Agenda item

7.2

AGENDA ITEM 10: THE SHEFFIELD INVESTMENT FUND

7.2.1

The Executive Director, Resources, submitted a report setting out how the City Council might lead a strategic and innovative approach to the use of its property asset base to develop an Investment Fund, namely, ‘The Sheffield Investment Fund’. The ultimate objective and targeted output of the Fund would be to assist in the regeneration and sustainable growth of the local economy with associated benefits to the workforce and people of Sheffield.

7.2.2

RESOLVED: That Cabinet :-

(a)

to the establishment of  the Sheffield Investment Fund as outlined in the report now submitted; and

(b)

delegates authority to the Executive Director, Resources, in consultation with the Cabinet Member for Finance and Resources and the Director of Legal Services to :-

(i)

establish the fund through the capital programme on the basis that the fund will not normally be for “gap” funding, but will be for investment purposes, generating a cash return on the investment with a payback of the capital at the end of the term of the investment;

(ii)

establish an appropriate governance structure;

(iii)

establish the Fund’s Investment Strategy, project selection process and linkage, where appropriate, to the Sheffield City Region Investment Fund;

(iv)

agree the procurement strategy and award if it is determined that the best way of delivering the output is by creating a special purpose vehicle or entering into a joint venture;

(v)

negotiate, agree and complete the legal agreements required to give effect to the above arrangements; and

(vi)

make any other decision required to enable the creation and operation of the Sheffield Investment Fund including the use of a Fund Manager, where deemed appropriate, as procured for the South Yorkshire Urban Development Fund.

7.2.3

Reasons for Decision

The underlying benefit of this proposal is that it utilises the Council’s asset base in a measured way to assist economic growth and progress in the City where, but for the appropriate funding being available, there are viable projects that can help to deliver jobs and other economic activity.

It is proposed that through the Capital Programme Approval process, including subsequent Cabinet approvals, the Council establishes the Sheffield Investment Fund to help progress the priorities of the Corporate Plan

7.2.4

Alternatives Considered and Rejected

The alternative option would be not to create an investment fund to assist economic growth using our own asset base as a source of funds and to leave such matters to the market.

The current economic conditions and restrictions on the availability of bank finance mean that projects that are otherwise viable are stalled due to that lack of funding and that is the state of the current market.

We could restrict our activity of investment in such projects to the South Yorkshire Development Fund. However, the creation of a Sheffield Investment Fund would be complimentary to other funds created in the region, and would be focussed on Sheffield.