MY LEGACY What has happened to my legacy – Part one

Richard Allen

Richard is an honorary member of ACES who was President in 2004/05, a member of ACES Council for a number of years, and a stalwart of Heart of England Branch, both before and after his retirement in 2008. Up to that date he had worked for Nottingham City Council for 35 years.

In this first of a two-part article, Richard gives a factual account of his experiences at Nottingham City Council. But not to be a spoiler, both pieces are really about leadership, knowledge, power, communication, collaboration, and the changing profile and roles of chief estate surveyors working in public sector property. Richard also promotes the benefits of ACES membership, especially the necessity to network. 

Introduction 

On my retirement in 2008 from Nottingham City Council, the Leader wrote me a personal letter thanking me for the contribution I had made to the city, and which ended “I know you are leaving a legacy for the future which we are all proud of”. 

In my retirement speech, having spent 35 years with the council and 8 of those years leading the property team in my position as Assistant Director (Property), I referred to the legacy I was leaving. A well established professional ‘family’ property team; a property portfolio worth £1bn (excluding council housing) 'the family silver'; an investment portfolio yielding 6% p.a. that supported economic development and growth, worth £200m, and which had returned 225% over 10 years to 2007 (capital growth, income and sales,) - better than the IPD commercial property 205% and Footsie all share index 82%; an authority that had worked in silos starting to work corporately, thus now in a position to rationalise its operational property; and the Broadmarsh shopping centre flagship redevelopment, which I had been personally working on for 10 years, that would put the city back into the top tier of nationally ranked retail centres, generate more revenue for the council and fund a new bus station and car park. 

Nottingham City Council is now effectively bankrupt. The family silver is being broken up to raise £100m from capital sales to reduce an £800m debt and a £30m revenue shortfall last year. The government top commissioner overseeing Nottingham said recently that the council needs to stop being inefficient and that it is blindingly obvious that it has not been making the best use of its properties. Given the significant financial and resource constraints the council faces, the now partly demolished former Broadmarsh shopping centre, probably the largest and most important city centre development site in the UK, is to be sold ‘off market’ to a buyer with a ‘considerable track record of major development’. 

Current view across partly demolished former Broadmarsh Shopping Centre site

My favourite author is Ken Follett who writes historical novels and pays tribute to the dedicated historians who undertake the research for his work. He says “without them we would not understand where we come from. And it makes it even more difficult to figure out where we are going.” This statement is the inspiration for writing another of my final articles for ACES’ Terrier (actually two articles). As one of the older members of ACES, I am in a position to look back to 1973 when I joined Nottingham City Council. Over the articles I will look at how the role of the Chief Estate Surveyor and use of property as an asset at my old authority evolved. This first article will cover the period up to my retirement in 2008 and explain the legacy. My second article will cover the period from 2008 to the present day, and tries to explain what has happened to the legacy during very challenging times for all local authorities. 

The legacy 

Knowledge is power 

After obtaining a BSc (Estate Management) degree at the College of Estate Management, my first four working years were spent with the British Rail Property Board. With a degree in the subject, I was fast tracked on the estate management training scheme. The training was good. It taught me much, in particular the art of communication. When, why and how to communicate, both verbally and written, and only to put anything in writing when necessary. I was also learning the meaning of the adage ‘knowledge is power’. 

Chief estate surveyors with passion, profile and power 

In September 1973 I joined Nottingham City Council as a Senior Estate Surveyor in the Estates Department. The council had an interest in over half the land area within the city boundary and extensive land holdings beyond the boundary, as a result of the enclosure awards, philanthropic gifts of land, and opportunist land banking acquisitions. The Estates department was large with around 40, mainly young, chartered surveyors: half involved in compulsory purchase work, about 30% in managing the estate, and 20% buying or selling houses depending on whether Labour or the Tories were in power. The political control changed a few times in my early years at the authority until finally it became Labour, to which it has remained until this day. 

During my first week I was approached by a very smartly dressed silver haired gentleman. He told me that he was the Consultant Surveyor to the authority but had been for a number of years the Chief Estates Surveyor. He explained that the authority had elected members who thought that they ran the council, but he had been responsible for all property decisions. If the elected members wanted to do something silly or inappropriate, he would tell them and it would not happen on his watch. 

After just 6 months there was a local government reorganisation. Education and social services roles were transferred to Nottinghamshire County Council. Nottingham City Council became very much a district council dominated by its housing role. The estates set up, renamed the Land Division, became part of a large multi disciplinary Department of Technical Services, bringing together estate surveyors, architects, civil engineers and quantity surveyors. The Assistant Director (Land) was the ACES member who was also a founder member of the Heart of England Branch. 

The Department was led by a chartered quantity surveyor, but who always had a copy of ‘Modern Methods of Valuation’ on the corner of his desk. He was full of ideas, passionate, pragmatic, high profile and thought and acted more like a chief estate surveyor. The authority operated in silos. The Chief Executive was the Town Clerk, a lawyer whose role was primarily just to make sure the council was not acting ultra vires and to organise elections. If anything needed to be done they had to come to the director of my department. 

So the authority was run effectively really by the person who was the chief estates surveyor, as he was the most powerful officer in the council. The elected members were ambitious for the city and the department was proactive. Its work initially was mainly completing the slum clearance programme, development of new housing, and regeneration of the city centre. The planners had promoted the development of two large, covered shopping centres at the end of the 1960s. The Victoria Centre would cater for the residents in the north of the city and Broadmarsh for those in the south. It created what came to be known as a dumb bell retail centre. The first to be completed was the Victoria Centre, built on the site of the old Great Central railway station. No site assembly was needed as it was in one ownership. The Broadmarsh Centre, on the other hand, had to be developed on a site assembled by the city council using CPO powers. All this took time. It meant that the Victoria Centre was anchored by Jessops, the major department store in the city at the time, now John Lewis. It was the first to open. The Broadmarsh anchor was the local Coop, so it was always considered to be the secondary shopping centre in the city. 

During the late 1970s and early 1980s the country was in recession. Manufacturing and heavy industry declined. The council focus changed. Almost all development stalled in the city. The departmental director and labour elected members considered it was their role ‘to make things happen’ in the city. And to do so take risks. The council offered to gap fund strategically important developments through Urban Development Grants. This approach was successful, adopted nationally and became known as City Grants. 

A number of major housing developers went bust in the recession due to land banking and huge increases in borrowing costs. The council offered development sites to the market on the basis of housing partnership schemes. Houses were built on a licence arrangement with the land and built houses sold directly to the house purchasers; developers did not have to borrow to purchase the land. The country’s future lay in the development of small to medium size enterprises. Led by our director, the council started a programme of building small business units. Over the next 30 years it developed around 600 small industrial and business units in numerous courts and refurbished former textile factories. It developed a science park in partnership with Nottingham University, a number of business centres, and a food park. 

The images show the entrance to the Nottingham Science Park, developed over many years to support economic development, and Karlsruhe House, which was the last factory to be purchased by the council and converted into workspace for small/medium size enterprises. 

Nottingham Science Park

Karlsruhe House

Initially the developments were funded by the council but the majority were funded through the government’s urban programme. Some of these grants were meant to be repaid but I know in many cases this did not happen. The department set up an economic development unit and offered grants and advice to small business. To raise the profile and improve the marketing of its investment properties, particularly those that supported the growth of small businesses, it branded the investment team estate surveyors as ‘Nottingham Property Plus’, the ‘plus’ standing for a landlord the tenant would know and trust, who would take on responsibility for the major property costs such as external and structural repairs and insurance, would provide business support and access to grants, and with a large network of workspace across the city, would enable businesses to move easily to larger premises as the business grew. 

Decline of the chief estate surveyor 

At the end of the 1980s there was another recession. The old Town Clerk retired and the council created the new much stronger leadership role for a chief executive to modernise working practises. Departments were reorganised and the property function ended up with the architects in a new Department of Design and Property Services, but still under the existing Director. Economic development went to a new Development department, which included the town planning role. Regeneration was to take place through public/private sector partnerships. Government quangos were set up to promote and manage regeneration and the allocation of grants. The council property professionals and property assets started to take on a more supporting role rather than driving regeneration and economic development. 

Asset management planning raises the profile of property 

Public sector growth was also out of control. An Audit Commission report was highly critical of how local authorities used their property assets. The departmental director had by then retired. The new one was an architect close to retirement. All local authorities had to appoint a Corporate Property Officer to write an Asset Management Plan (AMP). At the time, my position was Assistant Director (Property) so I took on that position and wrote the first AMP. It was written to a format prescribed by central government setting out how an authority would manage its assets, collect data, and produce performance indicators on condition and usage. It was heavily process driven and to succeed, needed an authority to work in a corporate way. 

The council’s first corporate chief executive had introduced service planning for all services. Rather than achieving a corporate approach, this just encouraged more silo working. In 1998 the council took over responsibility for the services it had lost in 1974 and focus shifted from housing to education as the secondary and primary schools were bottom, and third from bottom, respectively of the national schools’ performance tables. 

Over a five-year period, after the requirement to produce AMPs was introduced, the council had four chief executives who all tried to get the council officers to work in a corporate way. A new first tier of management was introduced: corporate directors. But departmentalism and silo working were firmly embedded in the culture. Property was seen as a free resource. Getting the council to understand that property was a corporate resource, rather than individual departmental assets, was slow. But it was starting to happen by the time I retired. Knowledge was being shared and power conceded to support a collaborative approach to the use of resources. One service manager did, however, say to me he was only ‘playing the game’ while he had to, but that he would revert back this old ways once he could. So there was still work to be done. 

In 2004/05 I had the privilege of being the President of ACES. I adopted as my theme ‘Profile and Pride’. Profile because the production of AMPs and corporate collaborative working was raising both the profile of property and the role of the chief estate surveyor in local government to use property as a resource to influence and shape their communities, thus leaving a legacy for their community of which they could be proud. 

Broadmarsh shopping centre redevelopment 

During my time at the council, the various economic driven developments added revenue to its investment portfolio. But around a fifth of the rental income came from its ground rent in the Broadmarsh shopping centre. Under the lease, the council received one third of the gross (not net) rent: a very favourable arrangement for the council. But the centre was lagging behind the Victoria Centre and needed investment. Together with the inner ring road, which ran immediately to the south of the centre, it was a barrier between the station and city centre. 

In 1988 a meeting was held with Possfund, the then owners of the shopping centre, with a view to redeveloping the centre and moving the ring road south of the station. As the country was going into recession no progress was made until the late 1990s when serious talks on a scheme started. Possfund eventually sold the centre to Westfield, the largest shopping centre operator in Australia, who wanted to move into Europe. In 2005, during the week when I held my ACES Presidential Conference in Nottingham, a development agreement was signed. It was conditional on Westfield getting an anchor store for the centre and 25% prelets. The store would be 2.5 times its existing size and would cost the council nothing. The council income was to be protected during the development period and the scheme would also pay for a new bus station, car park and road improvements in the area. A great deal for the city, or so it seemed at the time. 

Mistakes 

Significant change took place in Nottingham during my 35 years at the council. Much had been property led. But it would be wrong to say that it had all been perfect. Mistakes were made, particularly with housing. The slum clearance programme nationally had been a fast-track programme to get people out of poor housing. It was not a programme to get people into good housing. There was little time or thought given to the layout and design of the new housing. Many of the developments, particularly the poorly designed deck access estates, have had to be demolished and rebuilt at significant cost to the public purse. Similar mistakes must not happen in this government’s ‘dash’ to develop much need housing. 

In the 1960s the council built Maid Marion Way, a dual carriage way on the west side of the city centre: the start of an inner ring road programme that did not materialise. The open air Mount Street Bus Station that was just outside this new road, which served Derby and towns west of the city, was then developed as a covered bus station, shopping arcade and multi-storey car park. Because it was cut off from the city centre, it became a ‘white elephant’ as the shops were never occupied and the bus station soon closed. History may be repeating itself at the Broad Marsh which I will refer to in my next article. 

Outsourcing starts 

The Estates department I joined in 1973 was clearly over resourced. The private sector was not that much better. Each year services had to make budget savings which could usually be achieved by not filling vacancies. Because everything was done in-house, the quality of some work was questionable. 

In 1990 there was a national property rating revaluation. The last revaluation had been in 1972, and a retired senior estate and valuation surveyor had been brought out of retirement to deal with the appeals. There was no in-house expertise and not a lot in the private sector. I was responsible for a team appealing, where appropriate, the new valuations but decided we needed help. The bigger and more difficult appeals were outsourced to a local experienced rating surveyor. The Concert Hall and Theatre Royal was given a combined rateable value of £1.23m. 

Theatre Royal/Concert Hall complex

Modern theatre building

This valuation was based on the ‘contractors test’ method of valuation. This basis of valuation was challenged at the Valuation Tribunal. Our consultant rating surveyor ran rings around a very capable district valuer and convinced the tribunal that a ‘comparative’ valuation could be justified. The main evidence was the Albert Hall, the location for my presidential conference in 2005, which had been let on the open market. 

Interior of the Albert Hall

The rateable value was reduced to £174,000, and even with the phasing in of the rates to be paid, it represented future savings to the council of many millions of pounds. The consultant’s fee was based on a percentage of the reduction in the rateable value. It was in six figures. For the next revaluation the fee was to be paid on a falling percentage basis with a cap. We were learning the rules of outsourcing. It convinced me that there are times when the private sector knows best and should be used. 

To determine whether work is done in-house or outsourced should be subjected to the ‘time, quality and cost’ test. If doing it in-house fails any of these tests then outsourcing should be at least considered: far better way of demonstrating best value than the so-called 4Cs: ‘challenge, consult, compare, and compete’, introduced in the 90s and used by the Audit Commission. To outsource work and operate in partnership with the private sector, it is essential to know how this sector works. Something I quickly needed to learn, as partnership working, outsourcing and using consultants was to become more the norm. Gaining this knowledge and the outsourcing skills I needed proved to be by far the best benefit I got from my ACES membership. 

My time was up 

During the 39 years of my working life, the biggest change in the workplace was the introduction of information technology. Communication was no longer an art. It was becoming a science. In the end I was being bombarded daily by emails: to many, ill thought out and badly written. It was taking longer to complete things than when I started work in 1969. Leadership and managing staff performance was becoming increasingly more difficult. Having just turned 60 I decided my time was up. 

To be continued…..