£220 million costs missing from Lowood 'guidance'

EXCLUSIVE by DOUGLAS SHEPHERD

The sizeable sums of public and private money required to develop the Lowood Estate in the Scottish Borders, and the financial resources needed to deliver the overall Tweedbank Masterplan do not feature in Supplementary Planning Guidance [SPG] which will now be put out for public consultation.

Although the absence of any meaningful published capital expenditure figures in the documents produced by Scottish Borders Council could be seen as hindering the consultation process, details of just how much cash could be needed for the massive project were in fact presented to the council in private as long ago as January 2018. These vital statistics appear to be part of a closely guarded secret.

The presentation took place several months before the local authority concluded a deal with two companies based in the faraway Cayman Islands which resulted in SBC buying the Lowood land by the banks of the River Tweed for £9.6 million plus expenses and fees. The confidential report from consultants Turner & Townsend Cost Management Ltd. contained a breakdown of the likely sums needed for each aspect of the Masterplan based on August 2017 prices.

It is worth noting that Turner & Townsend's estimates excluded any allowance for legal or professional fees, and increases which were likely to be incurred due to inflation were not factored into the calculations either.

According to the confidential report the grand total needed to complete the Masterplan measures stood at £216.319 million in January 2018, close to a preliminary estimate of £220 million.

The Lowood element of the plan would require £106 million, including a £10 million sum to cover acquisition of the estate. Various infrastructure costs linked to the future developments at Tweedbank and set out in the report totalled more than £21 million.

The overall figure needed by the council and its development partners almost equates to the total spend on capital projects by the local authority over a ten-year period. Proposals included in the last ten-year capital programme which received approval in 2018 will require the investment of £294 million.

The new SPG document, also drawn up by external consultants, does not specify how many houses will be built during the various phases of residential developments on and around Lowood even though numbers will be crucial to the scheme's economic viability. There is a strong hint given that a so-called 'indicative' figure of 300 new dwellings is likely to increase when planning permission is sought for the various zones of housing land.

However, specific figures on house building were included in the Turner & Townsend report of January 2018. It allowed for 437 housing units made up of 284 two-beds, 59 three-beds, 59 four-beds and 35 five-beds.

A figure of £5.4 million was also quoted as the likely cost of converting Lowood House - home to the Hamilton family but now in council ownership - into a boutique hotel. Yet housing numbers and other key details concerning the intended developments on the estate are not mentioned in the SPG.

A press release issued by SBC to coincide with a council discussion to approve the SPG claimed: "The draft SPG provides direction on the development of new residential and high quality business space within Tweedbank, with 350 jobs estimated to be created and the potential to generate £150million of Gross Value Added (GVA) to the Borders economy."

One observer commented: "It seems strange that SBC has been able to come up with job numbers and GVA figures but has declined to produce detailed costs or tell us how many houses will be built on this very sensitive site. On that basis it will be difficult to say whether the so-called Masterplan is viable".

In early 2018, during negotiations between the council and agents for Lowood's owners, councillors were also told in private: "The agents have indicated that the estate has had a number of property developers making enquiries now that the site has been identified in the LDP [Local Development Plan].

"However, the owners' preferred way forward is to deal directly with the council if we can conclude within the identified timescale".

And the confidential documentation also stated: "The council will seek to identify suitable development partners, both public and private sector, to ameliorate any development risks".

So far the council has not publicly identified any development partners. The consultation period during which comments and representations can be made on the SPG's contents will run for twelve weeks.