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Report 13 of the 23 June 2011 meeting of the Finance and Resources Committee, seeks approval for a full internal refurbishment of Jubilee House and the disposal of three properties.

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Jubilee House - Proposed refurbishment

Report: 13
Date: 23 June 2011
By: Director of Resources on behalf of the Commissioner


In line with the MPA/MPS Estates Strategy and the principles of Corporate Real Estate (CRE) to improve the utilisation of properties within the estate, releasing those properties surplus to operational need, this report identifies refurbishment reasoning, proposals and opportunities that will be realised from undertaking a full internal refurbishment of Jubilee House and seeks MPA approval to proceed on this basis.

A. Recommendations

That members

  1. Note the terms of the MPA’s leasehold interest in Jubilee House and the opportunities proposed in regard to the refurbishment of Jubilee House including:
    Refurbishment to current MPS Office Standards to maximise floor density and utilisation
    • Modernisation of mechanical and electrical plant and systems reducing energy use, revenue costs and CO2 emissions from 1076 tonnes to 571 tonnes per annum, extending the operational use of the property and addressing certain leasehold responsibilities
    • Reducing ongoing revenue liabilities elsewhere in the estate.
  2. Approve the project budget of £23.147m for contract works and professional fees in connection with the fit out works for these premises.
  3. Approve the appointment of professional advisors and contractors through approved and compliant procurement routes (OGC and IESE/2) and delegate authority to the MPS through the approved scheme of delegation to approve the letting of contracts, within the requested project budget allocation.
  4. Approve in principle the disposal of three properties with capital receipts estimated at £5.33m, as referred to in exempt Appendix 1, following the occupation of Jubilee House. In accordance with MPA Finance Regulations a further report will be submitted prior to the three properties being marketed.

B. Supporting information


1. In Spring 2010, the MPS Management Board supported the development of the CRE approach to the provision of accommodation, including the proposal to rationalise office accommodation across the estate, focusing on improving the use of existing MPA facilities core to the estate.

2. Embedding the principles of CRE, the MPS are now increasing utilisation levels in these core buildings to enable to the release of assets surplus to the estate.

Existing Building and Issues

3. The MPA hold a 75 year leasehold interest in Jubilee House until March 2051. The lease is a full repairing insuring lease with no break clauses and 5 year upward only rent reviews. As one of a number of buildings incorporated into the 2004 MPA/MPS Central London Estate Strategy, opportunities to exit the property were explored. Terms for both assignment and sub-letting are onerous, restrictive and non attractive to the rental market with any subletting subject to a minimum 21 year term. The strength of the MPA’s covenant together with the rental levels under the terms of the lease are such that the landlord treats the investment as a ‘bond’, and will not consider releasing the MPA from existing liabilities. As such, Property Services recommend the MPS maximise the use of the property for the duration of the lease.

4. Constructed in early 1970’s and situated on the corner of Putney High Street and Putney Bridge Road, London SW15, the building comprises of three connected blocks of differing heights, Block 1 is nine stories, block 2 is five and block 3 three, with a combined nett internal floor area of 6724m2 which currently accommodates approximately 500 desks.

5. The property accommodates office facilities, catering, Safer Neighbourhood facilities and 100 car parking spaces; much higher than the number of spaces that would be granted for a similar development in 2011. The property is key to the DoI Real Time Communications Strategy, providing core functionality.

6. The main mechanical and electrical service equipment supporting the building has been maintained or replaced on an ad hoc basis. Many components are now obsolete and represent an on going liability to the MPS. The system when compared with modern day installations is non compliant with current regulation requirements and is inefficient.

7. The current layout of accommodation is predominantly cellular office format resulting in a number of double corridor situations and thus reduced workstation density. Toilet facilities, finishes and fittings throughout are in poor condition and in need of replacement.

8. Property Services commissioned a feasibility in 2009/10 to review refurbishment options for the building including a comparison of the cost of refurbishment proposals against the MPA’s ongoing cost and liabilities in maintaining the building in its present form. This “Whole Life” costing study has comprised several separate elements to report fully on all aspects of the ongoing costs, both following the completion of the fully refurbished building, including ongoing planned maintenance requirements and the liabilities presented by the existing deteriorating installations.

9. Feasibility studies have established that due to the condition of the mechanical and electrical infrastructure and the design of the building, refurbishment cannot be implemented on a floor by floor basis. In looking at refurbishment options a number of opportunities exist:


10. Current occupancy levels within the property are less than 50%. This presents a unique opportunity to undertake a refurbishment in a two phased construction approach with the incumbent occupiers being relocated within the building to enable refurbishment on a block by block basis. This will alleviate the necessity of any advanced preparation of other facilities or double moves with associated costs.

11. Typical floor plate refurbishment would be to current MPS Office Standards, developed as part of the CRE office strand, to include open plan desking systems, interspersed with storage areas, several single offices, quiet rooms and break out areas to each block to provide a ‘standard’ office layout.

12. A maximum density of occupants has been determined by following MPS Office Standards and balancing this with building constraints such as staircase sizing, fire escape routes, lift usage etc. The result increases the current number of desks from 500 to approximately 700.

13. By undertaking a phased refurbishment by block, a new mechanical and electrical services systems solution can be incorporated. This will support the adoption of MPS Office Standards, promoting efficient open plan office accommodation, supporting higher densities and agile working principles. This will provide up to 700 desks; supporting over 900 staff, and ensure compliance to the MPA’s leasehold commitments.

14. Refurbishment proposals would include opportunities to improve energy efficiencies and reduce heat loss. Opportunities exist to reduce annual energy consumption from 3,536MWh to 1,769 MWh, a 50% reduction on current energy levels and a 47% reduction in Carbon Emissions, from 1076 tonnes to 571 tonnes per annum. A 20,200 tonnes saving over the remaining lease term, avoiding revenue Carbon Reduction Commitment (CRC) liabilities and further reducing the MPA/MPS Carbon footprint supporting the MPA/MPS Environmental Strategy.

15. Fully utilising a large building delivers better value for money and supports operational need as changes in requirements between business groups can be managed within the building.

16. To address building issues and maximise opportunity benefits a number of options have been considered, the salient being:

Option 1- Do nothing; leave the accommodation in its existing condition

17. The building is currently at approximately 50% occupancy (assuming all the desks which have been allocated are occupied). Ad hoc maintenance/repair may result in resilience concerns at a later date. There are also elements of non-compliance in regard to the MPA’s leasehold commitments, specifically in regard to maintenance and repair obligations.

18. Whole Life Costing comparisons of maintaining the existing equipment, ‘do nothing now’ scenario, highlight that this approach in nett present terms would cost approximately £3,000,000 more than actually undertaking the project over the remaining life of the lease.

19. The ongoing revenue liabilities associated with this option are detailed in exempt Appendix 1. As such this option is not supported.

Option 2- Longer Term Phased Floor by Floor Refurbishment

20. As part of the feasibility process it has not been possible to establish a sensible and cost efficient means by which the building could be refurbished on a floor by floor basis, given the extent of mechanical, electrical and public health services refurbishment and renewals that are necessary.

21. Although from a building fit-out viewpoint (finishes, partitions, etc) refurbishment of individual floors would be a possibility, the proposed alteration of electrical risers and provision of new rising main would mean extensive temporary supplies, disconnection and alteration would be required to maintain supplies to other floors both above and below the floor being refurbished. This requirement would be on-going and would affect services both to existing floor and following refurbishment, to completed floors.

22. This option would affect existing users, delay optimum utilisation of the building and increase considerably the project programme and costs.

23. It is therefore determined that this means of works sequencing would not be viable and as such this option is not supported.

Option 3- Refurbishment Block by Block

24. It is therefore proposed that a refurbishment is undertaken to maximise opportunities that exist by working on each block at a time, leaving the remainder of the building available for use by the existing occupants.

25. The feasibility construction programme indicates an ‘on site’ construction commencing in January 2012 and completing June 2014, with the interim period used for planning, design and contractor procurement.

26. The works will be coordinated and will be carried out so as not to affect the existing SN base, catering facilities and the existing DoI Core Node.

27. Opportunities described earlier would be realised. This option is therefore supported in going forward.

Current Asset considerations

28. Engagement with Business Groups to discuss the potential to relocate teams within/ to Jubilee House has commenced. Work is being undertaken with the SCD re-alignment programme regarding the feasibility of brigading a number of SCD units into Jubilee House which would potentially release a number of sites across London including Barnes Green, Albany Street and Julian Headon House.

Other Sites Forming Part of This Proposal

29. Barnes Green is on Station Road in Barnes SW13. It is a building dating from the mid 1970s and is owned freehold by the MPA. Reflecting its age and appearance it is the only building excluded from the Barnes Conservation Area. It is presently used as offices and as a base for a number of SCD operational teams mainly covering south-west London.

30. Albany Street is on Albany Street in Camden NW1. It is a police station dating from the early 1960s and is held by the MPA on a ground lease expiring in 2059. It is presently used as an office and base for a number of SCD operational teams with pan London responsibilities. The building also supports a number of Camden BOCU units including Safer Neighbourhood teams and a front counter facility. Any future disposal will be dependent on the re-provision of the front counter

31. Julian Headon House is on The Broadway, Edgware Road, Hendon NW9. It is an office building dating from the early 1990s and is owned freehold by the MPA. It is presently used as an office and base for a number of SCD teams.

C Other organisational and community implications

Equality and Diversity Impact

1. The refurbished property will provide modern compliant facilities that is accessible to staff. Retaining Safer neighbourhood facilities support local borough operations.

2. A refurbishment and subsequent increase in occupancy levels will have HR implications. The timetable for moving units to Jubilee House will need to reflect the notice periods that are required following consultation with staff concerned.

Consideration of MET Forward

3. This paper aligns with the strategic intent of Met Forward section 7, Met Support - in particular the Estates Programme, improving value for money, by maximising the use of core facilities and exiting those properties no longer required for operational needs.

Financial Implications

4. The preferred option outlined above has been worked into illustrative financial models for both revenue and capital lines as detailed in Exempt Appendices 1 and 2.

5. The preferred option will result in significant revenue savings that directly contribute to the Corporate Real Estate Service Improvement Plan.

6. At this stage, current and future occupiers will be expected to supply their own IT and fund connection charges through DoI. Generic electronic access control for general open plan office will be provided, the occupiers will be expected to provide funding for specific electronic access control requirements. As the refurbishment is designed to release other properties, the DoI would expect that the overall technology revenue expenditure at the end of the project to be at least revenue neutral.

7. The refurbishment of Jubilee House will facilitate the delivery of Property Services Savings built into the 2011-2014 London Business Plan.

Legal Implications

8. The provision of office accommodation and the re-location of staff within the estate is a matter within the general powers of the MPA/MPS. They support the discharge of the duty to secure the maintenance of an efficient and effective police force for the MPA area.

9. All regulated contracts for works and services that are required for the proposed refurbishment set out in this report will need to be procured in accordance with the Public Contract Regulations 2006 and EU Directives.

10. Decisions regarding the letting of individual contracts in connection with the project are likely to require further reporting to the MPA/MPS depending on the value of the contract, and must be strictly executed in accordance with the approved strategy and the Contract Regulations that are set out in the MPA standing orders.

Environmental Impact

11. The refurbishment of Jubilee House has the potential to make a significant contribution to the MPS CSR Strategy objective to manage our direct and indirect carbon emissions to reduce our impact on climate change.

12. Energy efficiency and carbon emissions reduction is a key element of environmental management for the MPS. There are significant legislative and policy drivers including the CRC Energy Efficiency Scheme and the Mayor's draft Climate Change Mitigation and Energy Strategy. The MPS Policing Plan includes a Corporate Health Indicator (CHI) for carbon emissions. The MPS is committed to a short term carbon target of a 22% reduction in carbon emissions by 2013 based on the 2006/06 footprint, and a longer target of a 30% reduction by 2025 based on the 1990 baseline. The MPS's carbon footprint, together with energy consumption, is reported in the Annual MPS Corporate Social Responsibility Report (previously Environment Report) using the Defra guidelines for best practice organisational footprint reporting.

13. By taking a whole life cost and carbon emissions assessment approach, the preferred option is based on a more holistic approach taking into account the lifetime costs and carbon emissions, therefore offering Value for Money. The energy efficiency elements of the project will contribute directly to the Energy SIP savings through reduced utility and CRC costs, as well as to the delivery of the carbon reduction target and associated reputational benefits.

  Higher Lower No impact Mitigation/ management of any higher impact
Level of energy use and associated carbon dioxide emissions   Tick   The building on completion of the refurbishment will be compliant to current standards therefore consuming less energy
Level of water consumption   Tick   The building on completion of the refurbishment will be compliant to current standards therefore will use less water
Level of waste generation/waste requiring disposal   Tick   A sustainable waste management plan will be put in place to manage, minimise and recycle construction waste. An office recycling system will be implemented.
Level of travel and transport and associated emissions     Tick The site offers good links to public transport
Raw material use and finite resources (use of recycled materials and sustainable alternatives) Tick     Construction works will be undertaken

Risk Implications

14. As part of feasibility work commissioned in respect of the proposed full refurbishment, a risk workshop was undertaken involving feasibility team members, MPS representatives from asset management and DOI personnel.

15. The workshop was used to establish the potential risks to the project from design, construction, funding, programming, planning etc. These risks are fully identified within the feasibility and will be further managed and mitigated through project Gateways.

16. The major identifiable risks at feasibility stage, highlighted in red on the register are as follows:

  • Construction work in an occupied building leading to access restrictions, noise, dust and vibration issues
  • Disturbance of asbestos and discovery of material not previously identified requiring the safe appropriate removal and disposal of identified material and locations of decontamination units, with potential cost and time implications.
  • End of useable life of equipment not refurbished
  • Stand by generation requirements, may need to be installed early to maintain G32 Data Centre
  • Primary plant retained within the basement, prone to potential flooding.

D. Background papers

  • The Central London Estate Strategy 2004 (updated) - Finance and Resources Committee - October 2010
  • Estates Update paper - Finance and Resources Committee - March 2011

E. Contact details

Report authors: Jane Bond, Director of Property Services, MPS
Contact: Kevin Argent, Head of Standards, MPS

For more information contact:

MPA general: 020 7202 0202
Media enquiries: 020 7202 0217/18

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