In 2015 ELS advised on a number of academy conversions in Essex which involved nursery premises
The conversion of schools to academies is not always straightforward, particularly in relation to sites which are shared between the school and day/pre-school nurseries. The deadlines for conversions are usually very tight and can require detailed involvement with the Department for Education.
ELS has recently dealt with an academy conversion involving a school site which included nursery premises let to a third party who had received Sure Start funding for the nursery. The Sure Start funding was subject to a claw-back of funding in the event that the nursery premises were to be used for any alternative purpose within a specific timescale. As provision could not be made in the commercial agreement to comply with the funding terms, the position of Essex County Council needed to be protected should the nursery lease end or the site no longer be used as a nursery. There was a risk that the council could be exposed to a potential financial liability or be in breach of its statutory duty to provide Early Years services in the area.
As Essex County Council is the freehold owner of the site, ELS dealt with the grant of a 125 year lease to the academy company. ELS ensured the lease to the academy included wording to protect the council against any potential funding claw-back and secured an ongoing childcare provision in a more rural area of Essex throughout the term of the 125 year lease to comply with the council’s statutory obligations. ELS negotiated to restrict the permitted use of the nursery land in the lease and to specify the age range and number of children that the service must be provided for. It also ensured that, if the lease to the current nursery provider was ever terminated or if it expired, the nursery site would revert to Essex County Council in the event that the academy failed to either run the nursery themselves or complete a lease within a set period with another provider to continue the nursery. This still left a period where claw-back could be demanded and ELS required that a "tenancy at will" be granted back to Essex County Council immediately upon termination of the current lease to the nursery provider so that during any such gap in service provision the council could set up a pop-up provision for childcare in the area.
In dealing with this matter ELS demonstrated the ability to understand and implement our client’s requirements by ensuring that if the academy fail to provide the service required, the relevant land will revert to Essex County Council and be re-let or the council would provide the Early Years service itself. In addition, if Essex County Council was ever exposed to a potential financial claw-back then, again, the land could revert back to the council to ensure compliance with the Sure Start funding requirements.