Liverpool takes Festival Gardens back to drawing board

Ion Developments had signed an exclusivity agreement to build 1,500 homes on a 22-acre chunk of the site but the city council has decided to launch a fresh hunt for a development partner after the agreement expired.

Liverpool City Council’s cabinet will meet next week to approve a recommendation to start the procurement process for a development partner on the Festival Gardens job, four years after Ion became involved with the scheme.

The council anticipates it will launch the search for a developer in early 2023.

The recommendation to procure a development partner follows a year-long review of the site, the council said.

It is hoped the fresh approach will ensure the project comes forward in line with the council’s recently adopted local plan, council plan and the mayoral triple lock policy – aimed at bolstering decision-making processes within the authority following the damning Max Caller report.

Cllr Sarah Doyle, Liverpool City Council’s cabinet member for development and economy, said: “The city council is now at a critical stage in establishing how this site will progress. Given its strategic importance to our housing programme, it is only right and proper that a major review of our approach was undertaken to ensure it aligns with all the new policies we’ve adopted since our new mayor was elected.

“Now that that review is complete a clear programme has been set out to shape its future direction. If approved, this procurement process will mean adding a year to the original timescales but given the site lay dormant for a quarter of a century our focus is on getting this right, as this scheme will be a home for a whole community for the rest of this century.”

The procurement process would be funded by the council’s existing capital programme and Ion will also be invited to submit a bid.

A spokesperson for Ion Developments said: “We are obviously very disappointed by this approach, particularly given that the council has confirmed on numerous occasions that our performance on the project is not in question and the fact that we have worked seamlessly with the council’s regeneration team to progress the project since our involvement commenced some four and a half years ago.

“We expect to commence formal discussions with the council in the near future to establish how our contribution to date will be recognised and to agree a way that our considerable knowledge can be used to assist with the successful delivery of this important site.”

Scroll down for Ion’s full statement

Once a partner is on board, work to deliver the housing project could begin in 2025, subject to planning approval, the city council said.

Vinci Construction is currently remediating the former landfill site – which once formed part of the International Garden Festival celebrations launched by Queen Elizabeth II in 1984 – and it has transpired that the excavation works need to go deeper than previously thought.

The cost of the additional remediation work is yet to be determined. The package of enabling work was initially anticipated to cost £45m, with funding coming from Liverpool City Council, Liverpool City Region Combined Authority and Homes England.

However, the LCRCA funding is conditional on the city council signing a developer agreement for the Festival Gardens project, meaning some of the funding is currently being withheld.

“The transformation of this site has been a mammoth undertaking and we have worked very closely with contractors to ensure the surrounding communities have been kept up-to-date every step of the way,” Doyle said. 

“It’s not a surprise given the sheer scale of the site that the excavation has surpassed what was originally estimated and costed. But whatever the additional costs will be, they will be dwarfed by the long-term economic impact for the city and the millions in revenue that will be generated by the council tax income which we can invest in our front line services.”

Ion Developments’ statement

We understand that officers have made this recommendation to members based upon a belief that there is an unresolvable technical issue in the original developer bidding process which would prevent the use of the previously agreed legal structure and documentation.

Unfortunately, the council has not shared its legal advice in relation to this purported issue, which does concern us, and makes us question both its validity and the motivation behind the recommendation.

We are obviously very disappointed by this approach, particularly given that the council has confirmed on numerous occasions that our performance on the project is not in question and the fact that we have worked seamlessly with the council’s regeneration team to progress the project since our involvement commenced some four and a half years ago.

The council has derived considerable benefit from our involvement in the project including the use of our design and technical information to secure circa £30 million in grant funding. This information has also been used to progress the remediation to date, including the adoption of our masterplan and design specification, upon which the works are based.

This has involved a huge amount of work and expenditure on our part, using our excellent Liverpool-based design team.

Clearly, the council is undergoing a period of upheaval and it would appear from our point of view that this recommendation is directly related to the desire of the council and the commissioners to demonstrate that changes are taking place.

We expect to commence formal discussions with the council in the near future to establish how our contribution to date will be recognised and to agree a way that our considerable knowledge can be used to assist with the successful delivery of this important site.

Hopefully, such an approach will resolve the matter without recourse to litigation.