Making creative use of the NHS estate
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The document discusses several options for how the NHS can make creative use of surplus land assets: 1. Selling land through a public land registry or marketing agent to the highest bidder. 2. Exchanging surplus land for new facilities through partnerships with developers. This provides financial certainty but the NHS loses equity and control. 3. Forming consortiums or joint ventures with partners to develop surplus land in phases, which shares financial risks and workload while maintaining some control over the whole development.
Making creative use of the NHS estate
- 1. Making creative use of NHS estate Peter Molyneux Common Cause Consulting 4 June 2014
- 2. • Land surplus to requirements • Lodge with public land registry for 50 days • If NHS or other public body interested then transferred or sold at NPV. • If not marketing agent instructed and sealed bids sought. • Bids assessed and received by District Valuer • Highest bid accepted. NHS land disposal process
- 3. • Land surplus to requirements • Foundation Trusts must operate within risk assessment framework. • Decision may require approval from the Board and Council of Governors. • NHS Trusts are entitled to keep proceeds up to £5m. • Over £10m a business case is required. • Up to £50m a business case for investment must receive NHS TDA approval. • Over £50m DH and Treasury approval is required. Rules on assets
- 5. • Low financial risk • Raises fixed capital sum quickly – for investment in new facilities • Overage partly recoups uplift from development • Trust loses equity in perpetuity • Trust loses control over development and development of community infrastructure is difficult • Early sale may reduce income and cost control needs to be robust to limit risk of overrun. Release value of land at outset
- 7. • Surplus land is exchanged for new mental health facilities. • Financial certainty is delivered early – design certainty also needs to be delivered early. • Trust is not distracted from core purpose. • Financial failure of selected purchaser. • Trust is very dependent on purchaser delivering on obligations Cross-subsidy with single partner
- 9. • Selection of right partner will share burden of optimised delivery of the whole • Control maintained over timing and sequencing of the whole development and community development. • Sales values maximised. • JV structure could be used to incentivise the delivery of holistic best value. • Income at risk from market fluctuations. Single flexible partner, release in phases using open supply chain
- 11. • Selection of right partner will share burden of optimised delivery of the whole • Financial risks and workload are shared. • Opportunity to engage or involve community partners in the consortium – which can also hide / reduce value of cross subsidy. • Risk share may reduce outturn value to the Trust for cross subsidy. • Delivery of best value in discrete elements may not deliver best value overall. Consortium approach to whole of planning consent
- 12. • Housing associations should have a clear service offer that is measurable, tradeable and marketable. • Understand service transformation and CIP programmes and how they can help with them. • Understand land disposal plans of local Trusts and appetite for disposals or JVs • Understand proposals of local authority. Making an approach