Revealed: The Plot To Sell Sugar

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“A decision to exit the business [of the Sugarhouse] was made in January based on additional accommodation plans, future capital requirements and the future student need.”

— Students’ Union Block Grant and Designate Funding Proposal, 2019

“I’m just writing to let you know, Trustee Board voted to sell Sugarhouse yesterday.”

— Unknown to Stuart Franklin, 23 August 2019

“There is a lot of ill feeling amongst the SU elected officers who are undoubtedly stirring it up.”

— Paul Morris to Andrew Burgess, 15 September 2019

SCAN has acquired a wealth of documentation on the sale of the Sugarhouse under the Freedom of Information Act 2000.

SCAN can now reveal that the Students’ Union, in collaboration with the University, has been plotting to sell the Sugarhouse since January this year. An offer was received in April and in October “the recent interest in the property” indicated a market value of “marginally under” £1 million. The SU has been engaging various commercial property agents to find buildings in Lancaster city centre that are suitable for “mixed leisure use” over the course of the last four years.

Key people

A number of people feature in the course of this article. For ease of reference, their names and roles are as follows (alphabetically):

  • Professor Dame Sue Black – Pro-Vice-Chancellor for Engagement
  • Andrew Burgess – University’s Director of Estates, Facilities and Commercial Services
  • Stuart Franklin – University’s Communications and Marketing Director
  • Claire Geddes – Chief Executive of Lancaster University Students’ Union
  • Jo Hardman – University’s Head of Commercial Services
  • Simon Jennings – University’s Director of Strategic Planning and Governance
  • Paul Morris – University’s Director of Capital Development and Estate Operations
  • George Nuttall – President of Lancaster University Students’ Union and Chair of the Trustee Board
  • Nicola Owen – University’s Chief Administrative Officer and Secretary
  • Sarah Randall-Paley – University’s Director of Finance
  • Victoria Tyrrell – University’s Head of Communications

The Students’ Union began operating the Sugarhouse nightclub in 1982…

…and in 1994 it purchased the freehold of the Sugarhouse site from Mitchells Brewery using a £220,000 loan provided by the University, according to a paper prepared by Simon Jennings in October. A condition of this loan was an entry on the title deed saying no disposition by the Students’ Union of the land was to be registered without the consent of University Council – it meant the SU could do nothing with the land without the University’s approval. In 1995/1996, the Students’ Union repaid the loan in full to the University and refinanced with NatWest, but the condition on the title deed remained.

In January this year, “a decision to exit the business [of the Sugarhouse] was made.” It was noted in the SU’s Block Grant and Designate Funding Proposal that the decision was made “due to changes in its operating circumstances, risks of noise complaints and the inflexibility of the venue to serve wider students’ needs.” As a result, informal negotiations began with developers.

By April, an “offer for a sale” had been received – according to an email sent by Claire Geddes to Sarah Randall-Paley. Geddes was also in talks with Andrew Burgess at this time. The involvement of senior University staff is evident throughout the process: the University is the “primary funder” of the SU (according to a paper by Simon Jennings) and all SU permanent staff are jointly employed by the University and Students’ Union. Geddes herself reports to Professor Dame Sue Black, the Pro-Vice-Chancellor for Engagement. Geddes noted the suggestion that the Trustee Board made two counter-offers: firstly, to ask for an off-market offer without the benefit of planning permission, and, secondly, entering into an overage agreement which would mean the developer would agree to pay extra in certain circumstances.

Claire Geddes to Sarah Randall-Paley

The Trustee Board, in their initial decision-making, agreed to support a transitional staff member to “develop alternative social offers,” and also to hire “professional communications support” to manage the messaging of the Students’ Union. The PR strategy was to be a key part of ‘mitigation’ – in case news of the decision to sell was leaked before it was actually sold. The PR strategist was also to devise press releases in case it got to the sale stage without a leak. It was also agreed that “the incoming officers should be brought on board but not until mid-next term/June.” Geddes added: “This aspect still feels like a political mine-field and I suspect that we are not going to come out of this without student dissatisfaction.

By May, the developers who had placed the offer had already begun “pre-planning discussions.” On 24 May, Paul Morris and Andrew Burgess visited the Sugarhouse. The nature of the visit is unknown, but it was added in an email: “Can we say we had a developers meeting and I invited you in for a tour should staff ask?”  Burgess later passed on his opinion that, having visited the site, the SU’s operation was “time limited”.

On 21 June, the Trustee Board met to review its options (just a handful of days before the new FTO team assumed their roles). Geddes told the University’s Communication and Consultation Meeting (CCM) that a “more substantial item” would come before them in July. The timeline at this point was:

  1. Mid-July: Revised offer to Trustees
  2. August: Trustees to vote on the sale
  3. September/October: Developer to apply for planning permission

On 10 July, Nicola Owen reported to Burgess that she “had started to give [Geddes] an indication that the University may be prepared to look at doing something collaboratively with them, but it would depend on what the SU regarded as red lines and what mutual benefit might be drawn.”  Geddes, similarly, spoke to the University Planning and Resources Group (UPRG) in July, requesting that they “consider how the University and the Students’ Union can work together to support a social and events calendar in the short-longer term and manage the risk to both organisations of an exit.” It was considered in this whether or not “at least one Roses Weekend big social nights could be re-sited to campus.” However, one briefing note prepared by Geddes on 15 July said: “The evening, late-night social provision would look very different.”

On 16 July, it was reported that “there has been a leak regarding the Sugarhouse discussions… to a small number of student staff at the Sugarhouse (thought to be 3).” The report continued, “If there was to be a widening of the leak, in the first instance, we would wish to speak to the Sugarhouse staff and then the Union staff before going out more publicly.”

A Students’ Union task group investigated several “key risks” to the sale that formed part of Geddes’ report to the UPRG in July. Concerns were raised that it would mean a loss of a venue for key “social events/rights of passage,” that it would lead to a “reduction of influence in the city regarding student needs and in particular safety,” and that it would impact on “the ability of the Students’ Union to deliver existing social activity.” It was noted that Sugarhouse staff resources contributed to the running of events like Extravs. Perhaps the most important risk so far as the University was concerned was that the sale could “further lower” the Students’ Union’s National Student Survey (NSS) score and therefore negatively impact the University too.

An “updated financial offer” was expected by the Trustees on 16 August, with an extraordinary Trustee Board meeting planned for 22 August to vote on this. On 23 August, it was said in an email: “Trustee Board voted to sell Sugarhouse yesterday.” On 30 August,  Geddes held an “unpacking session” with the “team,” noting that it was the “first time we could get 5/6 together,” likely referring to the Full Time Officer team, several of whom were dissatisfied with the result.

The Tab Lancaster got in contact with the Students’ Union on 6 September to tell them they knew about the sale. Geddes wrote to Morris and Jo Hardman, noting “the position regarding the Sugarhouse offer has been leaked to the press and we have no alternative but to state our current position.” Geddes added: “I wanted to make you aware in advance as you’ve all supported us so fantastically over a considerable period.”

Victoria Tyrrell communicated to a group of senior managers, including then-Vice-Chancellor Mark E. Smith, the feeling on social media about the sale: “The comments are mostly about it being the best/only safe space for students to enjoy in Lancaster. I’ve seen a couple that confuse SU with the University but most are aimed at LUSU. #saveoursugarhouse is gaining traction. A couple of people have tweeted at James May and Andy Serkis asking them to support it.” The same day, a petition had gone up on the Students’ Union website protesting the sale. This was similarly met with dismay from a University employee: “No! Going to be hard to ignore the petition. People are saying how out of touch LUSU are. They will get a hammering in NSS and that will affect uni.

Professor Dame Sue Black, in an email to Morris, noted on 8 September that “I think that next week we are likely to take some heat locally because of the SugarHouse issue and as there will be mention of selling the property and replacing in part with affordable housing.” This concern was validated on 12 September when the Lancaster Guardian ran an article on whether the £400,000 of soundproofing by CityBlock was now “wasted.” One University employee lamented “City Councillor comments have moved this story on a little in the local media.” Morris complained in one email, “I do consider the article is at best one-sided and possibly inaccurate!”

On 15 September, Morris wrote to Burgess, expressing his frustration about the FTOs: “There is a lot of ill feeling amongst the SU elected officers who are undoubtedly stirring it up.” This frustration followed a panic that the sale figure was “in the public domain” and a concern that “we think the Tab will publish something.” Morris suggested that he take the FTOs to look at alternative properties, to get them “looking forward and not back.” On 17 September, Simon Jennings noted in an email “The SU are not at the point of a sale agreement as I understand things but hope to be so soon.”

On 20 September, George Nuttall brought an item on the Sugarhouse to University Council. He informed them that “in accordance with the Student Union’s constitutional arrangements there would be a referendum over the decision to sell the Sugarhouse, as a result of petition numbers against the proposal.” Nuttall also informed Council that the Students’ Union was working with the University to explore alternative options, and the University was clarifying its position in relation to historic Students’ Union financial support.

The title deed condition imposed on the Sugarhouse in 1994 had come back to frustrate the sale process. In an email on 1 October to Lord Liddle (Pro-Chancellor and Chair of University Council) and Valerie Young (lay member of University Council), Nicola Owen explained that in order to lift the restriction it could go to the Trustee Board on 11 October, and then be delegated to the University’s Finance and General Purposes Committee (FGPC) on 25 October for a final decision. Owen explained, “there is a risk that this provides the Council with a control over another organisations assets which is inappropriate in governance terms and with respect to charitable responsibilities.”

The same day that George spoke to University Council, Geddes wrote to Burgess, Owen, and Dame Sue Black, “In terms of Sugarhouse, I understand from George that the proposal from some of the Officer Trustees on the 11 October is to be to suspend any further action regarding the sugarhouse negotiations with the developer until the democratic processes have been completed. Whichever way this discussion plays out this is likely to create further challenges.”

Since the start of October, the Union has held its Annual General Meeting (AGM), where students overwhelmingly approved motions to halt the sale of the Sugarhouse. The sale is suspended now, per the 11 October Trustee meeting (though this was only announced on 25 October). Students and staff await the outcome of the ‘Save Our Sugarhouse’ referendum in Week 8.

SCAN will continue to provide updates about the sale of the Sugarhouse as the story develops.

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