Stoke-on-Trent sells shares in regeneration company

A council has sold its shares in a long-standing Stoke-on-Trent development company for £5 million – but critics say it is a bad deal for the city. Stoke-on-Trent City Council has sold its 19 per cent stake in Stoke-on-Trent Regeneration Limited, a joint venture with St Modwen launched in 1993.

While St Modwen has paid the cash-strapped council millions of pounds for its shares, the deal now leaves the developer in full control of several sites owned by Stoke-on-Trent Regeneration Ltd – including parts of Berryhill Fields. This has led to increased fears that hundreds of homes could be built on these green spaces, with the council potentially unable to prevent this.

The city council says that it was a ‘sensible time’ to sell the shares due to the current economic conditions, and that the decision was taken following independent advice.

Cabinet members at the Labour-led authority agreed to the sale of the shares in December, in a behind-closed-doors meeting. The deal has now been finalised, after opposition Conservative councillors failed to force a rethink. The Conservative group says that the council should have asked for the land owned by the company, instead of a cash payment.

Stoke-on-Trent Regeneration Ltd’s property portfolio includes much of the land at Berryhill Fields which was previously earmarked for up to 1,300 homes. This site, near Eaton Park and formally known as ‘land at Staffordshire House and Berry Hill Road’, was acquired by Stoke-on-Trent Regeneration Ltd in 1997.

While Berryhill Fields was assessed as being not ‘currently viable’ for development in 2020, Conservative group leader Dan Jellyman says this could change due to a new housing land assessment being carried out by the council.

Mr Jellyman believes that the value of Berryhill Fields and other sites owned by the company will rocket if they are earmarked for housing in Stoke-on-Trent’s forthcoming local plan – with the council no longer having any control over them.

He said: “Our view is that £5 million is going to look like peanuts. The land is going to be worth a lot more than that now that it’s under the full control of a property developer. The council should have walked away with control of these sites. They should either have asked for the transfer of the land from St Modwen, or for a covenant to be placed on the sites so they can’t be developed.

“I’m not criticising St Modwen – they’re a business and their aim is to make money for their shareholders. But they’re obviously going to want to develop these sites – they’re not just going to sit on them, in perpetuity, like the council would do.”

Stoke-on-Trent Regeneration Ltd has been involved in a number of major developments across Stoke-on-Trent, including Etruria Valley, but talks about winding up the company had been ongoing for years.

The company’s latest published accounts show that it had net assets worth £29.1 million at the end of 2022, down from £32.7 million in 2021. The city council’s accounts for 2022/23 valued the authority’s stake in Stoke-on-Trent Regeneration Limited at £4.974 million.

Stoke-on-Trent Regeneration Ltd previously owned a parcel of land to the south of Berryhill Fields, known as Fenton Fields, but this was sold to local businessman Jonathan James for £1.2 million in 2021. At the time Mr James said he had bought the land to save it from development.

Campaigners have been fighting to protect Berryhill Fields for years, ever since it was earmarked for housing under previous local plan proposals.

They fear that the council’s sale of its shares in Stoke-on-Trent Regeneration Ltd will make their fight that much harder.

Dave Burgess, vice-chairman of the Save Berryhill Fields Action Group, wants the council to complete its local plan as soon as possible – with Berryhill Fields left out of it.

He said: “At the 2019 and 2023 local elections, Conservative and also Labour candidates pledged to get Berryhill Fields removed from the ‘final draft local plan. Despite having six years to produce the government-required local plan, Stoke-on-Trent City Council failed to meet the December 2023 deadline – why?

“The council’s own Brownfield Register 2020 indicates that 8,397 new homes could be built on derelict/ previously developed and unsightly sites throughout the city, without touching any of the green spaces

“People are highly suspicious of the relationship between the council, Stoke-on-Trent Regeneration Ltd and St Modwen.”

A spokesperson for Stoke-on-Trent City Council said: “On March 13, 2024, Stoke-on-Trent City Council disposed of its 19 per cent shareholding in Stoke-on-Trent Regeneration Ltd. Through Stoke-on-Trent Regeneration Ltd the council has supported the development of a number of sites across the city, including sites across Etruria Valley, that have led to significant job creation. The council has now taken the decision based on current economic conditions, independent advice and valuation, that this is a sensible time to sell its shares in the company. The value received was £5m.

“In undertaking the required due diligence the city council took independent professional advice which considered all aspects of the sale. This advice indicated that the sale price was appropriate based on number of factors and the city council does not agree with the speculative opinions being expressed that the shares were sold cheaply or below value. 

“Any development put forward within the city would be considered through our usual planning processes, subject to planning control and would be considered against the relevant local and national planning policies and guidance. This has always been the legal position and the decision to sell the shares does not change this.”

St Modwen has been approached for comment.