Innovative property company to be established

It has been an aspiration of Ashford Borough Council for some time to use its expertise in a commercial, entrepreneurial way to generate revenue.

This has already seen cabinet give the go ahead for the creation of a building control company, which will undertake all discretionary services that the building control service currently provides, such as thermal modelling of buildings and specialist design advice.

Now, following an independent review by a leading advisory firm, the business plan for the property company the council wishes to set up has been deemed sound and they have made recommendations to strengthen it, which have been agreed by cabinet.

The property company will build on the expertise within the current housing service to provide a range of high-quality housing for rent to meet the needs of the people of the borough, provide suitable accommodation for vulnerable residents and be the landlord for tenants in these properties. Additionally, other activity will be undertaken to promote regeneration in the borough to improve economic, environmental and social wellbeing. This may mean acquiring properties that can then be rented out, for example.

Through their work the local authority companies must promote the economic, environmental and social wellbeing of the area and must provide opportunities, through procurement, to support local businesses. The council’s approach is based on other successful models that it has studied.

Extensive business plans were presented to cabinet in June and the comments by overview and scrutiny were taken on board by cabinet members last July. Since then, investigative work has been undertaken to strengthen the company and improve its liquidity. The council will borrow from the Public Works Loan Board at a competitive interest rate to grow the businesses and will repay the loans as the company makes returns. The loans to the Property Company will be secured on the properties purchased.

Cllr Gerry Clarkson, Leader of Ashford Borough Council, said:

“The property company is a hallmark of our innovation and cutting-edge thinking. We are establishing a more entrepreneurial approach within the council and adopting a commercial approach is, we firmly believe, the best way for us to deliver a better future for our residents. This is a proven model that can work here and will be an example for other district authorities to follow in due course.”

Cllr Neil Shorter, Ashford Borough Council’s portfolio holder for resource management and control, said:

“This enterprise clearly demonstrates our intent to become an organisation with an appetite to secure a business-based approach to our future viability and capability. Over time we have looked at a variety of options to improve our service delivery, such as shared services and partnership working and we feel that this company structure, long term, is another delivery model, to benefit the residents of Ashford, by the creation of another revenue stream to support service delivery as well as delivering new homes.”