Public procurement notice: Voluntary Ex Ante Transparency Notice
Published: 2016-11-18
Buyer: Waverley Borough Council
Country: UK
Region: Surrey
Contract type: Works
Procedure: Contract award without prior publication
CPV classification: 45200000: Building and civil engineering work | 45212150 | 45213110 | 45213111 | 45213112
Estimated value: 108000000 GBP

Technical requirements: Roboty budowlane w zakresie wznoszenia kompletnych obiektów budowlanych lub ich części oraz roboty w zakresie inżynierii lądowej i wodnej
Mixed Use Redevelopment of the East Street area of Farnham, Surrey by undertaking works conforming to a Development Brief at the initial procurement stage and Required Elements as provided for in the Development Agreement entered into 2003. Specifically, the agreement provides for the construction of a mixed use development, the scale of which has previously been reduced from what was contemplated when the contract was first awarded, owing to external events including changes required to obtain planning permission. The agreement is conditional upon the satisfaction of a number of conditions. In current circumstances the financial viability condition cannot be satisfied without certain modifications to the terms of the agreement, and the exercise of rights of waiver contained in the agreement.
This VEAT notice relates to proposed modifications to the Development Agreement. It is not the award of a new contract. See additional information given at Sections II.2.4) and IV.1.1).
This notice relates to the proposed modification of an existing contract (estimated gross value 108 000 000 GBP) in circumstances in which the modifications do not require the modified contract to be the subject of a new procurement. The contract amounts to a works concession, which was originally entered into in 2003 following a competition, and has been varied on a number of subsequent occasions. The Council is proceeding without a fresh procurement on the grounds that the modification is not subject to Directive 2014/23/EU of the European Parliament and of the Council as implemented by the Concession Contracts Regulations 2016, because it has been the subject of negotiations since before 18.4.2016, and it would not in any event amount to a substantial modification, and nor is it a material change applying the principles in Pressetext — Nachrichtenagentur C-454/06 (2008) ECR 1-4401.
The contracting authority is not awarding a new contract but is modifying the awarded Development Agreement in accordance with the principles in Pressetext (see above). See also II 2.4) and IV.1.1) for further information.
The character, location or overall nature of the agreement will not be materially changed. The proposed principal substantive changes are: a) the Council will exercise its right to waive the requirement for a minimum land value payment (currently set at 8 760 000 GBP), and will instead receive a payment of 3 640 000 GBP; b) there will be certain other adjustments to the financial provisions of the agreement including those relating to the proposed car park, the developer's share of CPO costs; c) the Council will exercise its rights under the agreement so as to permit the developer to construct commercial elements itself; d) the head-leases/sub-leases for which the agreement provides will be restructured to allow an overarching head-lease to be granted to the funder of the development; e) the developer will make a financial contribution to the relocation of a community centre rather than re-providing it as part of the development; and f) the affordable housing constructed as part of the development will be disposed of on a shared ownership basis, rather than being a mixture of shared ownership and rental accommodation.
The payment that is to be made to the Council is considered to represent full market value in current conditions. The other changes, in particular those referred to at a), e) and f) above, will enable that payment to be made consistently with the developer securing a sufficient return to proceed with the development. There is no extension to the scope of the agreement. The changes would not have allowed for the participation of other tenderers in, or a different outcome of, the original competition. The original competition was based upon a high-level brief which was very flexible as to what a bidder could propose, and with which the modified agreement will be consistent; the detail of the minimum land value provisions and the tenure arrangements for the affordable housing was established after the outcome of the original competition. The financial evaluation of proposals was based upon matters other than minimum land value. The current provisions for the overage share and head-lease rents to be received by the Council are not being modified. The economic balance of the agreement will not be shifted in favour of the developer since the developer's income will be: derived from third parties; when compared with the original agreement will be reduced and not achieve the same rate of return envisaged by the agreement prior to modification.
The decision to modify as described at Section V.2.1) was made on 24.5.2016 but a binding agreement to effect the modifications has yet to be concluded.
Any applications to the Court must be made in accordance with the relevant rules of the Review body relating to challenges which concern this public works concession contract.


Award value: 108000000