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REPORT

Report of the Council on the construction of a new Faculty building for the School of Education

The COUNCIL beg leave to report to the University as follows:

1. Following approval of the Joint Report of the Council and General Board on teaching and research in Education, and on Homerton College (Reporter, 2000-01, p. 216) the convergence between the University School of Education and Homerton College in relation to teaching and research in Education, and the transfer of the College's teaching and research activities to the University took place with effect from 1 August 2001. The Report stated that an important element of the scheme of convergence was that the University Department of Education (at present divided between various premises in central Cambridge, centred on Trumpington Street, and the building of the former Institute of Education in Shaftesbury Road) would be concentrated on the Homerton site, to take advantage of co-location with the existing facilities at Homerton College, which include the new Mary Allan Building, partly funded by the Higher Education Funding Council for England (HEFCE).

2. This Report proposes the construction of a new University building on the Homerton site, on land to be leased from the College, and the disposal of the buildings currently occupied by the School (now Faculty) of Education with the proceeds applied to funding the new building.

3. Consultant architects were appointed by the University to carry out a space requirement study for the Faculty of Education. The study indicated a need for 6,851 sq.m. of assignable space. As part of the convergence, an agreement was reached between the University and Homerton College whereby Homerton's Mary Allan Building would be shared between the College and the Faculty of Education. Under a proposed 60-year lease, part of the building will be occupied exclusively by the Faculty throughout the year and part will be shared by the Faculty and College, to enable the College's conference business to continue. The Faculty also occupies other parts of the College buildings pending construction of the new University building.

4. After taking account of the space leased from Homerton College, the balance of the Faculty's space requirement is for 3,650 sq.m. of assignable space (5,000 sq.m. gross), to provide a library, tutoring and seminar rooms, a lecture theatre, offices, a canteen, and associated facilities. The University proposes to take from the Trustees of Homerton College a 99-year lease of the Northern Site and Trumpington House (indicated in outline on the plan accompanying this Report) and to construct a new building to meet these requirements. The estimated cost of the new building is £13.735m, including fees and VAT. The lease will be at a peppercorn rent and a premium of £2,887,500 (index-linked), to be charged to the University's Land Fund. The current balance on that Fund, taking account of all agreed and proposed commitments, is a negative figure of £9.27m. After purchase of the lease from Homerton the Fund will dip further into deficit. Anticipated income from donations and sale of land at Addenbrooke's (related to the CR-UK project, see Reporter, p. 342) and from proposed sales of non-operational land at Milton Road amounts to around £13.5m over the next three years. This is intended to bring the Land Fund back into credit.

5. Detailed planning permission has been applied for. Plans are on display in the Schools Arcade. Considerable effort has gone into protecting the trees on site and to providing an affordable and efficient design. The estimated cost of £1,583 per sq.m. is lower than in several comparable buildings.

6. Funding for the new building will come from a number of sources: Homerton College will itself provide £1,867,500, which includes SRIF funding of £385,000 and HEFCE transitional funding of £68,000. The Faculty of Education will provide £525,000. HEFCE transitional funding for the University amounts to £110,000. A Finance Division Education Reserve Account contributes £410,000.

7. The Council propose, however, that the main funding will be from the proceeds of the disposal of the buildings currently occupied by the Faculty of Education, namely 15, 16, 17, and 18 Trumpington Street, 2, 3, 4, and 5 Bene't Place, 17-19 Brookside, and the former Institute of Education Building in Shaftesbury Road. The latter building is owned freehold by Cambridge University Press, who have purchased the outstanding term of the University's lease. A sum of approximately £3,500,000 is currently on deposit and continues to earn interest for the project.

8. It is planned to sell the freehold of 17-19 Brookside, which is remote from other University sites and not well suited for alternative operational use. The Trumpington Street and Bene't Place properties adjoin the Old Addenbrooke's Site. Although disposal of these properties is consistent with the Estate Strategy, it is intended that the University will retain ownership of the freeholds, and dispose of leasehold interests, either short commercial leases or long leases, to allow use for residential purposes. These properties are particularly suitable for use for student housing.

9. A valuation of the properties listed above (excluding Shaftesbury Road) for alternative uses was carried out by an independent surveyor in the summer of 2001. A more detailed study is now being done. The Finance Committee have advised that, in order to minimize the risk of funds not being available, contracts for sale or disposal of the properties should be entered into before the main Stage 2 Building Contract is signed. A further analysis will be carried out in January 2003 in order to ensure that the best price can be obtained and that sufficient funds will be available for the new building. It may be necessary for the University to capitalize the income stream if the disposals are on terms which do not produce a capital sum, or to underwrite cash-flow shortfalls if construction costs are incurred in advance of disposal receipts. The Council believe, however, that any such short-term underwriting will be more than offset by the saving of £260,000 a year on rent payable to Homerton College once the new building is occupied. Subject to the constraints of commercial confidentiality, the Council intend to publish further financial details in due course for the information of the Regent House.

10. It is estimated that the running costs of the new building will be £20 per sq.m. less than those of the existing buildings occupied by the Faculty of Education. The gross floor area of the new buildings will be 1,839 sq.m. less than the total gross floor area of the existing buildings.

11. The Council recommend:

I. That approval be given for construction of a new building for the Faculty of Education at Homerton College.

II. That approval be given in principle for the sale or other disposal of numbers 15, 16, 17, and 18 Trumpington Street, 2, 3, 4, and 5 Bene't Place, and 17-19 Brookside, subject to the announcement of agreed terms to the Regent House by way of a Council Notice in due course.

III. That the Treasurer be authorized to accept tenders for construction of the new building for the Faculty of Education and all associated works, subject to costs remaining within the project budget and full funding being identified.

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Cambridge University Reporter, 27 November 2002
Copyright © 2002 The Chancellor, Masters and Scholars of the University of Cambridge.