Tuesday, 26 June 2012

The Royal Sands Development on the Pleasurama Site in Ramsgate, another update.


The months and years roll by with this one and my updates are now so numerous that I am not entirely sure just what I have already covered.


I guess most people in Ramsgate will have noticed that around the beginning of this year all work stopped on the site, this happened very suddenly in the middle of half completed work, giving all the signs of the money running out.


My understanding of the situation at the moment is that the developer is seeking a new and different agreement with the council in the hope of attracting some funding, so the development can be completed.


The idea being that the council sell the freehold to the developer for about one and a half million now and about the same, as a proportion, as the different parts of the development are completed and sold.


What this would mean is that the developer would own the freehold to the site and could use it as security to attract funding.


Over the last few months the council and the developer’s lawyer have been thrashing out the phrasing of a new development agreement that will be put to the council’s cabinet, and they will either approve it or not.


From the point of view of the ordinary person, who has Ramsgate’s interests in mind, the main problem here is one of transparency, as everything about this development seems to happen in a shroud of secrecy, it is very difficult for local people to have any input until it is too late and the delays start again.


In practical terms there are aspects of the plans for the development that don’t make any sense at all and in terms of the work completed I would say this is the case too.


I will leave out the more technical aspects like flooding and the cliff that I have covered before and stick to something that most people should be able to grapple with, the roundabouts at each end of the site, I will even leave out the obvious issue of laying the blocks that form their surfaces on lose sand in an area subject to wave overtopping. 

These have both been built at considerable expense to the developer, so a reasonable question seems to be, what are they for?

At the pavilion end the roundabout is so big that it now has parking spaces all round it and even the largest vehicles don’t seem to have any difficulty turning with all the cars parked round it, at the other end of the site is another huge roundabout that seems to have been designed with the turning of juggernauts in mind, yet at the top of the access hill are signs saying no big vehicles.

Anyway while the council have been participating in the generating his new agreement I have been asking them some questions and after some time am getting their answers. This process started in the middle of April, you have to appreciate the council don’t answer questions quickly. 

I guess there are two aspects to asking these questions, one being, to try and find out what is going on and the other being to try and make officers think about some of the pitfalls that may lead us into further delays. 

So first of all I will try putting up the questions and answers in differed colours so it is easier to follow, mine in blue and the council’s in red.

Question 1 16.4.2012

1 Do you consider the changes in the plans since the initial application was granted to constitute material change? Examples would be the removal of the gull winged roof and the moving of the road from through the building to between the cliff and the building.

Answer from Corporate & Regulatory Services Manager 21.5.2012

1.This is a request for an opinion,  not a request for  information. You should refer this question to the Planners.

My Follow up questions/ comments 29.5.12

1 My understanding is that The Royal Sands was the responsibility of the major projects officer and when he left the council I wasn’t directed to another officer, could you please direct this question to the correct officer? Please further note that it is my understanding from discussion with the previous major projects officer that the council acted illegally in not requiring resubmission due to material change, which as the council’s solicitor may require your further opinion.    

Answer from Director of Operational Services 20.6.2012

1. Changes that are submitted in the future relating to the Royal Sands site will be assigned to a planning officer at that stage, but at present with no current outstanding variations there is not a specific officer dedicated to the site.

Any previous variations have been agreed and these are all published on the UKPlanning website. The treatment of these variations was in accordance with the requirements in place at that stage. Any further variations that are submitted will be processed using the current requirements.

Question 2 16.4.2012

2 Do you consider the sale of the site freehold to be  subject to the asset
disposal process and associated consultation process? I  understand it is the council’s intention that the leases be surrendered and the  development
agreement be revoked prior to the completion of a new development agreement and freehold land transfer.   

Answer from Corporate & Regulatory Services Manager 21.5.2012 

2. This is also a request for an opinion,  not a request for  information.  However my opinion is that the proposed  sale of the Council's reversionary freehold  interest of the Royal Sands development site is not subject to the Council's Asset Disposal process. 

My Follow up questions/ comments 29.5.12

2 When I discussed this issue with you, you assured me that the reason there was no need for this sale to go to asset disposal was that the eventual freehold sale was part of the existing and previous development agreement and variation. I have subsequently read both documents and can find no reference to any predetermined sale of the asset, could you kindly give me the details of where this information appears in either the development agreement, variation or leases?  

Answer from Director of Operational Services 20.6.2012

2. The provisions for the transfer of the asset lie within the Freehold Transfer Provisions under Schedule 4 of the current development agreement, and are referenced from clause 7 within the main agreement.

There was no question 3.

Question 4 16.4.2012

4 Do you consider it would be possible to obtain borrowing based on the security of residential building land or new build residential dwellings, on land that is designated as high risk flood zone by The Environment Agency? This is both in respect of the developer obtaining finance  using the freehold as security, in the immediate future and at the point when  prospective buyers attempt to obtain mortgages to buy apartments and the monies  obtained from the sale of apartments is required for further funding of the  development. 

Answer from Corporate & Regulatory Services Manager 21.5.2012 

4. This is another request for an opinion. In any event, as a lawyer I am not a competent person to answer this question.

My Follow up questions/ comments 29.5.12

4Obviously the whole viability of this project depends on how the forward funding functions, and I am concerned that the council may be intent on proceeding once again on a fundamentally unviable project. I am particularly concerned that you say you don’t know the answer to this question, the only inference I can draw from your answer is that you are happy to proceed with the project regardless of its viability. Can you please confirm that you are supporting this project without ensuring that the apartments will be mortgageable? 

Answer from Director of Operational Services 20.6.2012

The viability of the project is a key issue for the council as its completion is primarily dependant on funding from a significant third party to add to the £5 million already spent by the developer. The issue for third party funders has been the specific previsions of the current development agreement, but the practical viability of the project and its ability to provide a return for the external investment has does not seem to have been a significant issue.

From the council’s perspective the aim has been to try and reconcile the position of external funders, but do this in a way that does not compromise the original aims of the development agreement (different route same result). As such any change to the current development agreement will not take place without a clear commitment that an external lender will be funding the developer to complete the development, and this in turn is dependant on their due diligence processes about the achievability of the correct return on their lending. Clearly the key component of this is driven by the saleability of the residential units, but this element does not appear to be a problem given the amount of interest the units have already generated with the developer from prospective purchasers.

Question 5 16.4.2012

5 What provision do the council have in place both in terms of the monies they have received from SFP to date and the payment they would receive for the freehold, with respect to those monies being legitimately sourced particularly with regard to money laundering legislation? I note here that at the previous cabinet meeting to determine the development agreement 16th June 2009 agenda item 17, documents were produced showing the sources of legitimate funding at that time, Cardy Construction and Wetmore Investments. At the moment SFP Ventures UK Limited, have Total Current Liabilities of £1,982,199, Total Current Assets of £1,981,340, Cash at Bank of £4,656, which gives a negative net worth of £-859.


Answer from Corporate & Regulatory Services Manager 21.5.2012


5. We have already advised you that all funds received by the Council have been  received through a UK Clearing Bank so the Council is satsified that all such monies have been legitimately sourced.

Question 6 16.4.2012

6 With respect to the hotel, which would be in front of the part of the cliff facade investigated by the developer and reported as defective, what investigative work has the council undertaken and what associated documentation do the council hold, to prevent the developer using the facade condition and their associated report relating to this part of the facade, as a reason for being unable to construct the hotel. 


Answer from Corporate and Regulatory Services Manager 21.5.2012


6. You have asked this question on a number of previous occasions and I would confirm the replies previously given.

My Follow up questions/ comments 29.5.12

6 I think you may have missed my point here, which relates to the new heads of terms where the hotel no longer has to be constructed first. I have concerns that the developer failed to pursue or continue the survey they started on this part of the cliff, see Cardy’s cliff facing and condition report 19th March 2010, and am concerned that the developer could at the point of completing the apartments use this as an excuse not to build the hotel. So what have the council done to ensure this doesn’t happen? 


Answer from Director of Operational Services 20.6.2012



The issues raised by Cardy’s report dated 19th March 2010 was addressed through a subsequent site visit which included council officers and Jacobs Babtie. The council has covered all the issues in the report, and except for some minor issues that were dealt with there are no outstanding problems to resolve.

We keep all our significant structures under observation and undertake repairs and refurbishments where these are required. This wall is no different.

On this basis it is considered by the council that this matter was resolved in 2010 and cannot be used as a way to prevent the construction of the hotel.

Question 7 16.4.2012

7 Do the council hold any track record for SFP Ventures UK Limited, or their directors, showing that they have satisfactorily completed any substantial development? My investigations show that this company was formed in 2006, no accounting activity since that time suggests an active development company, the director has a number of other dormant UK companies with no positive net worth. My understanding is that SFP UK was formed after complaints were made that the council were dealing with an exclusively offshore Virgin Islands company.


Answer from Corporate and Regulatory Services Manager 21.5.2012


7.The Council hold no relevant information.


Question 8 16.4.2012



8 With respect to the current contractor, Cardy Construction, has the council received any recent letter of intention to proceed as main contractor, or a re affirmation to invest financially in the development? The site at the moment has the appearance of work stopping suddenly in the middle of the stage, which is constructing the support pillars for the transfer slab. There are partly completed pillars, open holes awaiting concrete and so on. The only inference I can draw from this is worked stopped with unpaid money owing


Answer from Corporate and Regulatory Services Manager 21.5.2012

8. The Council confirms that it holds relevant information which is subject to an obligation of confidentiality. The information is therefore withheld  pursuant to Section 41 of the Freedom of Information Act 2000. This is an absolute exemption so I am  not required  to apply a public interest test  in  making the decision to withhold the information.


Question 9 16.4.2012



9 Are you reasonably convinced that the council are covered properly in terms of both, duty of care, and viable insurance cover with respect to an incident involving failure of the cliff façade or sea defences? We have discussed the condition of both on several occasions, most recently the unfortunate combination of shallow foundations on sand and the 1860 sea defence that the council has no record of inspecting, maintenance or even holds plans for.


Answer from Corporate and Regulatory Services Manager 21.5.2012  



9. This is a further request for an opinion,  not a request for  information.  However my opinion is yes.

Question 9 16.4.2012


10 Has the council made any estimate of the ongoing costs related to maintaining both the sea defence and the cliff to a standard suitable to their proximity to a major residential development? I have tried to find a similar situation in the UK where a large modern residential development has been built between an unsupported chalk cliff and the foreshore, for comparison purposes and haven’t managed to. If the council have found anything similar it would be helpful. 

Answer from Corporate and Regulatory Services Manager 21.5.2012
       


10. The Council holds no relevanyt information.



That’s the end of the questions and answers for now, obviously some of the answers are fairly inadequate so there will be more questions.

An example of this may help, so I will try and chose one that isn’t in any way controversial, take the end of the last answer to question 4 “Clearly the key component of this is driven by the saleability of the residential units, but this element does not appear to be a problem given the amount of interest the units have already generated with the developer from prospective purchasers.”

With the number of reserved apartments going up and down and drifting around 15 out of 109, some could interpret this as the problem.


For me one of the most significant questions that I didn’t ask directly was, why when the officers were against continuing with this three years ago are they now recommending it to cabinet for approval?


I have hints at answers to this one, mostly relating to the developer possibly taking them to court to recover the £5m he says he has spent to date, if the council should decide to take the site back and either have a go with another developer, or just tarmack it over and use it for leisure and parking. 

I will complete this later as am having technical problems

51 comments:

  1. Gawd. It's like treading in custard.

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  2. Michael, I don't know about others but lately I've found your blog to be the only one where I have to scroll from left to right to read your posts. This makes it especially different when there's a lot to read as in this case. Just thought I'd mention it.

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    1. Have you just changed it? I can read things perfectly now! : )

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    2. Yes Peter, my fault I made it wider for a wide screen video and forgot to change it back.

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  3. Appalling by TDC: they hold no information on SFP at all! Presumably that makes it difficult to trace any bungs. And after 10 years there are no signed contracts and blueprints in the public domain?

    Point 8 is drivel: there is no absolute exemption to FOI. That's the whole point of transparency rather than coucnils and developers being secretive. Rather, a council etc can seek an exemption/censorship - but why would they? The public interest is of course paramount as it's public land and tax.

    Why aren't more of these officials sacked more often?

    Off-topic: was there a plane landing at Manston at 01:15am last night/this morning?

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  4. Not surprised by the plane landing at Manston, they've been doing that for nearly 100 years!

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  5. wake up 903 it was at 1am ie the airport closes at 11pm.

    Remember the banned EU aircraft eg Antonovs and Afghan and Iran Air - and missing monitors and complaints system and fines?

    Imagine how lax they would be with night flights?

    I suppose your foolish comment is right in that Infratil do as they like with spineless and deceitful councillors and civil servants.

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    1. 9:42, please remind me what you do for happiness apart from whingeing.

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  6. So, in a nutshell, the Council has agreed to sell the seafront to a developer which has no money. The Developer is now trying to get the Council to help them to borrow the money to finish the development. However, once they have the frehold in their grubby paws, who knows what will happen? Can anybody on the Council; anybody at all; explain why they considered a mysterious company, which is registered offshore and has no obvious track record and no discernible finances, to develop our seafront. Time for the Councillors who put their hands up to vote for this one, to take responsibility for their silly decision and fall on their swords.

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    1. 5.46 I can explain this one, back in 2002 when developing the site was first tendered, Whitbread the brewer tendered for the contract and SFP were Whitbread’s partners.

      The development was fairly ok, then Whitbread pulled out and SFP changed the plans to the bigger development that was higher than the cliff, this happened during the change of administrations at TDC from Labour to Conservative when councillors minds were distracted by the elections.

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    2. And Ramsgate Labour had their largest ever donation of £25k around the same time.

      The donor and reason seems to be a mystery. And the mystery fire cleared the site originally of course.

      Pleasurama should be cancelled immediately.

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  7. FROM ANONYMOUS 9.03PM - Thanks for the reminder Anonymous 9.42PM, but I did spot the time you mentioned. I'll have to take your word for it as I live right under the flight path but it didn't wake me. Perhaps, if you did something more than whinging about aircraft landing at airfields and making unsubstantiated accusations, you may sleep better yourself. Just a thought.

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    1. Well said, 6:29. My sentiments entirely.

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    2. So a plane landing 2 hours after the airport is closed is OK? You seem to have a strange grasp of how airports are regulated.

      And what exactly are the unsubstantiated accusations Anons?

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    3. TDC and the police do nothing about Manston...

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    4. Because TDC do not have the authority and planes landing out of scheduled times is not a criminal offence.

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    5. ANONYMOUS 9.03PMJune 28, 2012 9:07 am

      Can you substantiate your comment: "Infratil do as they like with spineless and deceitful councilors and civil servants". With regard to Infratil doing what they like with councilors I would suggest recent events prove this is not the case. I am particularly interested in your evidence to substantiate your accusation about "spineless and deceitful councilors and civil servants".

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    6. Yes 903: monitoring removed, failure to incur fines, Manston removing their complaints system, banned flights etc etc etc etc - where have you been?

      Interesting point though, do you think the councillors who've always expressed support for the airport, have regulated the airport effectively? Even now there's 1am flights that you seem to think are somehow OK.

      8:55 the S106 signed by TDC and Infratil regulates the airport so of course TDC have the authority - get real. Repeated landings at a closed airport would be a criminal offence (Kalair etc were banned remember) and certainly attract Police investigation or are you trying to suggest Infratil can do as they like?

      Nothing wrong with either of you wanting an airport like the old days but it's just not realistic is it - that's why it's bust again.

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    7. ANONYMOUS 9.03PMJune 29, 2012 11:20 am

      Anonymous 12:28PM, I've been here possibly a lot longer then you have and I've witnessed and experienced most developments at Manston since the 1940s. Unfortunately you have failed miserably to substantiate any of your comments relating to councilors or Infratil. All you have managed to do is repeat already well reported accusations. Might I suggest that if you have evidence rather than hot air, you are the person who is in a position to do something about it.

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  8. The dead zone around this site is widening and will have an adverse effect on the local economy. The developer should be run, they haven't made a meaningfull start and the few columns they have cast should be condemned as little/no provision has been made to protect against corrosion. The council should utilise this prime site for beach huts/dinghy park.

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  9. We always see on Thanet's blogs the argument that you cant complain about any flights from Manston if you have chosen to live under the flight path. Until new owners are in place and we know their intentions for the airport and when flights will take place, nobody in their right mind is going to fork out upwards of £275,000 for an apartment that is under the flight path. Likewise no hotel operator would spend £5 millions on the basis that its customers would do nothing but ask for their money back because of disturbed sleep.

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    1. Funny how Holiday Inn did just that on the old Prospect Inn site. Go to Heathrow or Gatwick, dimbo, and count the numbers of hotels and also check out the property prices in the neighbourhood. You whingers make it up as you go along.

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    2. Not only Holiday Inn but Premier Inn across the road and Travelodge at Ramsgate Harbour. But what do these international companies know about it when compared with the local whingers.

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    3. Hotels are for passengers - as at heathrow. Not for cargo as at manston.

      Are the Premier etc full and profitable? Don't know, doesn't seem to be. Why would you holiday in Westwood Cross or by the dual carriageway?

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    4. Modern double glazed, insulated buildings are well capable of dealing with aircraft noise. Pity the inhabitants in the listed Victorian buildings above. Michael does the new scheme extend higher than the Wellington crescent footpath?

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    5. What kind of beaches to thy have at Gatwick/Heathrow? Are they blue flag, soft sand family friendly? I dont think people living/staying by the beach would appreciate having to have their windows closed to cut out noise. The point about Pleasurama beach side living is that you choose it to have a relaxing time.
      Some say that you cant leave your windows open at night in Thanet but thats another reason to put off potential buyers when there is plenty of choice around if you are looking for a sea view apartment.

      Yes a bit of good insulation would help existing residents but there was nothing in the Infratil report to say they would pay for it.

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    6. Why don't you check out property prices around Gatwick and Heathrow. They are way above Thanet levels. Furthermore, when Manston was a busy jet fighter airfield our beaches, hotels and guest houses were packed. Did not seem to bother anyone then so please STFU!

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    7. Jack we are not living in the 50 or 60's anymore. People have a lot more choice, you may have noticed the arrival of the overseas package holiday.

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    8. Exactly my point so we need rather more than 'Kiss me Quick' hats to sustain local employment and good communications could be part of that. However, since you raised the package holiday, just check out how many are to destinations served by and close to an airport. Or maybe it is just Manston that frightens people away and all other airports are OK.

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    9. It's a cargo airport Jack. No passengers.

      And any passengers would be to places not in Kent: of little benefit to the local economy.

      Passenger flights into Manston? More noise and pollution. Visitors to Thanet come from London rather than flying in from Greece or Spain or Turkey for their hols.

      And passenger flights went bust: EUJet, KCCUSA, numerous tour operators etc.

      All bust.

      Just cargo and pollution and cancer.

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    10. Take a look at the Heathrow freight area around Poyle and then you'll understand the potential of freight to the local economy. The point is that Manston will not attract quality freight or passenger operators until it has the same flexibility as other airports.

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    11. 10 years of failure and one or two Cargolux flights a week (presumably these are to ensure the operating certificate) and 24 Infratil jobs hardly makes the airport economically important.

      It's also opposite Ostend freight airport...

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  10. Jack, Manston was an RAF base then and funded by tax. A private airport isn't -unless it's of a size like Heathrow which developed since 1946.

    Manston didn't and it's bust again. No jobs there: two dozen for Infratil? Barely more than a corner shop. And more polluting.

    Manston is bust. It's on the aquifer. Mired in TDC corruption. It's finished.

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    1. I was talking about aircraft activity not putting off visitors, not funding. If, as you maintain, Manston cannot be run profirably then you have absolutely nothing to worry about.

      Where is your evidence for TDC corruption or is that yet another figment of your imagination. Which councillors/officers are corrupt so we all know, but make sure you have the evidence to back it in court.

      As to the aquifer, since most of our water in the South comes from underground sources it follows that nearly everything is on an aquifer somewhere. Why single out Manston or is that just because it suits your argument.

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    2. This smacks of pro-airport desperation Jack. If it's so terrific why did it go bust yet again?

      You're right there's nothing to worry about except the continued pollution of an irrelevant, dangerous - and unmonitored airport that would have closed years ago.

      The corruption mentioned in the last post was for Lydd and detailed in the High Court.

      TDC corruption is a long-established pattern hence arrests, resignations, court cases etc etc.

      Most aquifers are not underneath something - so they can refill. Even you must agree having the drinking water under an airport is especially problematic. Like drinking from the toilet.

      Manston is bust Jack.

      If as you say it is viable - how?

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    3. I never said it was viable, but, if it is bust, it will close so why are you still getting your grots in such a twist. According to you, you've won so be happy.

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    4. Repeatedly you've been saying how Manston is viable, wonderful and nothing wrong with it at all. Quibbling every point and even quoting LHR and Gatwick property prices.

      Now you're saying you're not sure if it is viable? And don't care if it is bust or going bust - whatever. How pointless.

      Out of interest why are you so keen to ignore the aquifer problems, pollution breaches, 1am flights etc?

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    5. Not me, guv, you've got the wrong bloke. The only aquifer I'm interest in is one that turns water in whisky.

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  11. Im a DFL. The aircraft " noise" from Manston is so minor it's laughable compared to even leafier non flight path suburbs in the smoke.

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    1. You're right - although Infratil and Planestation were aiming for 30 night flights each night. The air pollution especially at low level may affect you more now.

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    2. this is horrifying how the councillors and officials and infratil have deliberately poisoned us

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  12. I have slept in Hotels at both LHR and LGW. Their soundproofing completely defeats aircraft noise. I have also slept in private accommodation at Hatton Cross which is to all intents and purposes part of LHR. The soundproofing worked perfectly. Though it was a different matter out in the garden [no, anonymous, you should not infer that I sometimes slept in the garden]. The residents that I met in Hatton Cross were strangely very proud and possessive of their airport.

    However, on reflection, I suspect that I am missing the point here because anonymous is complaining about night flights.

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    1. Since this post was about Pleasurama and not about night flights I think that potential purchasers would walk away if night flights were a possibility. The developers are asking top dollar for the apartments and you would not expect to buy one and then have to keep your windows shut rather than take in the sea air. Even day time sitting on the balconies would be too noisy for some. Most purchasers would get the vendor to confirm the Manston position in the pre contracts. To me it looks like TDC know that Pleasurama success and night flights are not both possible.

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    2. Fair point although two problems.

      1. Pleasurama has all sorts of different plans and non-plans: what exactly are the plans - except a retirement bung offshore for TDC councillors and civil servants? 25k to Labour obviously bought a lot of votes.

      2. Night flights - and monitoring - are all specified in the S106 for regulation. And ignored.

      Both Pleasurama and Manston should be closed down immediately and a fresh start begun. Even TDC know the cat's out of the bag: resignations, payoffs, arrests etc.

      McGonigal as Finance Director during this and now CEO is a disgrace.

      At the very least we need a TDC corruption ratecard: 1k for a civil servants? 5k for a councillor? Double for KCC? Triple for a road?

      JT

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  13. These apartments will have balconies overlooking the beach. Nobody in their right minds will pay top-dollar to sit on a balcony with filthy great freighters thundering overhead. I appreciate that the little team of petrol-heads who write in the paper will claim that they wouldn't mind, but they aren't in their right minds and they don't have any money, so could never afford one of the apartments. Time to reclaim the seafront for the people, methinks.

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    1. I'm buying one!

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    2. To anonymous, I am puzzled. If aircraft noise is such a polutant then how do you explain the consistently high and rising property prices in areas such as Richmond and Windsor? Granted that the expensive houses in Richmond may not have balconies. But then they have no need of them as they have enjoy gardens to sit in. Maybe the residents are noise masochists?

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  14. From reading these comments it is clear that anonymous is in dispute with anonymous however anonymous reminds anonymous that anonymous has directed the argument at the wrong anonymous and anonymous supports and does not support Manston and Pleasurama while all the time anonymous remains confused. Well, I say to anonymous that you are Lobby Lud and I claim my £5 reward and bring back Merrie England and if you do not understand the reference and sentiment then it is right that you remain anonymous.

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    1. Nice one, John, a very fair summing up of the assorted anonymous opinions.

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    2. Was that me you're talking about John?

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    3. No, I was talking about anonymous.

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