London,
11
October
2012
|
00:00
Europe/London

Hackney Council statement: Position on 136-138 Kingsland High Street

The property at 136-138 Kingsland High Street belongs to Hackney Council who has been the only legal owner of that building since purchasing it in 1984. The Council did not purchase the property on behalf of Centerprise or any other organisation, and Centerprise have never had any legal interest in the property beyond that of a tenant.

Centerprise were paying a rent of £520 per year for the use of this building for many years.  That's just 8p per square foot. They are also subletting parts of the building to private businesses, rent that should be collected and used by the Council. This situation could not be allowed to continue, which is why the Council tried to work with Centerprise to negotiate a new lease.

The Council has a subsidised rent rate of £4 per square foot for several buildings occupied by charities and community groups. Centerprise have been given several opportunities to demonstrate that all of the services being delivered from the premises are of benefit to Hackney residents; and that the organisation is well managed and in a financial position to pay the subsidised rent. To date, the staff and trustees at Centerprise have not been able to show this and are therefore not eligible to receive the discounted rate.

Centerprise's recent offer of £12,000 per year is less than £2 per square foot; substantially lower than the rate per square foot paid by eligible voluntary and community groups including London Community Credit Union, Daymer Turkish and Kurdish Community Centre and Hackney Chinese Community Centre. It is also considerably lower than the approximate rent of around £37,000 per year for private businesses. Their offer is not a fair or acceptable rent for the double shop-front, two floors and a basement on a busy high street, and it would mean Centreprise getting a subsidy from the taxpayer beyond that received by any other organisation in the borough.

 Hackney Council has no intention of selling this building - it is a valuable asset belonging to the people of Hackney – and we are committed to ensuring that it is used by a voluntary or community group to provide services for local people, and for the money collected in rent to support the upkeep of the building during these difficult financial times.

 Centerprise have previously claimed that the Council purchased the property on behalf of Centerprise and these claims were the subject of extensive legal proceedings in 2004. Those proceedings resulted in a High Court trial in 2004 in which the claims were dismissed by the Court and Centerprise ordered to pay substantial legal costs to the Council. Centerprise's attempts to appeal that judgment to the Court of Appeal were also dismissed.

Council officers met with Centerprise more than once. The purpose was to ensure Centerprise fully understood what they would need to do to ensure they were eligible for the discounted rent. Centerprise were given every opportunity but unfortunately, despite the Council’s best efforts this was unsuccessful and Centerprise could not demonstrate eligibility for a new lease at the discounted rent.

Ends