Agenda item

Report of the CGO and Director of City Bridge Trust

The Board considered a report of the Chief Grants Officer and Director of City Bridge Trust (CGO), providing updates on the Bridge House Estates review and the Stepping Stones Fund, and seeking permission for an investment decision on the Greenwich Leisure Limited bond.

The CGO advised the Board of the request from Greenwich Leisure Limited to extend its investment for a further three years at a reduced interest rate of 3% for the extension period. Officers had begun doing due diligence on the extended investment but due to the tight timeframe available for decision, were seeking delegated authority to extend the investment if it was considered to be suitable.

Members discussed the proposal and queried the request for the reduced interest rate. The CGO advised that Greenwich Leisure Limited had not disclosed the reason for the reduction and may just have asked for it as it was more favourable to them. Greenwich Leisure Limited had been a reliable and confident investee, and had other investors to appeal to beyond the Corporation.

Members discussed whether the Board would agree the terms on offer it were a new investment rather than an extension, and how far the investment satisfied the social aspect of the Board’s objectives. The CGO added that the reduced interest rate was still in line with the Board’s target financial returns, and that there was a case for the social impact of the investment. In response to a query from a Member, the CGO reported that after completing refurbishment work of sites in the Olympic Park and at the Royal Greenwich Lido, Greenwich Leisure Limited was expanding its social enterprise operations.

Members discussed the proposal further, and suggested offering to invest a greater sum at a higher interest rate, or to allow the original loan to mature if the extension could not be agreed at 4% or more. The CGO advised that officers had spoken to Greenwich Leisure Limited and the organisation was clear that it sought finance at 3%. It was not known whether other investors had already agreed these terms, but it was likely that they could find investors on the basis of their financial position.

Board Members felt that further attempts should be made to secure a higher interest rate, but ultimately the loan could be extended at 3% if this was not possible.

RESOLVED – That the Social Investment Board:

a)            Note the report; and

b)            Agree to delegate the decision to extend the Fund’s holding in Greenwich Leisure Limited to the Town Clerk in consultation with the Chairman and Deputy Chairman.