Wednesday, 5 December 2012

Royal Sands Development on the Pleasurama Site in Ramsgate, the Labour Position from the Poolside.



I have been cracking on at the senior members of the Labour group, two of the cabinet members are also my ward councillors, with Pleasurama in the same ward, but I didn’t even get an answer from them.

The main man Alan Pool in this instance has been away on holiday in the antipodes and although jetlagged hasn’t been caught singing the non politically correct verse (Let me Abos go loose: They're of no further use, Bruce) so it would appear he will be there whipping a Labour vote to flog the Pleasurama saga at full council tomorrow.

Here is what he has to say:


   Hi Michael,

Cllr Driver is electioneering; he is merely 'band wagon jumping'......the KCC elections are in May!

I appreciate the Pleasurama saga has been rumbling on for more years then I care to remember......there are far too many nutty conspiracy theories surrounding this project!

Currently we have a lease in place that is valid until 2017 and we cannot unilaterally change it.
It is very unlikely that the developers will be able to raise the required finance in the current economic climate with the current agreement. They have already invested a considerable amount of money in the development.

If we do nothing the site will remain an empty mess until at least 2017.
In all probability we will need to take expensive legal action to get the site back and it is by no means certain that we will get the site back.
If we do manage to get the site back we will then need to find a new developer.... and they are not exactly queuing up at our door.
In all probability we will also need a new planning application (with flood risk assessment etc). The whole process could take many more years!

From where I'm standing I believe the best option for Ramsgate is to get the site developed ASAP and if we can do that by 'tweaking' the current agreement, so that it is easier for the developer to raise the necessary finance, then that's what we will do.
We have built in a number of legal safeguards to protect our interests but nothing is risk free.
We will not sign a new agreement until we are fully satisfied that the necessary finance and hotel operator are in place.

I think this is the best opportunity that we are likely to have to get this vital regeneration project completed in the foreseeable future.

My understanding is that we are now very close to completion..........

The two 'Motions to Council' (Full Council 6th December) are merely spoiling tactics by publicity seeking individuals.........

Alan

(You are free to publish the above)



My take on this development for years has been that at the very least it should be safe and regardless of my concerns about cliff safety, which can be rejected or accepted by anyone who has read my posts about it.



The flood risk is a different ball game because the developer and council have chosen to ignore the Environment Agency’s strong recommendations and it should be addressed.



This isn’t because there is no problem but because of a loophole in the rules that the developer and council are using, here is the link the EA’s letter for anyone who doubts what I am saying here http://michaelsbookshop.com/ea/   



Because of this letter the development would start out with a blight on it, making it more difficult to insure and at every stage, from development loans to individual apartment owners mortgages, more difficult to secure money againt.



Of course there are plenty of existing properties on high risk flood zones, but new builds on one without a flood risk assessment just don’t exist, because one is mandatory and no one else has the loophole.

I am very conscious of once again being where I was with the Conservative administration three years ago, where the now Labour administration has the opportunity of getting us out of this ten year mess, but for some reason of their own probably won’t.

Perhaps there was a donation made to either or both parties at some time, with a tangle of different offshore companies this would be difficult to find out as it could have come from anywhere.

I think in this case it is the hope of raising some short term funding rather than any real hope that a reasonable development will be built, may be a factor.

If they were sincere in wanting to benefit Ramsgate they would have insisted on a flood risk assessment as part of the deal as part of granting the developer the concessions he asked for.

I would say a reasonable approach towards public safety is a minimum requirement to being seen as a positive administration.
  

Now however the emphasis has moved to the financial side of the deal, with Cllr Driver’s comments and the motions by him and the conservative group.



I guess if I put my legal hat on here I will encounter considerable adverse comment, but here are some thoughts.



Starting with Ian Driver’s questions relating to banking l



Banks letters genuine or otherwise may not significant enough in the decision making process to invalidate the agreement amended 2009.

The council decision was do they take the £1m deposit instead of the performance bond, not did the developer have the funds to complete.

The officers wouldn’t have necessarily have checked the documentation as they had recommended to the then Conservative cabinet to reject taking the deposit instead of the bond and direct the officers to terminate the development agreement.  

The decision to go on with the reduced guarantee and produce an amended development agreement delaying the finishing date to 2017 was that of the Conservative cabinet.

It did go to full council with a Conservative working majority for final decision, but this was for forms sake, the Conservative councillors wouldn’t have rejected it, whatever they thought, as it would have been a show of no confidence in their leadership.

The Conservative cabinet then Ezekiel, leader, Kirby, Latchford, Tomlinson, Wiltshire, Wise and Moores, could I guess say they had been mislead. Perhaps the existing conservative Cabinet now Bayford, Bruce, Moores, xxxx, Wells and Wise could say they were mislead. 



What happens if council just grab the land back now.



Even if SFP didn’t take the council to court, Cardys who invested money in it probably would, use the courts to try and recover what they have spent.



My guess is the most expensive part of the work since Cardys involvement was the subcontracted surface drain. You may remember I tried to get the subcontractor to go around the underground toilets instead they tried to go though them, this must have been expensive. You may also remember I tried to get them to avoid the old sewage flushing sluice and instead they dug it up to see what happened, before using a different approach, this must have been expensive too.



I don’t know who paid the bill, if it was Cardys I would guess this would be in the order £700k, I don’t think 9 months of larking about afterward with three men and a digger can have cost all that much.

One way or another though I guess about £1m is involved here and as the council has already spent £1m on the cliff and is just about to spend some more on it, things could clock up.      
 

Ian Driver has had a response to his email to the chief executive.



Here is the correspondence thread going on from the ones published at http://thanetonline.blogspot.co.uk/2012/11/royal-sands-development-on-pleasurama_27.html



Dear Ms McGonigal

Further to my e-mails to you of 27 and 28 November, I wondered if you are now in a position to advise me whether the documents included in the confidential Pleasurama Report to Cabinet  of 16 June 2009, were ever checked for authenticity and if not what steps will now be taken to carry out these checks especially in light of the concerns I have expressed to you.

I did request in my e-mail of 27 November that I be provided with a copy of this report and am surprised that I have not received it yet.

I feel that I must point out that I am becoming increasingly concerned that my e-mails to you are never acknowledged and that I must spend time chasing you for replies.

I am sure you will agree this is not an acceptable situation for an elected member and chairman of a major panel to be placed in, particularly when the issues I am raising have a considerable public interest element.

I look forward to hearing from you.

Yours sincerely

Ian Driver

Chairman OSP



Sent: Wednesday, 5 December 2012, 15:47
Subject: RE: Pleasurama



Dear Cllr Driver,

Firstly may I apologise that your emails have not been acknowledged. With the volume of emails that I receive I do not routinely acknowledge every email, particularly those from officers or Members of the Council, as I ordinarily endeavour to reply within reasonable timescales. On this occasion, I felt I was still within a reasonable timeframe, given that only 5 working days had elapsed between your first request and your email below, and given that I have had to recover old files in order to be able to provide the requested confirmation. However, I will ask my PA to acknowledge your correspondence in future.

Turning to your actual request - I can confirm that checks were made in respect of the documents and the claims within the documents which were included in the Cabinet report of 16 June 2009, and that these were deemed to be satisfactory in the light of the decision that was being taken at that time, and the associated risks of such decision.  I would like to point out that the report set out clearly that the supporting evidence attached to the report "show how the project is being funded, but they do not prove funding" and that the question for Members was "whether to proceed with the Development Agreement on the basis that there is evidence to support, though not absolute proof, funding is in place"; which of course, Members decided was sufficient to proceed with the new development agreement.

I will again ask that you be provided with the full Cabinet report.

Thank you for your suggestion regarding future due diligence in your email of 28 November, I have noted this and will factor it in to our verification process associated with the revised agreement.

Regards,

Sue

Dear Ms McGonigal


Thank you for your reply to my e-mails.


I am pleased to note that checks were made "in respect of the documents and the claims within the documents ... and that these were deemed to be satisfactory".


However my e-mails to you actually requested specific information about the nature of the checks which were made namely -


1. "if checks have ever been made with Nat West bank to ascertain if the letter on page 18 of the report is genuine"
2. "if checks have ever been made with SBP Bank to ascertain if the letters on pages 17 and 21 of the report are genuine
3. what checks were were made to establish the bona-fides of Wetmore Investments in 2009 

I would be very grateful if you could provide me with answers to these questions

Yours sincerely

Councillor Ian Driver
Chair OSP


My own feelings here are that there is something wrong that goes back to 2002 under the Labour administration when the initial proposal Whitbread and SFP said that the funding was to come from a Swiss bank at a time when the Swiss bank didn’t have a banking licence.

Here is the document that says this http://www.michaelsbookshop.com/blogpicts10/id5.htm it is a public domain document and it states this clearly.

“SFP Bank will be funding the project overall through SFP Ventures Partners Ltd”

At this time Société Financière Privée S.A. (SFP) had a licence as a stockbroker it later changed its name to Société Bancaire Privée S.A. (SBP), it was granted a banking license from the Swiss Federal Banking Commission (SFBC) on January 22, 2003, in addition to the securities trading license it received in 1999. SBP was listed on the SWX Swiss Exchange. Société Bancaire Privée (SBP), became Banque Profil de Gestion (BPDG) in 2009, there is a fairly bumpy history of licensing.

I should point out here that SFP Ventures Partners Ltd turned out not to be part of Société Financière Privée S.A. (SFP) but a Virgin Islands Company, at this time Virgin Islands Companies were blacklisted in many financial circles due to their connections with money laundering.    

My feelings are that the problems began when the council decided on a project funded by a bank, with out checking that the bank was in fact a bank and therefore in a position to fund an overseas development.   
 


I have asked various people I know who are involved in property transactions what they think the site is worth as a development site.

Answers are varied and between £10m and £20 the higher figure relates to its worth with planning permission and the council being responsible for the cliff maintenance and sea defence maintenance, which is the case at the moment.

The difficulties with this are that no well known developer would be likely to proceed without a flood risk assessment and the consensus here is that this would be likely to make the base line about a metre higher.

The type of developer who would be prepared to proceed without one, would be unlikely to get a development loan, for a new build on a high risk flood zone without a flood risk assessment.

The lower end assumes starting from scratch and some responsibility for the cliff management, the consensus being that funding for the sea defence would come out of the national flood defence budget.  

Finally I should point out that I have been fairly restrained in publishing supporting documentation, however if either Labour or conservative councillors feel that there is an imbalance between error in favour of one party or another I have some room to redress it.   
    

40 comments:

  1. This comment has been removed by the author.

    ReplyDelete
  2. I guess I'm a 'publicity seeking individual' then but if it hadn't been for me for me asking some very difficult questions of Cabinet and The Chief Executive excluded, Cllr Poole would have focused his laser-like attention on the project and it would have been done and dusted by now!

    PS I deleted the earlier comment because of typing errors. Easier on the PC than the iPad

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    Replies
    1. Simon, your constant self-promotion makes Ian Driver look shy and retiring!

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    2. Peter,

      Let's be fair about this. Politicians have always gone in for self promotion. The whole election process is about self promotion. There is nothing wrong in this. It is just the way of things. What's that old American saying, "He who whispers down the well about the goods he has to sell/ will not make as many dollars as he who climbs a tree and hollers."

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    3. I am afraid that the letter from cllr Poole does not show him in good light either in the way that he insults those that question whether the developer has hoodwinkled the council. What he needed to do was give reasoned assurances that the council had carried out due diligence on the developer. He only had to ask the chief exec and not call those that question it, "nut cases", what if they are right? Then it is him who will look a right Charlie.

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    4. Simon I don't quite follow "The Chief Executive excluded" did you mean included?

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  3. You might not like Ian Driver but you have to admire the guy for trying to extract a straight answer to a straight question. For as long as I can remember, councillors have not done this. They've just accepted bland unspecific reassurances. If Poole wanted to gain some real credibility he'd join in with a few questions of his own. However, we have to bear in mind that both Labour and Conservative administrations were involved in creating this fiasco. Sometimes you don't want to ask awkward questions if it would cause difficulties for one of your own.

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  4. Michael,

    Surely this is extremely dangerous for the Council, (us). If Labour now ignore all the concerns and sell the freehold in the full knowledge that the Council's cliff face could collapse on top of a the new development, and that the site will flood (as confirmed by the EA), there will be a continuing liability if god forbid, either the cliff collapsed or if when the site floods, someone gets hurt. From what you have identified correctly in my view, the potential for blood on their hands seems almost a certainty.

    I can't see how Cardy's could sue the Council if Labour foreclosed on the lease for legitimate reasons. There shouldn't be any contract between the Council and Cardy's and Cardy's have surely been paid for what they have done anyway. Have you seen the Lease?

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    Replies
    1. Cardys have an investment commitment if £1.5m, SFP said in 2009 they were entering into a Venture Partnership with Cardy Construction, Cardys called it an investment commitment.

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  5. Who on earth is advising this Labour Cabinet of little Hitlers who know so much better than the rest of the Council. Same person who advised them to stop the animal exports and got that wrong probably. How much are they costing us.

    I can see Cllr Driver joining the conservatives next!!

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  6. I should point out that the above comments were made before I finished writing the post.

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  7. If the site as it stands is indeed worth £20 million then there is little wonder that the developer is keen to get his hands on the freehold. He could then sit on the land until prices improve when he would sell it on to another developer at a profit. The taxpayers have been poorly served by TDC throughout.

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    Replies
    1. Correct me if I am wrong anybody, but I thought it was possible to put a clause on a freehold to the effect that any subsequent profit made from a re-sale of any land/property is shared with the original owner?

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    2. This would be the sensible thing for TDC to do. Could TDC still retain control over what was built, in which order and when?

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    3. 2.56 I think the problem here is that the council would have had to have written the development agreement and leases differently, the are published at http://michaelsbookshop.com/pda

      For some reason the site didn’t go through the asset disposal process and the disposal documents and subsequent variation appear to favour the developer more I expected.

      John I think the problem may be summarised as the council are running out of sensible opportunities on this one.

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    4. Michael,

      About the lease and the asset disposal process: Is this just a case of monumental incompetence on the part of some Councillors and their Officers?

      A person close to the developer told me that all was well, that the flats would be built and that I should expect an annoucment soon.

      Delete
    5. Michael,

      Your 5:55PM, Final paragraph.

      The Counsellors responsibiblle could always flee, by charter aircraft from Manston, but not at night.

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    6. John my understanding is that the developer is fundamentally an offshore company with the directors and therefore who actually forms the company concealed.

      A UK company was formed when complaints were made about this, but the UK company has seen very little activity and had a negative net worth.

      SFP UK appears to be two individuals who have never developed anything, so I don’t see how they could know.

      So I guess it depends on who or what you mean by the developer.

      At the moment the development starting depends on the due diligence, i.e showing the £22m is there to finance it, I don’t think saying it is a Swiss bank account will suffice.

      Delete
    7. Michael,

      The person I spoke to knows.

      What I mean by developer is the person who is financing the project and will profit from the building and sale of these flats. SFP may appear slippery, but they must exist not least because they are presently negotiating with TDC over the freehold.

      Delete
  8. John, since there are experienced Thanet Councillors contributing to this discussion, I guess they could have a go at answering your question?

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    Replies
    1. Anon 5:01,

      That would be good; but I rather doubt that any of will.

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    2. My above should read: .........but I rather doubt that any of them will.

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    3. My guess here is that both political groups locally have operated on – keep your head down and watch anyone who doesn’t get shot down principle – for years.

      A difficulty here is that while they have done so, the rest of the country are moving – kicking and screaming maybe – to a much more transparent and open government.

      We have a situation at the moment where Cllr Driver is just behaving in the way one expect a councillor to behave, rumblings are starting about will he stand for Kent County Council, and if he does so will he win?

      But on the whole at the moment I think most councillors are terrified of the internet and saying what they think.

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    4. Michael,

      I do not give a toss about Driver's political ambitions.

      There are Counsellors and Officers on TDC who know the truth. Omerta will not survive much longer.

      Delete
    5. Michael,

      SFP, whether in BVI or on the moon, intend to get their hands on the freehold. Having done this they will be home and dry and in control. My fear is that TDC will be so reckless as to give it to him.

      I think we should put aside for the moment who owns SFO, Swiss banks and the lack of other developments. Someone in TDC is speaking to someone in SFP. I would like to know who they are so they may be questioned. They have names. Can someone out there name them?

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    6. The Uk directorships are listed at companies house thus:

      DIRECTORSHIPS SHOWING ALL DIRECTORSHIPS
      NAME & FUNCTION STATUS PORTFOLIO

      Mr Shaun Patrick Keegan (born 66 years ago)
      Director, Financial Advisor
      19 Sep 2007 — Present (5 years, 2 months, 17 days)
      Open
      Open7
      Retired4
      Closed3

      Miss Natalie Wood (born 23 years ago)
      Director, Student
      25 Jul 2012 — Present (4 months, 12 days)
      Open
      Open1
      Retired0
      Closed0

      Ms Jennifer Wood (born 44 years ago)
      Company Secretary, Secretary
      01 May 2006 — 10 Oct 2009 (3 years, 5 months, 9 days)
      Retired
      Open0
      Retired2
      Closed1

      Mr Robert John Murrill (born 70 years ago)
      Director
      04 Jul 2006 — 10 Oct 2009 (3 years, 3 months, 6 days)
      Retired
      Open0
      Retired1
      Closed0

      Mr Shaun Patrick Keegan (born 66 years ago)
      Director, Director
      01 May 2006 — 04 Jul 2006 (2 months, 3 days)
      Retired
      Open7
      Retired4
      Closed3

      Mr Anthony Albert Hollis (born 73 years ago)
      Director, Accountant
      05 Jan 2006 — 02 May 2006 (3 months, 28 days)
      Retired
      Open16
      Retired56
      Closed24

      Mr John Richard Holliday (born 62 years ago)
      Company Secretary
      05 Jan 2006 — 02 May 2006 (3 months, 28 days)
      Retired
      Open6
      Retired17
      Closed8

      Swift Incorporations Limited
      Company Secretary
      05 Jan 2006 — 05 Jan 2006 (1 day)
      Retired
      Open19
      Retired263482
      Closed2564

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    7. Michael,

      I get your point. But forget a list of Directors, etc gathered from the Internet. This is just a red herring. Someone in TDC is negotiating with someone in SFP. They know each other, know how to contact each other and will have met face to face. Can anyone out there name these protagonists?



      Delete
    8. John, yes I agree with you to the extent that TDC and potential Royal Sands purchasers are able to contact representatives of SFP, but this doesn’t tell anyone much.

      SFP are called developers, however they seem to lack the fundamental qualification for this, having ever developed anything, I am called a bookseller, the primary qualification here is that I sell people books.

      Delete
    9. Michael,

      Set aside the developers qualifications. TDC is actively negotiating the freehold. This is about decision makers. There are parties in SFP (or call them what you will) and TDC with the authority to reach an agreement and to sign legally binding documents, and to lose us the freehold. And they are talking to each other. Does anyone out there know their names?

      People have organised public meetings and protests about saying No to Manston; but no one seems to care that deeply about 'Pleasurama'.

      Delete
  9. Why do so many people confuse councillors with counsellors? I don't think any of the latter work at TDC, though no doubt many councillors could do with their help!

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    Replies
    1. Peter,

      I blame it on the spell checker.

      Delete
  10. I think you are right to mention Cardys because that would complicate TDC trying to rescind the contract on grounds of misrepresentation.

    Anyone can write a "Draft letter" ... it doesn't mean anything until signed by the party to whom it is submitted. Solicitors write draft orders of the court all the time. They only actually become a court order when the court stamps them on the nod of a judge.

    Looks like TDC is outa pocket and headed to having its fingers burnt as they hand over the freehold for peanuts ?

    ReplyDelete
    Replies
    1. 7:06,

      Draft letters are often used as a tool for negotiation.

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    2. Yes initially between the developer and his bank. The suspicion here is that the draft letter may be a false instrument.

      Delete
    3. Anon 9:14,

      That it may be a false instrument does not surprise me. The perpetrators may soon have to face the music. (Sorry, couldn't resist that last bit).

      Delete
    4. nice one. Further reason to suspect an orchestrated fraud.

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    5. The council should be striving for harmony.

      Delete
  11. Also operating without a company secretary for a company formed before 2006 depends on either the original articles of assn or the submission of revised articles ? Maybe another one for the Chief Executive to clarify ?

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  12. We have all seen the piece on BBC TV about the infsantile antics of some TDC councillors. The media have discovered TDC and I'm sure they will be on the lookout for more juicy items. It cannot be long before they discover Pleasurama. Let us hope they do so before TDC part with the freehold.

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  13. I hope they latch on to the Sericol contamination of aquifer. As I understand it an anonymous letter was received by a Labour Cllr many years ago. It was about red staining of the chalk at the Poorhole Lane site and suggested this was due to solvent leakage.

    The Labour cllr was apparently told that a leak had recently been discovered luckily before it reached aquifer.

    It was years later that Richard Card did FOI applications to Environment Agency and the truth about the huge Sericol and Thor aquifer contaminations thus reached public domain.

    The red staining was in fact a product of the remediation process kept secret for many years from Labour cllrs and the public.

    The discovery of the leakage of cyclohexonone to aquifer for 30 years was made about 1992. Rumsfield was switched off immediately (A bit late eh) But what about letters of concern that were posted to TDC ? A tory cllr was cautioned in front of Chief Executive by Cllr Margaret Mortlock. He was running a mail intercept at TDC through helpful TDC officers.

    The BBC would be on safer ground here then in naming Lord McAlpine.

    Which tory cllrs tried to sustain TDC funding of Thanet's very own little uniformed youth gruppen?

    Michael is to be commended for his sustained public interest campaign re Pleasurama.



    ReplyDelete

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