Asset management strategy

Asset management - a strategic approach

The borough of Newcastle-under-Lyme is part of the conurbation of North Staffordshire. It is the most populated district in Staffordshire with a population of around 125,000 and has an area of 81 square miles. The two main towns within the borough are Newcastle-under-Lyme and Kidsgrove and there is an extensive rural area to the west/south-west of the urban area.

The industrial base of the borough has changed significantly in the last century, with the closure of local coal mines and the development of the distribution sector. Service industries are the largest employers in the area, with the number of people employed in water, energy and construction industries being higher than average. The presence of Keele University with the development of its innovation centres for small businesses, new medical school and the growth in hi-tech, research and medical technology businesses demonstrates the potential for added value growth of the area. Newcastle town centre is recognised as being one of two strategically important centres in the North Staffordshire conurbation, with further growth predicated upon its good connections to major transport routes.

There have been big reductions in funding provided to local authorities, central government and its agencies, arising from the need to restrain public expenditure to rebalance public finances following the global economic recession beginning with the banking crisis in 2008. Services remain under pressure to reduce costs and to keep fixed outgoings such as property related costs under review. At the same time, our own resources available to finance capital projects have diminished and need replenishing before any substantial further capital investments can be made. Several years ago, in response to this requirement, we initiated an assets disposal programme demonstrating a more concerted effort to dispose of land/property which it no longer required. In the past twelve months this position has been refined in a corporate context whereby the Cabinet has resolved that future capital programmes should be funded as a first resort from asset disposals.

Main elements of good estate management

The main elements of good asset management for public authorities are:

  • leadership - political, corporate and technical
  • culture - establishing an environment that sets high standards and measures performance
  • strong customer focus - consultation and feedback undertaken in the context of wider public interest
  • clarity of structure, roles and responsibilities
  • resources and capacity - adequate staff, time and funding
  • clear governance - support of senior management and political leadership
  • data - decisions should be properly informed
  • sustainability - outcomes are sustainable organisationally, environmentally and financially

In order to facilitate good asset management it is also necessary to design a process that can be readily understood by all interested parties and, most importantly, be clear to those involved with administering it. We propose to continue with a five stage process for asset management.


This is:

  • understanding community needs and those of our partner organisations
  • corporate and political policies and priorities
  • service delivery and financial strategies

The strategy seeks to clarify our approach to asset management, particularly balancing the corporate context with service delivery requirements.


The programmes of work should be derived from the strategy and these will typically relate to investment in retained stock and disposal of property where there is no evidence of strategic or operational service need to keep it.

  • analysis of current performance and future needs, including:
    • property audit to understand current performance and trends
    • options appraisal and prioritisation


Delivery of agreed programmes is the vital ingredient that translates the strategy into action and recent experiences of property disposals demonstrate the importance of good project management.

  • delivery planning
  • project management procurement


Continual review is a key element of the process too in order to ensure that the property estate continues to support efficient service delivery.

  • has the change delivered the expected outcomes?
  • how are services performing?


The latter should lead into improvement planning in order to ensure that any change in direction in corporate priorities can be responded to.

  • what are the corporate drivers for further change?
  • what are the challenges and opportunities now facing services?

Benefits of good asset management

These are:

  • improved services through better buildings and co-location of services
  • improvements in efficiency, which generate financial savings
  • reduced maintenance backlog
  • better utilisation of property
  • release of capital through sale of surplus assets
  • potential to drive regeneration outcomes both economic and housing growth

Asset management in practice

Office rationalisation programme

At the time of writing this strategy, we agreed to relocate from our main office headquarters (in Merrial Street) to facilitate a comprehensive retail-led regeneration scheme. During the following 12 months the necessity, deliverability and affordability of this project was further assessed. In the meantime we continued to review our office accommodation in Newcastle town centre and as a result, consolidated our staff in a more space efficient manner within the civic offices to free up space which has been let to other public sector partner organisations which include the Staffordshire and Stoke-on-Trent NHS Partnership Trust, Staffordshire County Council and Staffordshire Police. This has produced:

  • a significant annual revenue income
  • a reduction in running costs to us
  • a reduction of carbon emissions from us
  • improved partnership working
  • potential to deliver more seamless public services

Depot review

We continue to review our depot facility following the rationalisation of the overall site which enabled the Staffordshire Fire and Rescue Service to build a new community fire station on surplus land. Office staff moved to the depot from the civic offices to free up space which is being let to Staffordshire and Stoke-on-Trent NHS Partnership Trust. More importantly, over the next 12 months was the need to undertake a more fundamental review of the depot premises in order to accommodate the delivery of an enhanced waste and recycling service from mid-2016. The necessary premises alterations were completed in January 2016. Our owned land opposite the depot on Silverdale Road has been identified as a possible requirement for operational purposes to support the planned reconfiguration at the depot.

Green space strategy

In 2005 we (in partnership with Stoke-on-Trent City Council) adopted a green space strategy which covers the urban areas of the borough and the city. This assesses the needs of the community to ensure that it is adopting the right approach to green space provision, management and maintenance. There is also a rural green space strategy which relates to the rural areas of the borough.

We have agreed to review and update these strategies over the next year or so in line with changes to national policy, local government finance and projected resources. This will be used to inform the review of the local plan.

Playing pitch strategy

A playing pitch strategy (PPS) was commissioned and was completed soon after approval of this strategy. At the time of preparing this asset management strategy, the draft PPS has identified some sites where there is no local demand thereby rendering them suitable and appropriate for alternative use or development.

The above strategies seek to prioritise and direct resources into the areas which provide the greatest benefit to the community and to identify areas where disinvestment, change of use or disposal may be appropriate.

Developing a clear property strategy

Scale of activities

We are a significant property owner within its administrative boundaries with substantial legacies around the two main town centres of Newcastle and Kidsgrove as well as in the urban villages/rural hinterland.

As of March 2014, our property assets were recorded in the asset register at a value of just under £72.4 million. The properties are valued in accordance with RICS appraisal and valuation standards ('red book'). This involves a variety of valuation methods dependent upon the particular asset and its use. This estate comprises a mix of property:

  • some 220 buildings
  • various land holdings which form two distinct portfolios:
    • the commercial/regeneration portfolio
    • the operational portfolio

See the section on the current estate.

Operational portfolio

This consists of land and buildings from which we carry out our own business activities and service delivery. This comprises a mix of 100 buildings that are typical of a local authority estate and result from the history of diverse activities in which local authorities have been involved in the past.

Examples of the existing operational properties include:

  • Jubilee2 health and wellbeing centre
  • the Civic Offices (the main office headquarters)
  • the works depot (which provides workshops, stores and garaging for our direct works departments)

The primary objective of the operational stock is to ensure that it remains fit for purpose. So the condition of the properties is kept under review and essential maintenance is prioritised accordingly. From time to time it will become evident that properties have reached the end of their natural life – i.e. when the property is uneconomical to repair in order to fulfil the service needs. The Jubilee 2 development was predicated upon a business case that demonstrated, amongst other things, the necessity to replace two out-dated premises. A similar situation is developing at Kidsgrove where the current leisure centre is now in need of replacement. At the time of writing, Cabinet had agreed to consider the inclusion of such a scheme in the preparation of a future capital programme.

We no longer hold social housing stock but still own and maintain significant land holdings within these neighbourhoods. This land is kept under review and presents opportunities for alternative use or development in liaison with the stock-transfer company, Aspire Housing.

We own and manage approximately 1800 acres of land for the purpose of providing parks, gardens, outdoor sports facilities, children's playgrounds, local nature reserves, woodlands, allotments, cemeteries, footpaths and cycle ways for the benefit and enjoyment of the public. The strategic context of the use of these spaces is provided in the green space strategy or other key strategies.

Commercial portfolio

This comprises land and buildings let to business tenants on the basis of open market rents, as well as our fee-paying car parks. Whilst the basic approach to the commercial portfolio lettings is market-driven there may be occasions where our economic regeneration objectives influence this position. Any such adjustment to purely market-led criteria has to be approached with caution to avoid distorting the market and creating a spiral of decline in investor confidence. A commonly used approach, particularly in difficult economic conditions, is to incentivise prospective tenants with rent-free periods, where necessary, as opposed to reducing market rental levels. However, particularly in the retail sector, there have been some rent reductions in line with current market evidence. It is intended that this practice will continue for the foreseeable future in order to both promote economic growth and to optimise rental income.

This portfolio comprises 120 freehold buildings and 13 leasehold units:

  • town centre premises including retail, office and leisure uses
  • a number of premises on industrial estates

There are also street markets and hybrid premises (operational properties which have an element of commercially let space within them), such as the lettings of part of the civic offices to public sector partners.

The portfolio itself has arisen out of various regeneration initiatives that we have undertaken from the 1930s onwards when we undertook the development of the Lancaster Building shops and office complex at the time of an economic depression. In response to the recent weak global economic conditions, we invested significantly in this listed building through a comprehensive refurbishment to achieve a 'very good' BREEAM standard. The offices are now fully let.

In recent years, additions to this portfolio have included the construction of a small block of industrial units for the small business/new enterprise market at Church Lane (Knutton) which are now fully let. Additionally, we facilitated the development of a BREEAM 'outstanding' commercial building at Chatterley Valley, known as Blue Planet, on land which we held as a result of an intervention in the market to deal with a heavily contaminated parcel of land. These premises have been successfully let to JCB who are operating their world logistics hub from the site. JCB also have an option to purchase adjacent council-owned land which would facilitate future expansion on this site.

Asset management policies

These will be influenced by various factors including:

  • current government policy
  • the needs of the community
  • the needs of the organisation in delivering services and economic conditions

Taking account of these, our key policies for asset management are as follows:

  • we will only hold sufficient property to meet a service need or strategic objective
  • property is a corporate asset and will be managed as such
  • service demands on the estate will be met in the most cost effective manner available to us
  • properties held for service needs will be suitable for their intended purpose
  • the condition of our estate will be maintained at the best possible level to meet the needs of the operational activities (taking account of available resources) with best endeavours being used to optimise the environmental performance of all properties

Property-related asset management objectives

In the context provided above it is appropriate that we have clear objectives relating to the use of its property assets and these are summarised below:

  • to facilitate and contribute to the achievement of corporate priorities and objectives
  • to support service delivery requirements
  • to optimise capital receipts from disposal of surplus land or property to provide funds for capital programme expenditure
  • to achieve optimum utilisation of property assets
  • to optimise income from the commercial portfolio
  • to invest available funding in areas of greatest need or opportunity (including essential maintenance and repair)
  • to demonstrate the efficient use of resources on land and property owned by us
  • to minimise the opportunity cost of holding land and property assets
  • to keep the property portfolio under review (at least annually) with the aim of disposing of land or property for which there is no strategic, financial, operational or other public interest reason for retention
  • to minimise any adverse environmental impacts of the portfolio
  • to engage with local community and third sector organisations to optimise the effective and efficient use of community assets