Decision Details

The report presents the details of a proposal to utilise the Council’s existing wholly owned company, Birmingham City Property Company (PropCo), to support the Council’s Property Strategy 2018/19-23.

On 27 July 2021, Cabinet:-

1. Approved the strategy for the development of Birmingham City Propco Ltd (Propco) through increasing the capacity of the company’s operations, and its governance as set out in the report;

    

2. Approved a motion to Full Council to amend the General Delegations Part E3.2 of the Constitution to include a new delegation for the approval of disposals from, the Council Property portfolio into Birmingham City Propco Limited to the Leader and Cabinet Member for Finance and Resources, jointly with the Director - Inclusive Growth, Interim Director of Council Management and the City Solicitor (or their delegates) up to a limit of £25m in any one transaction;

    

3. Delegated to the Interim Director of Council Management, in consultation with the Leader of the Council, the authority to buy shares in and approve loans to, Propco up to an aggregate limit of £100m, on commercial terms and in compliance with HMRC rules on ‘thin capitalisation’, subject to a full business case for each investment being approved;

    

4. Approved a capital injection of up to £0.500m into Propco to provide a short-term working capital facility. This advance will be made on commercial terms, by the Council in its role as sole shareholder and will be used to facilitate a programme of acquisitions from the Council; to strengthen the governance of the company, and to develop a robust business plan;

    

5. Delegated the approval of the terms and details of the revised restructure of Propco governance to the designated shareholder representatives, these being the Chief Executive and Section 151 officer; in consultation with the Council’s shareholder representative Group Company Governance Committee;

    

6. Authorised the City Solicitor to negotiate, execute and complete all necessary documentation to give effect to the above decisions.

    

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