Council urge Crest Homes to accept Rugby Club offer for Grounds

Crest Homes has defended its decision to take back possession of land currently used by Harrogate Rugby Club at the start of next month.

The move would leave the club without a ground and has led to Crest being criticised for its lack of support for the sports facility.

However, Stephen Stone, Chief Executive of Crest Homes, said accusations that his company was unsupportive of the Club and its future prosperity were “unfounded”.

“I feel it essential to reiterate that we have long strived to reach a compromise, which includes sporting provision, which is acceptable to all parties,” he said in a statement.

“We are still extremely open to finding a way forward with Harrogate Borough Council who has the power to resolve the situation with a local solution. It is undeniably frustrating that the Council has not supported any of Crest Nicholson’s (or indeed the Club’s) proposals during the last 11 years and we remain unclear as to why our requests have been rejected.”

Mr Stone said the club concluded more than 12 years ago that the ground was in need of substantial expenditure and that the facilities were falling into disrepair and were not fit for purpose given its aspirations to maintain its league status.

“At that time, with the active support of the Council, Crest was selected by the Club to become a residential development partner for the site.

“Crest paid £610,000 up front for the land, on the basis that as and when planning consent for residential development on the site was granted, all of the resulting land value, estimated at around £7 million would be paid to the Club to allow it to purchase, develop and maintain a new alternative facility in the Harrogate area.

“The Club had the use of Crest’s payment interest fee, for up to 10 years, during which it was to find an alternative site, and Crest was to achieve a residential consent on Claro Road.

“During this period Crest has spent well over £900,000 in fulfilling its obligations and would have been granted consent was it not for the failure of the Club’s proposals for the Killinghall Site.

“Since then, although the Club has searched for alternative sites, all efforts to find a compromise solution have been continually hampered by the Council. The reality is that Crest should have taken possession of the site in 2009 but in order to help the Club we delayed this action and allowed it to remain on site completely rent free for the whole of the 2009/10 season,” he continued.

Mr Stone said that in 2010 the Club and Crest met with the Council again to ask it to engage positively to find a compromise.

“Disappointingly the Council dismissed our joint approaches, claiming that it did not fit in with their plans. Therefore it was with reluctance that we concluded that in the interests of all parties, particularly the Club members, the only sensible way forward was to call for possession now (at the end of the season) in order that we can prompt action and secure a sustainable future for the site.

“Crest has on several occasions agreed to sell its interest to the Club for £1.2 million. On the fair understanding that if, in future years, the Club were to decide to sell the site for residential use the resulting uplift in value would be split to allow Crest to recover some of its losses. In recognition of the difficulty the Club was having in raising funds Crest agreed to consider an option structure. This would allow the Club to stay on under lease for up to five years on payment of an annual rent, whilst both parties considered alternative strategies for planning, with the aim of securing a long term legacy for the Club and allowing Crest some chance of getting back some of its historic expenditure.

“Understandably this approach was dependent upon agreeing various changes to the current arrangements, under which the value of any residential consent obtained by Crest is shared with the Club, so that Crest could justify the additional expenditure needed in the face of continued Council opposition. We asked the Club to support this approach and to raise the overage threshold to reflect our continued expenditure. Unfortunately the Club refused. Again the Club agreed to pay £1.2m for Crest’s interest, however when the formal offer was received, it was for £143K less than the agreed amount, with no offer of additional funds in future. This lack of compromise by the Club in addition to the Council objections has made it extremely difficult for Crest to provide a workable financial solution other than taking up its legal entitlement to taking full possession of the site.

“It is important to emphasise that Crest will not make any profit from a sale to the Club, indeed quite the contrary,” claimed Mr Stone.

“For over 10 years we have worked tirelessly to either help the Club find a long term solution or to walk away for a payment which recovers only a proportion of the £1.5 million of costs that we have incurred as the Club’s formal development partner.

“I reiterate that we are wholeheartedly receptive to finding a solution, in conjunction with the Council, which will secure the future of the Club and the land, but that solution must be viable for all parties. With the government’s new localism agenda putting more power into the hands of the local community I am urging supporters of the Club to work together in asking the Club Committee Directors to arrange a meeting with the Leader of Harrogate Council, which I am happy to attend, with the aim of agreeing a practical solution.”

Harrogate Borough Council has refuted Mr Stone’s allegations that it is the council rather than Crest Nicholson, that is responsible for the current threat hanging over Harrogate Rugby Club.

A spokesperson for the council said: “The club’s future is in doubt as a result of Crest’s decision to issue a notice requiring the rugby club to quit the Claro Road ground by 1 June 2011 – despite the club having been granted a five year lease as recently as August 2010. Crest have issued the notice despite there being no agreed follow on use for the site, no valid planning permission and thus no prospect of immediate re-development.

“The background to the eviction is a 1999 agreement under which the club negotiated the sale of the ground to Crest Nicholson in an attempt to extricate itself from accumulated debts built up over a number of years. That agreement was predicated on the belief that housing land values could be realised at Claro Road.”

Councillor Don Mackenzie, Leader (Designate) of Harrogate Borough Council, said Claro Road had been identified by the council for possible housing development in the former Local Plan, but its release was always subject to the successful relocation of the rugby club.

He said: “Despite every effort, no suitable relocation site has been secured. Such sites as have been proposed have been rejected on grounds of landscape impact or unsustainability of the chosen location.

“In each case the final decision on alternative sites for the rugby club has been taken by a government appointed Planning Inspector, not the council,” he added.

Councillor Mackenzie insisted that the most recent attempt by Crest to establish a residential value for the Claro Road site under the Land Compensation Act was rejected by a government appointed Planning Inspector as recently as January 2010.

“Obviously, circumstances in 2011 are somewhat different to those of 1999. The Local Plan has now been superseded by a new Local Development Framework, attempts to find an alternative site for the rugby club have not been successful and the residential property market has been through a period of massive upheaval. Given the changed circumstances it is only reasonable that the council should look again at the Claro Road allocation,” he added.

The supposed ’compromise’ proposal floated by Crest would see two thirds of the Claro Road site developed for housing, one third developed as an all weather pitch with floodlights and other rugby provision dispersed to a remote out of town location, Councillor Mackenzie explained.

“How the proposal provides for the large number of junior and amateur players within the club, addresses the acknowledged need for additional pitches or could in any sense be considered sustainable, remains open to question,” he said.

“Under the Local Development Framework (LDF), the council is obliged to identify sites for new housing. It is also required to review all previous land allocations and make provision for other uses including community sports. The vehicle through which this is to be achieved is a Sites and Policies Development Plan Document. In regard to the community sports element, a sports working group has been established to inform the production of this document.

“There is the opportunity to use the LDF process to test the acceptability of mixed use at Claro Road, alongside alternative proposals for wholesale relocation of the club to another site. Both Crest and the club have been urged to utilise this mechanism in determining a way forward. It is regrettable that Crest have chosen to ignore this and that they have also been unwilling to respond positively to the very generous re-purchase offer made by the rugby club.

“Crest Nicholson’s own press release acknowledges that the club has offered to re-acquire the ground for a figure in excess of £1m, £400k more than the amount paid to the club in 1999 and well above the current market value of the site.

“Crest Nicholson is not the first, nor will it be the last, housebuilder to enter into a commercial arrangement that fails to produce the expected return. Indeed the story of the past two years has been one of significant losses in the property sector. Crest Nicholson do however appear unique in being willing to force a long-standing club out of existence all for the sake of £143k.

“The Borough Council has already helped the club by extending the period for repayment of an outstanding loan and remains willing to enter into discussion with any party genuinely committed to finding a way forward that is consistent with current planning policy and that has the broad support of the local community. The council is not however prepared to accede to bullying tactics or to be bounced into a decision that is not in the district’s long term interests.

“The council would once again urge Crest to accept the club’s very generous offer to buy back the site and accept that the speculative decision to purchase the land has ultimately proved to be unsuccessful,” added Councillor Mackenzie