© Sunday Herald
Originally published: 28.05.2006

Forth Ports has cut short its 10-year agreement with developer Bellhouse Joseph to manage and develop a portfolio of properties that included much of its land along the Edinburgh waterfront at Leith and Granton.

According to sources the company has apparently disbanded its management contact and taken the decision to handle those responsibilities in-house.

It is believed that Forth Ports executives were unhappy with the progress Bellhouse Joseph had made in ensuring that the environment surrounding the residential developments were sufficiently attractive.

Over the past 18 months, Forth Ports has appointed a new managing director of property, Nathan Thompson, two new project managers and built up its designated team to around 15.

The situation is a turnaround from 2002 when Bellhouse Joseph was tasked with putting in place the infrastructure, greenspace, common environment and local amenities around the acres of land that Forth Ports had been selling on to housebuilders and other property companies for development.

The joint venture included Forth Ports property holdings at Western Harbour, Granton Harbour, Britannia Quay, Waterfront Plaza and land at Dundee and Grangemouth, which were said to have a value of £150 million at the time.

When asked about the change, Charles Hammond, chief executive of Forth Ports, said: "The property world is full of people who are full of gossip.

"We continue to have a relationship with them. [The joint venture] hasn't been dissolved. We still have that."

As part of the original agreement, Bellhouse Joseph also committed up to £10m for a 10 per cent stake in Forth Port Holdings, which included the portfolio of properties. Bellhouse Joseph's investment was backed by the Bank of Scotland, Noble Grossart and Premium Estate Holdings, part of a Hong Kong-based investment group which already holds commercial properties in Edinburgh.

According to an industry source, Bellhouse is in negotiations to sell its stake in Forth Port Holdings.

When asked if this was true, Hammond replied: "I wouldn't comment on that. That would be market information that we would be obliged to disclose to the stock market. The fact we haven't made an announcement should tell you something."

Development along the waterfront of the Forth, stretching between Leith and Granton, has attracted criticism from a number of quarters.

Peter Wilson, the director of Napier University's School of the Built Environment, recently described some of the residential buildings along the waterfront as looking "as if it's been made out of chewing gum and string. There are some good buildings around, but there are also many that are diabolically poor".

Property agents have said that sales had been held back by a slowdown in the housing market but also by the lack of infrastructure and facilities that would make it a nice place to live.

Many believe that there has to be a more cohesive approach between the three landowners - Forth Ports, National Grid Properties and Waterfront Edinburgh - to ensure that public space, cultural activities and retail facilities exist so that the plots of land sold off for development are successful.

John Brown, a director of DTZ Residential, said: "It now needs a comprehensive approach. The three main landowners need to talk to each other more and come together in terms of marketing and other initiatives."

Hammond said that Forth Ports would be investing £20m plus per annum to build infrastructure and create a sense of place in the area. He said that the plots of land sold several years ago will have less than 1000 houses on them and the ultimate plan was to create 20,000 homes with a wide range of housing.

He added that Forth Ports was building a 20-acre park in Western Harbour and a vibrant retail and leisure hub among other schemes. He said that evidence that the three landowners were working more closely together would come to light in the next month.