NITB Tourism Development Scheme (TDS) for capital funding associated with the Belfast Welcome Centre.
1.6 BCVB presented their business plan for 2012/13 to Development Committee on 24 January 2012.
2 Key Issues
2.1 Council Draft Investment Programme 2012-2015
The relocation of the BWC is included as an emerging Council-led investment project in the draft Investment Programme 2012-2015. The Strategic Policy and Resources Committee is currently considering the governance arrangements to support the Investment Programme. However, due to the timing issues around the TDS funding, the end date of the lease for the current premises and the desire by BVCB to relocate in time to maximise on the World Police and Fire Games, the Development Committee are being requested to make a recommendation to the Strategic Policy and Resources Committee in advance of the governance arrangements being agreed.
The need for ground floor premises for the BWC has been again evidenced in the recent work of Dr John Heeley who prepared the visioning paper for BVCB. It reiterates that to relocate BWC to ground floor premises will provide better more accessible services and facilities for visitors to Belfast.
2.2 Lease of Existing Premises
Belfast City Council’s lease on the current premises in Donegall Place terminates on 31 July 2013. In order to be in a position to relocate at the end of the tenancy and to secure funding and approvals within the timescale Members will need to agree new premises as soon as possible. BVCB hope to relocate by April 2013 to maximise on the potential from the World Police and Fire Games and summer 2013 tourism. Assuming an April 2013 relocation date this gives 12 months to conclude on negotiating final lease terms, secure funding, completion of legal documentation, planning, tender process, and award of tender for design and fit out, fit out and completion of works.
If a decision on relocation is not made imminently then the chances of relocation before the current lease end date are extremely unlikely. In this scenario there is little likelihood of the landlord in the current premises agreeing to a further short term lease extension.
2.3 Tourism Development Scheme (TDS Funding)
An application for funding for capital works for a generic site was submitted to the Northern Ireland Tourist Board Tourism Development Scheme on 6 January 2012. The application was for 50% of estimated capital costs of £1.62m to cover the cost of fit out for potential new premises. The TDS monies if secured are required to be spent by June 2013. In order to be able to use any grant offered a decision on relocation is required as soon as possible.
2.4 Business Case
The full business case has been prepared in response to the Development and Strategic Policy and Resources Committee decisions of March 2011. The business case concludes that a relocated BWC can deliver
- A 20% growth in footfall by moving to ground floor
Premises
- By 2015/16 receive 459,000 visitor enquiries per annum generating a wider economic of £10.93m per annum
- Operate with an average annual surplus of £30,000
2.5 Remaining at the current premises is unlikely to be viable. Despite the expected uplift in visitors to the city in the short to medium term, it has already been identified that the current premises have some degree of difficulty in dealing with the present volume of throughput. Therefore the opportunity to maximise income from additional visitors is likely to be compromised at this location, the result being that the proposed reduction in subvention from NITB will have a profound effect on the viability of the BWC.
2.6 The business plan has been prepared on the premise that NITB decreases its revenue support by 50% whilst the level of support from BCC would not increase remaining at £479,000 per annum for the next five years.
2.7 The projections have also been subject to sensitivity analysis and the relocation remains viable even when a 10% increase in rent is applied. However if income is decreased through lack of footfall and a decrease in income via advertising occurs a worst case scenario has suggested that there would be an average deficit of £30,000 per annum. BVCB has provided assurance that should this be the case, they could manage this deficit through other cut backs without additional support required from BCC.
2.8 New Premises
The Estates Management Unit in Property and Projects has for some time been undertaking property searches for a relocated Welcome Centre. The visioning paper prepared for BVCB by Dr John Heeley identified that the modern Tourist Information Centre should have five key building blocks
i) Look and feel - modern premises for experiences and encounters
ii) Commerciality - the ability to create additional revenue
iii) Customer Handling - space to meet and greet. Personal service
iv) Technology - High specification and speed information technology
v) Adaptability – Wider visitor servicing requirements across the region
2.9 BVCB have provided the Property and Projects department with their specific spatial and locational requirements which have been clarified and defined by the visioning paper and business plan.
2.10 It should be pointed out that whilst in the current market rents have been driven downwards, if there is a future upturn in the market the largest increases will occur in the prime retail space in the city centre. Any assessment of the available properties has to therefore reflect the impact of future operational costs with ground floor retail space attracting the highest value. BCC has looked at premises in secondary locations and significant savings on premises costs can be achieved if the location of the Welcome Centre is moved away from the retail core, however this would be at the expense of footfall and visibility which have been highlighted as necessities by BVCB/BWC and the vision and business plans.
2.11 An extensive review of available properties, based on the requirements of BVCB, has been undertaken by the Estates Unit, and four properties were subsequently identified as being closest in matching the requirements of BVCB/BWC.
2.12 One of the properties in Royal Avenue lies outside the high footfall requirement of both the visioning paper and business plan. A property in Donegall Place whilst having suitable ground floor accommodation has restricted upper floor space to accommodate BVCB and of significant importance requires major refurbishment work to bring it up to a satisfactory standard. An opportunity exists for a new build premises in Chichester Street however it is unlikely to be available in time to meet the tourist opportunity from April 2013 onwards or to be delivered prior to lease end on the existing Welcome Centre premises. A further option includes an amalgamation of premises in Chichester Street; however with lease surrender negotiations to be completed with the existing tenant this option is unlikely to meet the timescale for BVCB and the TDS funding.
2.13 On the basis of the information the property that provides the ‘best fit’ and opportunity for a modern Tourist Information Centre are the premises in 8-10 Donegall Square North. It is being recommended therefore that Members request that Strategic Policy and Resources Committee complete lease negotiations on the most favourable terms for these premises at 8-10 Donegall Square North.
3 Resource Implications
3.1 Financial
The ongoing revenue support towards the Belfast Welcome Centre would remain at current levels - £479,000 per annum to be covered by the Development Department. Capital Programme commitment required to fund fit out and capital works on top of Tourism Development Scheme funding if secured. Estimated total capital cost for fit out at £1.62M. The Development Committee is being asked to commend to the Strategic Policy and Resources Committee that this project is moved to the committed Capital Programme and that 50% of the £1.62m is allocated accordingly.
Human Resources
Property and Projects and Legal Services staff to complete new lease negotiations, manage project within capital programme and vacate existing premises subject to all terms of existing lease.
Asset and Other Implications
Finalisation of lease negotiations for new premises to be taken forward by the Property and Projects Department, subject to approval from the Strategic Policy and Resources Committee.
4 Recommendations
1. Approve the business plan prepared by ASM Howarth.
2. Recommend to Strategic Policy and Resources Committee that officers can complete lease negotiations on 8-10 Donegall Square North, Belfast.
3. Request that Strategic Policy and Resources Committee move the relocation of a Welcome Centre to a committed Capital Project in the Capital Programme and Investment Programme 2012 - 2015 and that 50% of the £1.62m is allocated accordingly.”
After discussion, it was
Moved by Alderman Ekin,
Seconded by Councillor Hartley and
Resolved – That the Committee agrees to adopt the recommendations.