Agenda item

To consider Report No. REG2601 (copy attached), which sets out an update on the Farnborough Leisure Centre projects and seeks approval to enter into a Development Management Agreement for RIBA Stage 5 (construction and handover) onwards.

The Cabinet considered Report No. REG2601, along with appendices, some of which were exempt, which provided an update on the Farnborough Leisure Centre Project and sought approval to enter into a Development Management Agreement for RIBA Stage 5 (construction and handover) onwards for the delivery of a new leisure centre.

The report set out in detail the background to the project and a summary of the decisions that had been taken to date. Members were informed that the total cost to deliver the new leisure centre, playground and surface car park was £27.5 million. £18.5 million of this would be provided by the successful Levelling Up (now known as the Local Regeneration Fund) bid. This would mean the Council would need to borrow an additional £8.8 million to deliver the project. This borrowing would have a revenue implication of interest costs and Minimum Revenue Provision (MRP) charges. The revenue implications of additional borrowing and other revenue costs of operating the site detailed in the report were intended to be funded from the leisure centre operator income, following the successful award of the operator contract, as approved by the Cabinet on 10th February, 2026. The financial modelling and implications were set out in Section 5 of the report and in the Exempt Appendix A.

The Cabinet was advised that this matter had been considered by the Council’s Overview and Scrutiny Committee at its meeting on 24th February, 2026. The Committee had asked for four matters to be reported to the Cabinet, relating to the early circulation of papers, the environmental impacts of the development, protections for the Council in the event of contractor insolvency and the reinvestment of surpluses. Members thanked the Committee for its input and these factors were considered as part of the discussion of the item.

Information relating to the contract, risks and mitigations were set out in Section 7 of the report and the key milestones for the project were contained in Section 8, with a detailed current programme at Appendix E. Section 10 set out more information regarding the risks, along with the legal, financial, resource and equalities impact implications.

In discussing the report, Members expressed strong support for the proposal, which was considered to offer an excellent facility that was shown to be affordable and funded, despite the considerable financial challenges faced by the Council at this current time.

The Cabinet

(i)           RESOLVED that

(a)          the progress with the design of the leisure centre and changes made as a result of feedback during the leisure centre operator procurement process, as set out in Report No.REG2601, be noted;

(b)          the progress of the planning submission for the Farnborough Leisure Centre, as set out in the Report, be noted;

(c)          subject to planning permission being granted and review of the contractor’s proposals, the Executive Director, in consultation with the Executive Head of Finance, the Interim Monitoring Officer and Corporate Manager – Legal Services and the Healthy Communities & Active Lives Portfolio Holder, be authorised to enter into a Development Management Agreement with Alliance Leisure Services Limited, as set out in Section 6.3 of the Report, for the delivery of a new leisure centre and surface car park in Farnborough town centre;

(d)          the continuation of the utilisation of the revenue capacity funding received from MHCLG against revenue costs associated with the project be approved;

(e)          the Executive Head of Finance be authorised to update the Capital Strategy and Treasury Management Strategy, in line with the approval of capital budget and funding set out above, be approved;

(f)           the use of the Council’s powers to appropriate the Queensmead Car Park, Farnborough and the site of the previous Pinehurst Car Park, as set out in the plan at Appendix K of the Report, for planning purposes under Section 122 of the Local Government Act 1972 be approved;

(g)          the use of Section 203 of the Housing and Planning Act 2016 to remove any legal constraints to development be approved, with the Interim Monitoring Officer and Corporate Manager – Legal Services and Section 151 Officer, in consultation with the Executive Head of Property and Growth, being authorised  to agree any compensation payable to beneficiaries of rights under Section 204 of the Housing and Planning Act 2016, following due diligence of their claim;

(h)          the decision of the Interim Monitoring Officer and Corporate Manager – Legal Services as to protective measures be noted, with the Interim Monitoring Officer and Corporate Manager – Legal Services, in consultation with the Executive Head of Finance, being authorised to negotiate the terms of the protective measures to not exceed £100,000 (Cabinet noted the £100,00 did not appear in the projected costs set out in the Report as the outcome of the negotiations was not yet known); and

(ii)          RECOMMENDED TO THE COUNCIL that the Executive Head of Finance and Section 151 Officer be authorised to put in place a Capital Budget up to £27.5 million for the project to be funded by external funding (Levelling Up Programme/Local Regeneration Fund), S106 funds and borrowing as set out in Section 4.2 of Report No. REG2601.