The International Finance Centre: the questions the JEP wants answered

The JEP puts a series of key questions to senior ministers and those leading the project.

THE enduring furore over plans to build six office blocks on the Esplanade car park is a mixture of genuine public concerns about the plans, rival developers’ attempts to do down a competitor and confusion over what is on offer and how it is going to be realised.

Public negativity towards the plans has, perhaps, been fuelled by the length of time taken to get going with the scheme.

It has also not helped that the project, and overriding ‘Esplanade Quarter Masterplan’ to develop the wider area, has gone through a number of revisions, swapping hands between different organisations.

• Part of the Esplanade car park is due to be handed over to building contractors Camerons Ltd on 22 June so that development can begin.
• The Corporate Services Scrutiny Panel, which is continuing its review, is due to hold a hearing with Treasury Minister Alan Maclean on Monday.
• The JDC recently announced it had interest from another potential tenant in a further 5,000 sq ft of office space and will continue to seek clients.
• On Tuesday the States is due to debate a proposition lodged by Deputy Montfort Tadier calling for work on the scheme to halt until the result of scrutiny’s review are published. If approved in its amended form it could also mean the Council of Ministers has to present plans for the JIFC for the States approval before the project restarts.

What remains clear, however, is that Islanders do not feel they have had enough information about the plans, which the States and States-owned Jersey Development Company have been quick to progress in recent weeks.

Around 2,000 people stood side-by-side around the proposed finance centre last Sunday to try to convince politicians to wait for the results of scrutiny’s investigation of the project, which is due for publication in the coming months.

Ahead of that protest, however, the JDC proudly announced it had secured its first tenant – Swiss investment bank UBS, which has agreed to lease around 25 per cent of the finance centre’s first building.

Senior ministers went on to confirm that the leasing of 16,350 sq ft of office space was sufficient to trigger the start of development, but Islanders have since questioned the States position on the level of pre-lease agreements needed before building could begin.

Those behind the project, including Chief Minister Ian Gorst and Treasury Minister Alan Maclean, joined project leaders this week to answer questions from the public about the plans.

After discussing the project at the Town Hall on Wednesday night Islanders still appeared dissatisfied with the information provided.

But how have we got to this point?

In 2008 the States approved the Esplanade Quarter Masterplan, which set the framework for developing the Esplanade and reclaimed land nearby.

The Jersey International Finance Centre represents the first phase of that plan and comprises the building of six large office blocks, several areas of community space and an underground public car park.

At one point this part of the scheme was going to be delivered in one fell swoop, but ministers later decided to phase the building of the finance centre in response to demand in order to minimise the commercial risk of the development.

And according to developers the flagship centre should, if things go to plan, provide a £50 million return to the public purse.

A key part of the wider scheme involves sinking Route de la Libération to create more land to develop other parts of the Masterplan – accommodation, a hotel and more public space.

To maintain the route’s link to St Helier, an underground tunnel and roundabout would be built as part of that phase.

Serious doubts remain, however, over the viability of the scheme.

• If there is demand for only two or three buildings at the JIFC, what will become of the rest of the space?
• Much has been made of the creation of a new public underground car park, how many buildings are needed to fund this part of the scheme?
• Could the private sector meet the current demand for office space – if so for how long could this continue to be the case?
• We are told that the success of the project will result in a £50 million return in 20-30 years. What does success look like in two, five and ten years’ time assuming the project runs to plan?
• Why not wait for scrutiny’s independent ‘Red Book’ valuation of the scheme and accompanying report?
• What action will be taken if scrutiny’s report does not match the projections of the JDC and the claimed £50 million return?
• If such demand for grade A offices truly exists why not advance on a ‘fully let’ basis?
• If the £50 million return from the project is not realised for 20 years, what will the dividend be worth adjusted for inflation?
• Can assurances be given that Route de la Libération will be lowered as per the approved Masterplan?
• If no more lettings are achieved for the JIFC’s first building, what is the expected profit/loss of the sale of the unit after the bank loan has been paid off?