The article which follows was first published in Friends Newsletter no 94 (available in full under News on this website). It draws upon publicly available information from internet searches and from the websites of LBs Ealing and Hounslow:
On 25 January we published on the Friends’ website the fact that Ealing Council’s Cabinet had declared the AlphaPlus Group to be their ‘preferred bidder’ for The Small Mansion, to relocate their Falcons School for Girls from its current premises near Ealing Common. Since then Hounslow Council’s Cabinet has taken the same decision. A press release issued on 25 March stressed the potential use of the school by the community on evenings, weekends and holidays, the track record of AlphaPlus in restoring heritage buildings and the injection of vitality into the Park from the school use, together with the investment in the restoration of the building.
The Gunnersbury Park Joint Advisory Panel, 19 April
At this meeting we learnt that the school would have 200 pupils and aims to open in 2014. The impact on the listed building was said to be low, the major change being the installation of a staircase and lift. The impact on the landscape was the acquisition of 0.8 acres between the Mansion and Popes Lane for a fenced staff car park and play area for pupils. There will have to be a study of the traffic impact on the Park.
There was confusion about the notions of ‘community use’. The school appears to be offering rooms (the drawing room and the dining room were mentioned) for hire when it is not using them – a normal practice with most schools, partly to earn money. There was no sense that ‘community use’ was going to be built into an entitlement, though we were told that a lease could be drawn up which guaranteed such a feature. Hiring out smart rooms in an early 19th century listed mansion might generate a trade in events – meetings, receptions, wedding meals etc. But the question was then raised as to whether this would challenge the business plan for restoring the Park and The Large Mansion, for which a catering income was part of the sustainability of the proposals. This issue has not yet been considered.
It was also reported that the Friends’ committee was concerned that the school’s ethos of exclusivity ran counter to the spirit behind the bids to the Lottery which was to make the Park and the Museum more open and accessible to all our citizens.
The AlphaPlus Group were promising to invest £5m to £6m in the building, for a 200-year lease and an as yet unspecified ground rent. It is hard to get a clear figure about how much of this investment is the core restoration of the building and how much relates to the cost of fitting it out for school use.
It was an uncomfortable meeting, as over 50 members of the public attended, wanting to make their views known, especially about the possible infringement of the covenants on the Park. The Councils have promised to conduct a ‘public consultation’, although the starting date for this is unknown. In reality it started with the publishing of Ealing Council’s Cabinet Papers in January, continued by the March press release. So there was some frustration that the meeting was not designed to consult, only to observe. There is already some vigorous debate on the BrentfordTW8.com community forum. If the negotiations between the councils and AlphaPlus on issues like design, safety, traffic and public benefit are resolved, then the whole scheme will still have to get planning permission from Hounslow Council.
What do we know about AlphaPlus?
The Investors Chronicle on 28 November 2012 reported: “The other bond to pique investor interest is a 5.75% issue (ISIN: XS0853358801) from an educational provider called AlphaPlus Schools. The bond is interesting because it is the first on the market to be secured against £84m of underlying assets, putting the bond right at the top of the debt pyramid on a par with senior bank debt. AlphaPlus runs high-end schools in central London and is owned by the DV4 evergreen fund and advised by Sir John Ritblat’s Delancey real estate development company. The company needs cash for expansion after a big increase in pupil numbers in London over the past few years. The basic finances look sound enough – the interest charge would be covered by more than three times Alpha’s cash profits, for example – and the coupon is better than many recent unsecured offerings.” The AlphaPlus website reports that the offer raised £48.5m.
Shore Capital reported: “…For the 5 years ending 31 August 2012, the number of pupils attending the Group’s schools, colleges and nurseries increased by 29.5% from 2,800 pupils to 3,625 pupils. During the same period, average fees per pupil attending the Group’s schools, colleges and nurseries increased by 25.2% from £12,748 to £15,966 p a.”
What do we know about Delancey, the owners of AlphaPlus?
The key figures are Sir John Ritblat, chairman of one of London’s biggest property companies, British Land, from the 1970s until 2006, and his son James, who is chairman of Delancey, which owns Delancey DV4, the private property investment fund which owns AlphaPlus. Sir John is Chairman of the Board of Governors of AlphaPlus while James is a Conservative Party donor who lives in Chipping Camden. There was quite a hoo-ha about their DV3 fund when The Daily Mail and The Daily Telegraph reported on 29 March 2012 that Andrew Mitchell MP, the then International Development Secretary, had investments in it when it avoided stamp duty on a major purchase. As part of its campaign against aggressive tax avoidance HMRC took up the case, lost it and is now appealing. The company is registered in the British Virgin Islands. So there is little doubt that the preferred bidder has the funds and a sustainable business plan. There has been no public discussion yet about what will happen when – for whatever reason – the leaseholder no longer wishes to operate a school.
The longer-term context
This development started with the political volte-face at the end of the public consultation on the building of houses along the rest of Lionel Road. High-level discussions between both Councils led to an agreement that Ealing would invest £5m of capital with Hounslow matching it over the years with s106 funding, to restore the estate in phases rather than all at once, to get rid of The Small Mansion (and the costs of restoration and maintenance), to set up a Project Board of Ealing and Hounslow councillors and officers with English Heritage representation, and to rely heavily on Ealing’s team of major project officers to prepare bids to the Lottery. From that point the plan was to offer the Small Mansion on a lease for development.
We do not know exactly when the school expressed an interest; over the years there have been preliminary discussions with many interested parties, but the possibility of a school has always been present in various recent reports. Its strongest rival was always a catering, functions and conferences operation – for example, the operator of Pembroke Lodge in Richmond Park expressed interest in it a decade ago. A consultant’s report on catering at Gunnersbury dismissed that option for The Small Mansion; the Friends’ committee objected on the grounds that the analysis was inadequate. Nevertheless, a functions and catering plan for The Orangery and the upgraded café has been developed but not made public.
The Project Board pressed on with marketing the Small Mansion, and English Heritage paid for priority repairs to keep it watertight. The Friends’ committee wrote stating that the timing was poor, on the grounds that there would be far greater interest in a year’s time if Gunnersbury had won one or both of the Lottery bids. This point may have been borne out as only four parties actively registered an interest in the complex bidding process handled by Cushman & Wakefield – the school, a catering operation and two developers wanting to convert to flats. Despite requests, it has proved impossible to see the offer documents; they will only be shown to people who sign confidentiality and indemnity clauses. The GPJAP was told that the catering bidder withdrew during the process, and that only the school met all the criteria.