United Kingdom-London: Commercial property management services
Voluntary ex ante transparency notice
Section I: Contracting authority/entity
Main address: www.peabody.org.uk
Section II: Object
Fish Island Village — Management Agreement
A Management Agreement for the provision of various project management, marketing and property management services in respect of ground floor commercial premises at Peabody's Fish Island Village development in London.
The Management Agreement is for the provision of various project management, marketing and property management services in respect of ground floor commercial premises across the following elements of Peabody's Fish Island Village development in London:
— Monier Road,
— Block B,
— Block C,
— Block D,
— Block E,
— Block F,
— Block G,
— Block H,
— Block K,
— Block L.
Under the Management Agreement the service provider will be required to provide the following services in respect of the commercial premises covered by the agreement:
(a) continued delivery of an ERDF-backed business support programme,
(b) continued design and project management activities in preparation for fitting out the commercial premises as workspaces,
(c) continued marketing activities to build market awareness and a tenant pipeline for the commercial premises,
(d) commercial property agency work.
The Management Agreement will be for an initial term of 15 years, with a provision to extend (by agreement between the parties) for a further period of 10 years.
Section IV: Procedure
The Management Agreement is to be awarded to the Trampery Fish Island Village Limited (the Trampery) pursuant to Regulation 32(2)(b)(iii) of the Public Contracts Regulations 2015 (the Regulations). For the reasons set out below, the Management Agreement can only be awarded to the Trampery for reasons connected with the protection of exclusive rights, and no reasonable alternative or substitute exists.
On 23.12.2015 Peabody Enterprises Limited (PEL) entered into an Agreement for Lease with the Trampery pursuant to which PEL were to grant the Trampery a lease of the commercial premises at the FishIsland Village development. The Trampery would then operate its business from the premises and pay PEL an element of the profit it generated pursuant to the terms of a Profit Share Agreement which the parties were required to enter into on the grant of the lease. The Agreement for Lease was not tendered in accordance with the Regulations as it was considered to be an agreement for the disposal of an interest in land rather than a public works or services contract for the purposes of the Regulations. On 5.4.2017 PEL assigned its interest in the Agreement for Lease to Peabody Trust (Peabody). Due to market changes it has now been decided that the Trampery will relinquish its right under the Agreement for Lease to be granted a lease of the premises, and Peabody will instead enter into the Management Agreement with the Trampery under which the Trampery will be required to provide the services described in this notice in return for the payment of a monthly management fee.
Peabody is of the view that the Management Agreement can only be awarded to the Trampery in this case due to the pre-existing arrangements and rights that the Trampery has under the Agreement for Lease — namely, the right to be granted the lease of the premises. No “reasonable alternative or substitute” exists because the Trampery will not agree to relinquish its rights under the Agreement for Lease unless Peabody agrees to enter into the Management Agreement with it for the provision of the services. The absence of competition is not the result of an artificial narrowing down of the parameters of the procurement. When PEL and the Trampery entered into the Agreement for Lease originally it was not their intention that the approach would be altered later down the line and that a Management Agreement would be entered into instead of a lease. Accordingly, the parties have not acted "artificially" with the intention of avoiding the application of the Regulations.
Accordingly, Peabody is of the view that the exemption under Regulation 32(2)(b)(iii) of the Regulations applies to the award of the Management Agreement to the Trampery in this case.
Section V: Award of contract/concession
Section VI: Complementary information
The Contracting Authority intends to enter into the Management Agreement following a minimum 10 day calendar day standstill period starting on the day after this notice is published in the Official Journal of the European Union. The Public Contracts Regulations 2015 (SI 2015 No. 102) (as amended) (the Regulations) provide for aggrieved parties who have been harmed or who are at risk of harm by a breach of the Regulations to bring proceedings in the High Court. Any such proceedings must be brought within the limitation period specified by the Regulations according to the remedy sought.
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GO Reference: GO-201926-PRO-14024549