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HNP Engineers facing eviction by SLAP

HNP Engineering has occupied the premises at Commercial Road since 1974 - Photo: Chris Cope/ShetNews
HNP Engineers had occupied the premises at Commercial Road since the 1970s. Photo: Shetland News

AN ESTABLISHED local engineering firm claims it could be forced out of its Lerwick premises and “destroyed” by landlords Shetland Leasing and Property Developments Limited (SLAP) to make way for student accommodation.

HNP Engineers, which has occupied premises at the town’s Commercial Road since 1974, says the business is being evicted from the site by the property arm of the Shetland Charitable Trust – leaving 16 full-time jobs in jeopardy.

Managing director Ian Walterson believed the premises could be sold to Chester based developer Cityheart Ltd to build an 80-bed halls of residence for the University of the Highlands and Islands (UHI).

He admitted the company would most likely be wound up if no legal action is taken because it would be “tremendously difficult” to relocate as moving their heavy machinery would be a “major logistical procedure”.

A letter solicitor firm HarperMacLeod, seen by Shetland News, confirms that SLAP seeks to commence the removal of HNP from the premises before the end of the month.

SLAP chair Susan Groat responded by “strongly denying” the company has shown bias in the sale of the land, which covers around 0.45 acres.

She also stated that HNP decided against taking “assistance” from SLAP with regards to finding alternative workspace.

Managing director Ian Walterson claimed the company was being destroyed by SLAP.

HNP – which works in industries such as fishing and oil, as well as maintaining Shetland’s inter-island ferries – uses a workshop, store and office on the land, but SLAP acquired the site in 2004 and moved the company’s long-term lease to a year-on-year one.

However, the site – which includes the HNP building and the former Lerwick Engineering Supplies premises – was advertised for sale earlier this year, with a closing date of 25 September.

Walterson said that his business was invited to bid and it ultimately submitted an offer worth “double the valuation”, with two other local companies in contention.

On 3 November, he said, HNP was contacted by SLAP’s agent to confirm that it was the only party left in the bidding process out of the three.

However, Walterson said he was told another offer had been made by a new bidder, prompting SLAP to enter negotiations some six weeks after the offer deadline had passed.

HNP was informed after a SLAP board meeting on 25 November that their bid had been unsuccessful.

SLAP, Walterson claimed, suggested HNP was not “suitable” for that part of Lerwick anymore because it is “now mainly residential”, despite the engineering firm being long-term tenants.

The property advert on SLAP's website.

The premises sit opposite the likes of Anderson Butchers and the Happy Haddock, with the new block of flats currently being erected beside the site set to feature retail premises on its ground floor.

Walterson claimed there was “no transparency at all” to Shetland Charitable Trust and questioned whether the trustees are fully aware of SLAP’s moves.

SLAP chairwoman Groat said in response: “The sale of the land at Commercial Road was a decision by the board of SLAP, a private limited company.

“SLAP has invested a significant amount of effort over a prolonged period to assist HNP to find alternative accommodation, but the company has chosen not to pursue any of these options.”

Shetland MSP Tavish Scott, meanwhile, called for SLAP to review the sale.

The proposed Lerwick halls form part of a £44 million agreement Cityheart Ltd has with the UHI to build student accommodation across the north of Scotland.

Local construction firms recently expressed frustration after Cityheart Ltd was given the contract to build a halls of residence for Shetland College and NAFC Marine Centre students without other companies being given the chance to tender.

He said: “I want to know what role the UHI PFI deal to build an accommodation block has in this?

“Did the UHI, a publicly funded university, pay more for the Commercial Road site than HNP offered? Is it right for SLAP to sell this site from under a tenant who has made a reasonable offer?

“It cannot be good for Shetland to put the future of this company in question. SLAP should review this sale. After all there will be plenty of sites for student accommodation when the Anderson High School moves to Clickimin.”