Decision details

Enterprise Gateway Project, Plot 12 Terminus Road, Chichester

Decision Maker: Council

Decision status: Recommendations Approved

Is Key decision?: No

Is subject to call in?: No


Mrs Keegan (Cabinet Member for Commercial Services), seconded by Mrs Lintill, moved the recommendation of the Cabinet. She reminded the Council that the Cabinet had approved a Project Initiation Document (PID) for the redevelopment of Plot 12 Terminus Road, Chichester, for an Enterprise Gateway. This would consist of around 90 business units and be expected to facilitate the creation of between 250 and 275 jobs every three years, to lead to the establishment of new businesses and to contribute to an improvement in business survival rates, as well as providing a rental income to the Council.


In May 2014, the Council had approved the allocation of £4,021,000 of capital reserves funding to the project, based on estimates by the Council’s consultants.


Subsequently an architect had provided a feasibility study including a schematic design plan for the Enterprise Gateway. Subject to approval by the Council of the Cabinet’s recommendation, the Cabinet had authorised release of £88,500 of the allocated budget to proceed to planning stage and tender for the construction of the Gateway. Following an EU compliant tender, an operational management company had also been selected subject to the eventual delivery of the project. This company offered the Council a guaranteed income and profit share potential that gave an attractive return on investment.


However, the total estimated cost of the project had now risen to £6,245, 860, and the Council was asked to allocate the additional budget of £2,224,860 from capital reserves. The Cabinet had asked that a further report be made to them before acceptance of any tender for construction, and so the budget would not be committed (apart from the £88,500) until further work had been carried out and greater certainty about costs was available.


Members expressed concern at the very substantial increase in costs. Mrs Keegan explained that, between estimates, building costs had inflated by 23%. The original estimate had been at a high level, and Mrs Hotchkiss (Head of Commercial Services) added that more detail was now available on fit-out, access and parking.


Members also expressed concerns at the lack of detail in the Cabinet report and questioned the accuracy of other figures, such as the valuation of the completed site and the return on investment. 


It was pointed out that the Cabinet had previously approved a PID which contained more detailed information. Mrs Keegan assured the Council that she and Mr Ransley, whom she had appointed as a special adviser, would meet the consultants to examine the costs and risks more closely and liaise closely with officers throughout the design stage of the project.




Having noted that the total estimated cost of the project is £6,245,860 (details in appendix section 1.0 (exempt information)), that the additional budget of £2,224,860 be allocated from capital reserves.


Report author: Mr Patrick Harrison

Publication date: 14/07/2015

Date of decision: 14/07/2015

Decided at meeting: 14/07/2015 - Council