Friday, 21 August 2015

An update on the Manston cpo.

When trying to tell where the council are going with their plans to try and buy the closed Manston Airport site to turn it into an air cargo hub and aircraft scrapping facility, there are no straight answers and for people like me who are Thanet council tax and business rates payers, it is a case of trying to read the signals that come from the main protagonists.

At the moment the situation is that the airport site has been bought by the people who own the largest local employer, Discovery Park at Sandwich http://www.discovery-park.co.uk they have plans to turn the site into a mixed light industrial and housing complex.

So what the council are proposing is to use money provided by an American property hedge fund management company RiverOak http://www.riveroakic.com/ to fund a compulsory purchase of the Manston Airport site to turn it into an air cargo hub and aircraft scrapping facility.

Both RiverOak and Discovery Park have websites detailing their plans http://www.riveroakinvestments.co.uk/ and http://www.stonehillpark.co.uk/ I supose the fundamental difference is that Discovery Park own the site and RiverOak don’t.

So I suppose the first question is; why would Thanet Council want to take the site away from a major local employer with plans to create local jobs and housing on the site?

I guess this happened when the airport closed and a lot of local people tried to get the council to do something to get it reopened, I would say that the local consensus is still for a regional airport. A problem here though with the various groups supporting the airport reopening is that they are now supporting an air cargo hub and aircraft scrapping facility and not a passenger airport.

Anyway the political part of government in this area, by this I mean the people we vote for as opposed to the local government employees, seem to right behind the council engaging in a compulsory purchase.

I guess in terms of risk though our local politicians would do very little in terms of carrying the can if the cpo goes wrong and for the most part they seem to be saying they intend to save the airport without making it clear that this saved airport won't be a passenger airport.

RiverOak the American hedge fund broker have set up a Delaware LLC to manage the cpo and channel investors funds into the project, which means investors can hide their identifies, click on the link http://beginnersinvest.about.com/od/holdingmethods/a/Delaware-LLCs-for-Beginners.htm or just google Delaware LLC, to see where I am coming from here.

I guess as RiverOak are a fund management company, perhaps the biggest question of them all is; whose funds are they going to use to finance a hugely expensive cpo?

It seems the answer to this one is; that they won’t even tell Thanet Council.

Here is the council’s latest statement:

Thanet District Council is currently reviewing its position around whether Riveroak is a suitable indemnity partner for a compulsory purchase order on the Manston Airport site.

This followed a Cabinet decision in July which committed to re-opening discussions with the American firm.

Following a final request for financial evidence promised by Riveroak, Thanet District Council’s solicitors have now reviewed the information submitted by the company on Friday 14 August.

An important part of this process is for the council to seek financial assurances from Riveroak given the significant financial risk of pursuing a CPO by a publicly-funded authority.

Two redacted letters were provided which do not identify the names or addresses of the investors who Riveroak suggest could provide the financial security required.

This approach to providing information in a redacted format is for a local authority, highly unusual and prevents it from being able to gather any financial assurance from it.

As a consequence the council has now asked for confirmation of the bond agreement as detailed in the draft indemnity agreement submitted by Riveroak.

Here is the link to the statement on the council’s website http://thanet.gov.uk/the-thanet-magazine/news-articles/2015/august-2015/manston-position-statement/  


                
I would say that if after a year of our local politicians pursuing a cpo by Thanet Council with a major inventor financing the cpo, the council don’t know the identity of the investor, then it is time to ask the council just how much money they have spent so far on pursuing this cpo.     

11 comments:

  1. Well done, Michael. Once again you clear way the cobwebs and present the bare facts. The leader of the current UKIP administration at TDC was privy to the information and legal advice their predecessors used to decide a CPO wasn't worth pursuing.
    Unfortunately his party was working all out to get Nigel Farage elected as MP for South Thanet. Farage used the Manston issue to harvest votes from pro-airport supporters. If anyone could have predicted that UKIP would end up running Thanet District Council and so becoming directly responsible for such a crackpot scheme, they wouldn't have been so rash.
    The idea of the local council taking legally purchased land from legitimate local businessmen with a proven track record and giving it to a shady American asset-stripping company is ludicrous. Unfortunately, the people who want their spitfire airfield back haven't the nous to see it.

    ReplyDelete
  2. If the identity of investors is to be kept secret my immediate thoughts are drug money and mafia types that would be embarrassing for TDC.

    ReplyDelete
  3. Good thinking as usual MIchael...but do the trio of Discovery Park bods actually own Manston as you imply?
    It was once reported that they 'bought it' with money loaned to them by Anne Gloag, the previous owner... and, I recall that Discovery Park is far from successful with only 50% occupancy and creates losses each year ... and that their PR person has a somewhat tarnished track record where they all come from up North.
    And do they 'own' Quinn Estates too ... the outfit that leaked housing development plans for Manston Airport and is now advertising office facilities to let at Discovery Park?
    Yes, River Oak seem shady too, but is Discovery Park any more transpaentr?

    ReplyDelete
  4. Hi Chuck. If I buy a house with money loaned to me by the building society, I am the owner of the house. Cartner and Musgrave own Manston but Ann Gloag has a financial interest. Maybe she loaned them money to buy it and will take a cut of the profits if they are successful? That strikes me as an astute business deal. By contrast, your chums in Riveroak continue to refuse to reveal who the financial backers are. Discovery Park is massively successful by the standards of most business parks. It has grown rapidly, attracted new companies and is employing substantial numbers of people. The only politicians who has visited the park and remains sceptical is Roger Gale. Everyone else is impressed. It's high time the negative sniping stopped. Thanet needs all of the jobs it can get and Discovery Park is more successful than any other initiative the area has ever seen. Cartner and Musgrave don't own Quinn Estates. That company is owned by Mr. Quinn. If you're into conspiracies, look on their web-site. They seem to be located just round the corner from Dr. Webber's house.

    ReplyDelete
  5. Manston claims its first TDC cabinet member sacking after 3 months!

    in a statement on Cllr Helen Smith, council leader Chris Wells said:

    “It is with considerable regret that I have today decided that Cllr Helen Smith can no longer continue as a cabinet member for the present. Helen possesses many of the skills and abilities cabinet members require, but has struggled to separate her new responsibilities from her campaigning interests regarding Manston Airport.”

    ReplyDelete
  6. For an elected councill that should represent the population why are they pressing on with plans to put a freight airport on the edge of a heavily populated area without the views of those who will have to suffer the consequences and disruption to their lives,I can assure Chris Wells that he has grossly underestimated the strengh of feeling against what are his parties plans only and not the people's,there will be nothing but trouble and unrest if this CPO goes through.
    Stargazer

    ReplyDelete
  7. MB I guess UKIP expected to be one of the larger parts of a no overall majority.

    Don I guess this combined with RiverOak’s managing director being a solicitor who was struck off for misappropriating clients funds does raise concerns.

    Chuck I guess how DP use the grant funding and how they finance their business isn’t the issue, the fact is that they are now running the operation which is the largest local employer and their employees spend their money in Thanet. RiverOak on the other hand don’t seem to have any verifiable record of employing anyone anywhere, don’t seem to have left any internet or media trail of doing anything apart from spending their client’s funds on minor real estate investments.

    I guess the thing about Discovery Park that does stand out is that they don’t appear shady at all, provided that is, you can read a company balance sheet.

    Dave I guess the issue with TDC councillors is that they have very little power and have very little liability for what goes wrong. The notion of power without responsibility is always a fiction, it is the senior officers who risk their careers and so it they who increasingly make the decisions.

    Stargazer the first stage of the cpo should have been public consultation. Do you want a passenger airport? Do you want a freight airport? Do you want light industry and housing? Not save the airport = freight hub you can’t fly from.

    ReplyDelete
  8. I have copied below a letter from the Leader of TDC which is doing the rounds on FaceBook

    Dear John
    I have summarised the position in both my Leaders column in the Gazette yesterday, and statements on the TDC website.
    The problem we have throughout this process is separating fact from fiction, and hard decision from belief. My Leaders column in the paper summarised the issues, particularly the risk in making decisions against legal advice. You can take it from that the campaigners belief in the absolute authority of Riveroak's legal opinions is not reflected in our own legal advice. Indeed it is interesting to note that in a PR issue summarising CPO issues last week there were clear errors in the legal position in at least one answer. Additionally Riveroak have no in house expertise in CPO either, there's, as is ours, is bought in under instruction to lawyers and consultants.
    We are committed to moving the CPO forward, have achieved more than the previous administration in doing so, who frequently stated they wanted some money in a UK bank account which we have now got, but have been delayed over the summer by Riveroak's delay and then failure to produce information they promised, NOT something we demanded. We only issued a final request after a five week delay in providing the information, which arrived in a different form than was promised. This request was discussed fully by Cabinet before it was issued, and Cabinet discussed this subject again last Thursday. We have asked for external formal review of the value of the redacted letters, which you will understand is a highly unusual form of financial information for a local authority to assess.
    We have asked to bring the basic bond information forward in light of the other information that has been sent. This is in line with the PWC report suggestion we should try a range of options to discharge our responsibilities. Given this is an integral part of Riveroak's own proposed indemnity agreement, a simple response about the range of institutions considered, likely sums of both bond and cost, which needed to be confirmed later, would have done. That is not the response we got.
    Riveroak executives may have been in the UK over the summer, it was on their own initiative, not in discussion with us, and no meeting had been promised. We were awaiting the financial information requested over most of this time.
    I believe I have addresses the issues honestly and fully. I will not respond directly to your other accusations. I suspect it is your passion that makes you use such confrontational language, and I respect that passion.
    Regards
    Chris Wells

    ReplyDelete
  9. It is good that Chris Wells now admits that the legal advice received by TDC shows that it is not going to be easy the proceed with a CPO. Why, then, did he and his UKIP chums pledge to go ahead with the CPO as soon as they were elected? If they hadn't read the paperwork, why were they making promises which they couldn't possibly keep? A cynic might say that they didn't expect to end up running the council.

    ReplyDelete
  10. Roger Gale has continually referred to strong support and pledges from central Government for Manston and its return to life as some sort of airport. What support has been provided? Where have Ministers intervened? What tangible results can Gale show for all his intemperate protests and promises?

    ReplyDelete
  11. Well they certainly had a hand in making it a temporary Lorry park for the next 9 months thereby giving the legal owners time to get their plans sorted out

    ReplyDelete

Please note comments that may be libellous, comments that may be construed as offensive, anonymous derogatory comments about real people, comments baiting internet trolls, comments saying that an anonymous comment was made by a named real person, boring comments and spam comments, comments in CAPs will be deleted. Playground stuff like calling real people by their time stamp or surname alone, referring to groups as gangs, old duffers and so on will result in deletion. Comment that may be construed as offensive to minority groups is not allowed here either, so think before you write it, remember that the internet is a public place, that it is very difficult to be truly anonymous and that everyone who uses it leaves a trail of some sort. Also note the facility to leave anonymous comment will be turned of during periods when I am unable to monitor comment, this will not affect people commenting who are signed on to their blogger accounts. When things are particularly difficult on the commercial spam front I may turn comment moderation on for periods.

If you feel that someone has left a comment that is offensive and directed at you personally please email me (link on the sidebar) asking to have it removed, you will need to tell which post and the date and timestamp of the offending comment. Please do not reply to the offending comment as I will assume you continuing the dialogue as meaning that you want the comments left there.