Margate’s historic Harbour Arm is being leased by its owners, Thanet District Council (TDC), to local businessman Mr Graham Knight, for £1 a year.
The lease was granted to Mr Knight, via his company Pineapple Properties (Kent) Limited, in 2008. In 2014 the lease was renewed until 2021. This time to another Knight owned company, The Margate Harbour Arm Company. It is understood that this lease was not subject to any form of competitive bidding.
When taking on the lease in 2008 Knight was awarded a grant from TDC, of £150,000 to refurbish the buildings on the pier It is believed that this grant was supplemented by further grants from the European Union and possibly Kent County Council to cover the costs of the improvement works. I can find no evidence of how much money Mr Knight personally invested in the improvement works to the Harbour Arm
There are now 2 bars, 2 restaurants, 2 cafes, 2 artist studios an art gallery and fisherman’s lock up operating from the pier. The pier is now an extremely popular social hub for visitors and locals. Mr Knight, as the leaseholder, receives the rents from all of the businesses on the pier. In addition there are 41 car parking spaces on the pier. Mr Knight receives the income from these parking spaces as well.
I have estimated that in exchange for paying £1 a year rental, Mr Knight receives an annual income of almost £150,000 from the pier based business and the car parking spaces (see below).
|Car Parking Fees. There are 41 car parking spaces on the Harbour Arm. Assuming an occupancy rate of 25 spaces for an average of 4 hours per day 360 days per year at average payment of £7.00||£63,000|
|Rental income from 2 bars, 2 restaurants, 2 cafes, 1 art gallery, 2 artist studios, fishing lock up. Assuming an average monthly rental income of £700 per property = £6,300 per month||£75,600|
This is a conservative estimate and its quite possible that Mr Knight receives much more. But even allowing for the insurance policies, the cleaning and maintenance works which Mr Knight is required to do as part of his lease, it’s very probable that in exchange for £1 a year rent, he makes at least £100,000 profit! Mr Knight is a very, very, lucky man to have this incredible gold-plated lease.
I have also discovered that last year TDC paid £14,900 for electricity supplied to the pier and that Knight and the Harbour Arm businesses appear not to have been charged for their electricity usage. I assume that this free electricity arrangement has been in place throughout the life of the 2 leases and I also believe that the water supply to the pier-based businesses is also paid for by TDC.
A single toilet block serves the entire pier, its businesses and visitors. It is cleaned, maintained and repaired by TDC with no contribution from Knight or the pier businesses. Following a tragic death 3 years ago and several serious accidents, railings are now in the process of being fitted along the length of the pier edge. The cost of these works is £100,000. However Mr Knight and the pier businesses have not been asked by TDC to contribute towards the cost of these essential safety works.
There must be an enquiry into why Mr Knight was granted such a generous lease and why this lease appears not to have been subject to competitive tendering when it was renewed in 2014. The Local Government Act 1972 requires Thanet Council to secure the best consideration for property disposals, which includes leasehold disposals, Clearly, in this case, the best consideration was not secured and literally £100s of thousands of income has been lost to TDC which is already seriously cash-strapped. The council tax-payers of Thanet have also been forced to pay out £10s of thousands every year covering the costs water and electricity supplies, toilets and urgent safety works, which should, in my opinion, have been paid for by Mr Knight and the pier-based businesses who all directly benefited this civic generosity.
It’s hard to believe that a council which is rumoured to be considering making £2million worth of budget cuts next year, which may include staff redundancies, is happy to waste massive sums of public money through its unbelievably stupid giveaway lease for the £1-A-Year Seaside Pier