Following confirmation from Malcolm Thorpe that the “harbour businesses” will be offered for sale, we consider the implications of this news. Please bear in mind that these are initial thoughts, as no detail is available on which to make final judgements.
Opportunity for a ‘reset’
In any event, a sale represents a golden opportunity for a reset of how the SHA is managed, and BHT’s relationship with the owners.
We are confident that good communication can be restored with any new owner committed to following harbour legislation and government guidance, which provides for SHA openness, reinvestment, and management in the broad public interest. We warmly welcome questions from any interested parties who would like further information.
The possibility of a BHT bid
BHT must be pragmatic and act within the confines of its aims and objectives. It must also acknowledge the fact that the harbour owners may prefer to deal with others.
In the event of BHT bidding, it must take heed of professional advice on the amount it should or could reasonably offer, based upon valuation and the public interest served, whereas other bidders may be able to take a more nuanced approach.
General considerations re the sale
Other bidders may be able to ‘take a view’. This would not concern BHT provided that the interests of the Harbour were not damaged in the process.
It is clear that neither BHT nor any other buyer would be helping the harbour if a high bid left the SHA loaded with the cost of debt and/or liabilities that are nothing to do with its operation (as happened in 2011). By contrast investment in the harbour (ie for works and improvements) is to be encouraged and would obviously merit a return for the funders.
Share value: we must take account of the (1963 Act’s Section 31) limitations on returns that protect revenues for reinvestment.
Value of surrounding land: we note the s106 planning agreement restricts the returns legitimately available to the developers of the proposed housing land, as profits are intended to fund improvements. Based on actual costs and existing use land value, the s106 ensures that anything over 20% of sale values must be paid to the SHA for other improvements.
BHT’s overarching consideration is to do what’s best for the harbour. For pragmatism, we would certainly consider supporting a ‘community interest group’.
Meanwhile its ‘Business as usual’
Mr Thorpe points out that marketing and sale may be a long process and that its “business as usual” in the meantime. BHT should not take its eye off the ball and must continue its actions to protect the harbour. The finances, condition and environment of the harbour should be maintained in the best possible shape if it is to have the best chance of thriving under a new owner, whoever that proves to be.
We will give you an update on other news shortly.
Please do get in touch with thoughts and questions.
Chris Attrill, Jonathan Bacon, William Bland , Jeremy Gully (chair), Phil Jordan, Norman Marshall, Sara Smith, as Trustees
For and on behalf of
Bembridge Harbour Trust