Home For the record For the record: Kirkby town centre purchase 
For the record

For the record: Kirkby town centre purchase 

by Gemma Melling

Kirkby town centre update – 22 November 2019

Knowsley Council announced its intention to purchase St Modwen’s assets on Friday, 19 July 2019.  Just four months later, the negotiations have been completed successfully and Knowsley Council is now taking over as the owner of the town centre – for the first time ever!  What this also means is that Knowsley Council can now drive forward the development plans for the town centre, starting with a new retail development – something which had been promised by the private sector for over 20 years.

We know that you will have questions and have tried to answer many of them below.  We will also continue to update these FAQs as more questions and feedback are received.

 What price have you paid and what does this include?

The total cost of the project to the council is £43.8m – this includes the purchase of 87 shops and 12.4 acres of land along with the scheme to build 94,000 feet2 of new retail space, including a new supermarket, petrol station, new retail / food outlets along with additional car parking.

Specifically, the price of £43.8m covers:

£17.8m = existing shopping centre

£4m = land

£20.7m = new development

£1.3m Stamp Duty and professional fees

How is the project being funded?

The council will borrow the funds to carry out the project, and will repay the debt from the rental income generated by the existing town centre and the new development. If any of the land in the town centre is sold on to new developers in the future, the capital receipts could also then be used to settle some of the outstanding debt. The council is also in discussions with the Liverpool City Region Combined Authority and we hope that the Combined Authority will also agree to invest in the project.

What timescales is the council working to?

Knowsley Council was never starting from scratch with a completely new retail development. Part of the deal it has agreed with St Modwen was to secure a guaranteed start date with a new contractor. The council has now instructed the new contractor to start, and work will commence on site in the week commencing 9 December 2019.

We will provide regular updates on the construction timescale once the work has commenced.

Is the council still working with St Modwen?

Before they decided not to proceed with their scheme, St Modwen had drawn up a number of detailed plans.  They had secured planning permissions and highways agreements, and they had a contractor on stand-by.  They had also secured a number of new tenants, including Morrisons (for a supermarket and a petrol station), Home Bargains (for a new store), and KFC.

If the Council had decided to start from scratch, all of that work would have been wasted. It would have taken the Council at least another year to “start from scratch”, and that sort of delay could have led the new tenants to decide to pull out of the scheme.

Local residents and businesses have called for the scheme to be brought forward as quickly as possible, so it was therefore essential that the Council did everything it could to avoid the risks of having to go back once again to the drawing board.  As a result, the Council is going to use the arrangements which St Modwen had in place – this means that St Modwen will be managing the contract to build the new retail development and will be paid a fee for that work.  Beyond managing the building contract, St Modwen will have no other role.

The building work itself will be carried out by another contactor (GMI), who will be paid directly for the actual build of the new retail development.  Once the new buildings are completed, St Modwen’s involvement in Kirkby will come to an end.

What’s happening on other sites in the town centre?

In addition to the retail development in the town centre, good progress is being made on plans to deliver a cinema and associated food and drink outlets (on the former Kirkby Library site on Newtown Gardens).

The council is also progressing with plans to purchase the Knowsley Community College site on Cherryfield Drive and facilitate the college’s aspiration to open a new facility at the heart of the town centre.

We will engage residents and businesses in developing our plans for the wider town centre, including seeking views on development opportunities.  Further details will be available here on Knowsley News as and when these consultation exercises are being arranged.

Why has it taken so long to get to this stage?

As previously stated, the council has never owned the town centre – it’s always been owned by private companies and developers.  The council has done everything it can to support and encourage development, but its hands have been tied to some extent as it has not been the land owner.

It has become clear in recent months that the only way in which a supermarket could be delivered in Kirkby town centre would be if the council stepped in and took over, and that is exactly what it has done.  Again, this is the first time that Knowsley Council has been in control.

In just four months since deciding to go ahead with the acquisition, the council has reviewed more than 320 leases, investigated 12.4 acres of land, undertaken building surveys for 87 existing shops, reviewed the design and construction detail for the new retail, food and beverage units and petrol station, scrutinised the construction contracts and pricing, made arrangements for insurance, and had legal agreements drawn up.

Given the pace which we have worked at to get to this point in such a short time and the size of the investment involved, there can be no doubt about Knowsley Council’s commitment to Kirkby town centre – the council is delivering what it said it would deliver.