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.