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HNP asks SLAP for more time to vacate site

HNP's building on the SLAP-owned Commercial Road site. Photo: Shetnews

HNP ENGINEERING is urging Shetland Charitable Trust’s property arm SLAP to give it more time to move to new premises after the landlord served notice that it may take legal action to evict the local engineering firm.

Following a long-running dispute, HNP is now in the advanced stages of purchasing a workshop building at the Lower Blackhill industrial estate in Lerwick – allowing the company to vacate the SLAP-owned Commercial Road site it has occupied for around half a century.

HNP – which employs 16 people – says it received a legal letter from SLAP last week stating that it would apply for a court order to recover possession of the property if HNP has not vacated the site by Saturday (28 May). 

The property company says that HNP has been given “ample time” to make alternative arrangements.

SLAP has agreed a deal with Cityheart Ltd to use the Commercial Road site for an 80-person University of the Highlands and Islands (UHI) student accommodation block. A planning application was recently submitted to Shetland Islands Council.

But HNP Engineers owner Ian Walterson said the Lower Blackhill premises would need a “considerable amount of modification and building work” before HNP could make the move.

He is angry that SLAP is “not prepared to give the necessary time required” particularly because, with the planning application only having been submitted recently, he believes that even if everything goes smoothly it will take “a number of months before consent is granted”.

Walterson maintains that, with compensation due to HNP under the terms of the lease yet to be properly determined, SLAP is not entitled to try to evict his company.

HNP, which owns the building but not the land it sits on, had hoped to remain at the Commercial Road base by agreeing either a new long-term ground lease or by purchasing the site.

Walterson remains disappointed that SLAP overlooked HNP’s “very good offer” of £330,000 for the site last autumn, instead accepting an offer from Chester-based Cityheart. The company owner felt its offer “was not given fair consideration and had no chance of success”.

He said that if there was “any show of goodwill or reasonable dialogue coming from SLAP, the situation could be brought to a satisfactory conclusion for both parties”.

HNP owner Ian Walterson.

“If SLAP do begin eviction proceedings as threatened there will still be a battle to stop that happening,” Walterson added. “All we ask for now is to be given enough time to survive and continue to provide employment, training and a service to Shetland into the future.”

SLAP chairwoman Susan Groat said SLAP had made an informal offer via a third party to avoid court proceedings – which would have resulted in HNP being granted a short licence to remain on the Commercial Road site while it relocated.

“This would have been SLAP’s preferred option, representing an amicable, professional way forward carried out directly between the businesses rather than through the media,” she said.

“However, we are dismayed that HNP is disputing that its lease has ended and the amount it is entitled to after it vacates the building.”

She said SLAP made an offer for the building, based on an independent valuation, more than 17 months ago.

“HNP has now threatened in a legal letter that it will only vacate the premises once SLAP has agreed to an increased payment or the court has fixed one,” Groat continued.

“The company’s lawyer has told us that it will remain on the premises, leaving us with no option but to apply to the court.

“If we do not do this, we risk placing the deal with Cityheart to develop student and key worker accommodation for UHI in jeopardy.

“The legal ‘Notice to Quit’ was served more than three months ago, giving HNP ample time to make alternative arrangements.”

Groat added that the premises HNP is moving to were first introduced to the company in a letter from SLAP’s property agent in March 2015.

“As we have already stated, SLAP has spent a considerable amount of time putting forward different options for relocation. We are delighted that HNP has secured new premises and wish the company well.”

She said SLAP was “extremely concerned” about the lack of evidence of health and safety compliance by HNP “given its lack of response to several letters from SLAP”.

Shetland MSP Tavish Scott said that by finding another building to move into, HNP had “complied with SLAP’s need to move away from a site they have occupied since the 1960s. That is also having offered £335,000 for the site – an offer that was rejected by SLAP.”

He added: “It is only reasonable that SLAP now give HNP the time they require to move building. That is not straightforward as there is heavy industrial machinery to shift.

“But there is no planning permission yet for any new development on the site. The earliest I understand that could be determined would be August.

“As a result a sensible negotiation would ensure that HNP had the necessary time to move. I expect that to happen.”