Public procurement notice: Contract Award Notice
Published: 2016-01-14
Buyer: Thurrrock Council
Country: UK
Region: Thurrock
Contract type: Works
Procedure: Competitive dialogue
CPV classification: 45000000: Construction work | 45100000: Site preparation work | 45200000: Building and civil engineering work | 45210000: Building construction work | 45211000: Construction work for multi-dwelling buildings
Estimated value: 800000000 
Award criteria: Quality, Price

Technical requirements: Quality
Price
The Council sought a development partner to bring forward the delivery of the Purfleet Centre Regeneration Project — A critical part of the authority's regeneration agenda. The project will maximise Purfleet's proximity to London and the Thames-side location to create a new, sustainable mixed-use town centre featuring high quality housing alongside employment space, local services (including a primary school, health centre and community facilities) and enhanced transport connections.
On 11.1.2016 Thurrock Borough Council under the authority of the Cabinet Decision of 14.10.2015 entered into a Contract for the Regeneration and development of Purfleet Town Centre and surrounding areas (the ‘Development Agreement’). The background to the award is given below.
On 10.2.2014 the Council closed the OJEU Competitive Dialogue process which sought to identify and select a development partner who would be responsible for delivering the proposals for Purfleet. In March 2014 Cabinet approved the selection of Purfleet Centre Regeneration Limited (PCRL) as Developer and delegated authority to the Assistant Chief Executive in consultation with the Portfolio Holder for Regeneration, Highways and Transportation to conclude the remaining terms of the Development Agreement and associated documentation.
Through a report in December 2014 Cabinet was updated on the progress towards completing the Development Agreement between PCRL and the Council; site acquisitions; And the approach to planning and public consultation undertaken following PCRL's selection. In addition the report noted that a funding partner had been identified by PCRL.
L&Q New Homes Limited, as funding partner, has taken an equity stake in the Consortium and has taken over as guarantor in respect of some aspects of the development works alongside Keltbray. Bouygues have not taken an initial equity stake in the PCRL consortium. Accordingly, since the close of dialogue a number of amendments have been made to the Development Agreement to reflect the requirements of the funder which have the effect of (a) Making the commencement of Phase 1 conditional on the satisfaction of a financial appraisal for Phase 1; (b) Introducing greater certainty into the calculation of the Council's Overage and providing greater detail of the categories of costs that are counted as Development Costs in calculating the Developer's Return and the Council's Overage; (c) Removing the grant of a legal charge to secure the Council's Overage given the introduction of L&Q New Homes Limited as guarantor; (d) Introducing greater flexibility into the manner of exercise of the funder's step-in rights to enable the funder to novate the agreement to a representative approved by the Council; and (e) Ensuring that any Phase/Sub-Phase undertaken by Sub-Developer is ring-fenced from any breach of the agreement not affecting the Phase/Sub-Phase.
Following an extended due diligence process, terms have been settled which will secure the funds necessary to secure the delivery of the project and satisfy the requirements which allowed the development to proceed.
In terms of the development itself, PCRL's formal submission included a high level master plan which set out an exciting vision for Purfleet Centre. The proposal took the critical elements of the Council's original scheme and augmented them to propose a high quality, aspirational development which includes i) A state-of-the-art film, television and media studio complex; ii) More than 2 300 new homes set around a new town centre; iii) New school facilities; iii) A redeveloped station; and iv) Local facilities including a supermarket, community hall, health centre.
These features aligned with the Council's objectives of relocation of industrial uses and distribution based activities out of the town centre area to create a new residential led mixed use town centre; Creation of a new business environment to attract office accommodation within the town centre, including small business units encouraging indigenous growth and new employment uses; Development of new skills through the provision of new educational facilities; Well-being of the community through access to new health facilities offering a wider range of services; Provision of new leisure and recreation facilities; Creation of a range of amenity areas harnessing the access to the River Thames and wider green spaces; Promotion of high quality design and ecologically friendly development that reinforces sustainable values; Provision of a mix of flats and houses including the provision of affordable housing; Utilisation of excellent public transport. Delivery of this scheme also necessitates a new planning permission and the satisfaction of conditions associated with the delivery of phase one including a financial appraisal of that phase and the revised approach to planning will allow a sequential development as envisaged with the media studio phase being developed in parallel with other phases.
In making their submission to the Council in February 2014, the Developer made it clear that they would need to secure an investor/funder to support the delivery of their vision. The implications of this in terms of certainty of delivery were weighed up in the assessment conducted at the time. The conclusion of the Developer's work to identify and secure a funding partner and the settled terms of the Development Agreement together with planning/design, acquisition activity and public engagement have all progressed in line with the Developer's original proposal.


Winner: Purfleet Centre Regeneration Limited
Number of bids: 1