A significant land acquisition by Manchester City Council for a flagship government hub has been challenged, with a barrister claiming the deal was "unlawful." The development, intended to be part of a broader initiative to decentralize power from Westminster, could face immediate setbacks due to allegations of procedural breaches during the 2017 purchase of the former Central Retail Park site.
Christopher Knight KC, representing property mogul Aubrey Weis, asserts that Manchester City Council violated legal rules twice before acquiring the 10.5-acre site for £35 million. This site is slated to become the location for the new £2.3 billion 'Digital Campus,' which will include a Northern office for the Prime Minister's office, dubbed 'No. 10 North,' and is projected to house 7,000 civil servants by 2032.
Knight's legal opinion suggests that the Greater Manchester Combined Authority (GMCA), which oversaw the deal and was previously led by Andy Burnham, failed to comply with regulations requiring a formal valuation report before making an offer to the previous owner, TH Real Estate. Knight noted this acquisition was reportedly the most expensive land purchase by the council for an inner-city site.
A second alleged breach concerns the failure to inform council members of another offer for the site's freehold, which was owned by Manchester City Council. Property consultant Metis, acting on behalf of developer Cole Waterhouse, had reportedly made this offer. According to Knight, the report presented to councillors in September 2017 proposing the leasehold acquisition did not mention Metis's offer. Knight stated this omission was unlawful, as it prevented the council from considering all relevant factors before exercising its fiduciary duty.
Knight also pointed to a September 2017 report by property consultant Jonathan Bernstein, son of the then Manchester City Council chief executive Sir Howard Bernstein. This report valued the retail park at £33 million for commercial use and between £25 million and £30 million for residential use. However, the land's value was later assessed at £27 million in 2022 after a proposed development was shelved, leading to accusations of a significant overpayment by the council.
The legal challenge arises as Andy Burnham promotes the 'No. 10 North' project as a key element in rebalancing power across the country. He recently stated that such initiatives create a sense of a more balanced nation where significant actions can originate from outside the capital.
The timeframe for formally challenging the property deal has elapsed, as the six-year period concluded in 2023. Aubrey Weis, the property mogul behind the challenge, is currently involved in separate legal proceedings against the GMCA concerning preferential loan rates provided to another developer. While his claim regarding those loans was recently dismissed by the Court of Appeal, he is reportedly preparing a final appeal to the Supreme Court.
A spokesperson for Manchester City Council stated that the acquisition of the Central Retail Park site was intended to complement the regeneration of the area. The council disagrees with the opinion presented regarding the acquisition, asserting that the decision was not challenged and the price reflects the value of a significant retail site and a key regeneration opportunity. The council added that the cost was agreed upon with the expectation of recovery through long-term development of the site. The GMCA and Downing Street were contacted for comment.