19th October 2018
Established 1872. Online since 1996.

Jobs at risk as engineering firm faces losing its home

Shetland Leasing And Property (Slap) was to start legal proceedings to remove long-established marine engineering firm HNP from its Lerwick premises this week, after refusing a bid by the HNP to buy the site.

HNP Engineering managing director Ian Walterson said that the fate of the company and its 16 full-time employees is hanging on the outcome.

If his advice is not to defend the action he will have to look very carefully at winding up the business which has operated from its present base since 1974, he announced at a press conference at the Commercial Road base today.

Slap, which is a fully-owned Shetland Charitable Trust subsidiary, is understood to be in the process of selling the site to Chester-based Cityheart, the firm contracted by the University of the Highlands and Islands to build student accommodation for the Shetland College.

Shetland MSP Tavish Scott also called on Slap to review its sale and questioned the role of the UHI in the deal.But the property firm denied any bias in its dealings and said that it had tried over a lengthy period to assist the engineering firm to locate to alternative accommodation.

Mr Walterson received a letter from Slap’s representative’s Harper MacLeod dated 11th December to say that legal proceedings would be started to remove HNP this week.

He said that it would be terrible to receive such a blow at any time, but the uncertainty facing his workforce would now overshadow their Christmas.

He added: “I think it’s rubbing salt into the wounds. It is pretty poor and I think it was done deliberately. This has been a huge shock and it has certainly not done me any good.”

Ian Walterson

Ian Walterson

Mr Walterson says that not only is the UHI development unsuited for Commercial Road, which mostly houses retail and trade properties, but Slap’s handling of the situation flies in the face of its public commitment to trust, openness and transparency and of the charitable trust’s commitment to “benefit the inhabitants of Shetland”.

Mr Walterson, who was a successful whitefish skipper before taking on the business, said at the press conference this morning that he understood that Cityheart had only put in a vague, indicative bid before the 25th September closing date and that Slap had continued negotiating with them after that date.

He said that two other local firms along with HNP had been in the running – one had dropped out and the other put in a lower bid. Slap had also asked him to raise HNP’s bid, which he did so, as there was “not a great deal” separating the original offers. He said it was six weeks after the closing date that he was told HNP’s bid had failed.

 

I think it’s rubbing salt into the wounds. It is pretty poor and I think it was done deliberately. This has been a huge shock and it has certainly not done me any good. IAN WALTERSON

He added: “I would think that an 80-bed accommodation block with recreational and catering facilities might struggle to get planning for the site, and there is no parking space.”

Mr Walterson said it would be more appropriate for Shetland College to look at the two student accommodation blocks, Bruce Hostel and Janet Courtney Hostel, that will be vacant once the Anderson High School moves to its new site at Clickimin.

Shetland MSP Tavish Scott said that he was very concerned over the future of “this essential marine engineering business”.

Mr Scott added: “16 local people face uncertainty. HNP work for the fishing, salmon, mussels and oil industries. They look after SIC ferries.

“I want to know what role the UHI PFI (private finance initiative) 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 AHS moves to Clickimin.”

Mr Walterson, who started as a partner in the business in 1996 and now wholly owns it, questioned how many of the charitable trustees knew of their subsidiary’s plans to oust an engineering firm with an important role in servicing local industry including the SIC’s ferries.

Mr Walterson added: “The charitable trust really needs to put the brakes on this and take stock. Slap seems to be a company that are answerable to no-one – and they seem to be out of control.”

Slap chairwoman Susan Groat, speaking through PR firm Platform Shetland, said: “The sale of the land at Commercial Road was a decision by the board of Slap, a private limited company.

“We would strongly deny allegations by HNP Engineers (Lerwick) Ltd that we have shown bias in the handling of this matter.

“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.”

 

We would strongly deny allegations by HNP Engineers (Lerwick) Ltd that we have shown bias in the handling of this matter. SUSAN GROAT

HNP, which was founded in 1969, took a 30-year lease on the site of its present building, housing workshop, store and offices, in 1974. This expired in 2004 when the original site owners Hay & Co (later John Fleming and Sons) sold the site to Slap in a deal Mr Walterson said was kept secret until Slap took over.

After that, HNP’s lease had only been renewed on a yearly basis until, he says, Slap started ramping up the pressure on the firm to vacate around a couple of years ago. It was his understanding that HNP did not fit the profile of what Slap wanted for the area. LESS, which rented the neighbouring building fronting Commercial Road from Slap, moved to the Lower Black Hill Industrial Estate earlier this year.

About Peter Johnson

Reporter for The Shetland Times. I have also worked as an employed and freelance reporter and editor for a variety of print and broadcast media outlets and as as a freelance photographer and film maker/cameraman. In addition to journalism, I have experience in construction, oil analysis, aquaculture, fisheries, the health service and oral history.

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15 comments

  1. John Irvine

    If they need to build student accommodation then why not next to the college, or is that too much like common sense.

    Just when you thought the Charitable Trust could go no lower then this happens, someone has got to get a grip with whats going on at SLAP.

    There is too much of this sort of thing going on nowadays, how long will it be before there is an independent enquiry into how the shambles that is called the SCT? The sooner the better as far as I am concerned.

    Reply
    • Gareth Fair

      You would think so, but if they do it this way when the PFI contract is up wouldn’t Cityheart end up with a prime site to convert to apartments and sell for lots of money?

      Reply
  2. Johan Adamson

    I agree the college should be making plans to go to the old school site and use one of the hostels for accommodation, not be sited here. This is no right if they negotiated with the Cityheart and not HNP after the bid deadline. LESS moved to Gremista not Garthspool.

    Clearing all the tenants for development is lik something from a film, not something you expect here. There should also be a lot more spare accommodation now that gas plant construction is complete.

    Reply
  3. Richard Paton

    I live across from HNP Engineers, and i have to say finally without doubt SCT has lost the plot. The organisation should be fully behind supporting local businesses, not pull the rug from beneath their feet. The fact Irvine’s flats/retail development went ahead despite the limited parking around the area was one thing, but to think possibly more accommodation could be in the pipeline would be a major concern. Perhaps an objection from me might help out HNP, i would love to help them out in any way i can.

    Reply
    • John Tulloch

      Hear, hear, Richard. And whatever rent they’ve had from it has been all profit because they haven’t spent a penny on maintenance of their property – hardly the action of a reputable landlord.

      Reply
  4. Johan Adamson

    We seem to have unleashed these trusts onto an unsuspecting public. They dont have to comply with some of the public sector controls that exist, because they are not the local authority or the NHS, e.g. they dont have to do FOIs, they can meet in secret etc. What can anyone do to complain if they dont like what they are doing? Im sure its not in OSCR’s remit to look at the running of them, and I am not sure that they have any documented procedures to deal with complaints. Raising queries in the press is not adequate as it does not get answered and having queries answered by a PR firm is not enough.

    Reply
  5. Colin McKearney

    Yet another fiasco from the council / SCT / SLAP , (all the same thing really no matter how they try to paint it ) , The removal of a highly respected business , threat to local jobs etc when there is alternative accommodation available once they get their “bells n whistles” school up. The continued ignorance and arrogance of the above organisations is mind boggling , and we actually employ these clowns ??!!

    Reply
  6. Chris Johnston

    Shetland seem to have quite a problem with the various local trusts and their appendages, such as SCT and SLAP. They seem to have a life quite separated from elected local government and responsibility to the citizens. They want to be treated as part of government when it suits their purpose or as a private company when it suits their purpose (quote above, “…Slap, a private limited company.)

    I suspect the falling price of Brent crude oil (US$36.73 per barrel as I type and no bottom in sight) will force a reckoning in Shetland’s budgets in 2016. I hope Shetlanders will take this opportunity to simplify local government structure, making it more transparent and responsive to the citizens.

    Reply
  7. David Spence

    I have a suspicion the SCT, are doing their damnedest to ‘ keep their piece of the pie ‘ known by the fiasco called ‘ The Viking Energy Project ‘. Even although this business does not exist, in terms of functionality (electricity via wind) it has already swallowed up £11 million pounds of ‘ Shetlands Money ‘ and we are still feeding this imaginary monster with ‘ real money ‘ and getting nowhere fast.

    One must seriously ask the SCT ‘ How many millions of ‘ Shetlands Money ‘ must be fed to this ‘ money devouring monster ‘ before they realize this creature which is not worth keeping ? ‘.

    As said previously, there should be a ‘ public inquiry ‘ into the circumstances as to who advised the SCT to invest in a business which does not exist, as such, and how it is the people of Shetland are being led down the garden path by the few who are laughing all the way to the bank on a project which will never get off the ground because the costs are so astronomically large, the SCT investment would not even be a drop in the ocean????????

    Reply
  8. John Irvine

    There is no doubt now that serious questions need to be asked about what interests the trustee`s of the SCT have.

    It seems now totally out of control and decisions being made are not in the interests of Shetland.

    How much longer does this utter shambles carry on before someone steps in and calls a halt? Maybe there`s nobody in the council who has the guts!

    Reply
  9. Amy Inkster

    Anybody who is interested in signing the petition to try and help HNP, please follow this link:

    http://www.ipetitions.com/petition/stop-the-eviction-of-hnp-engineers-lerwick-ltd

    Reply
  10. Donnie Morrison

    I think that it would be in the public interest for the Shetland Times to not only publish the names of the directors of SLAP but to also ask them individually for their opinions regarding this latest debacle – after all they are supposed to represent the Shetland public.

    Reply
    • Chris Johnston

      To paraphrase Professor Marvel in “The Wizard of Oz”, pay no attention to those people behind the curtain.
      What’s to worry about collusion between the right people of right minds and aligned purses?

      Reply
  11. John Tulloch

    Sounds like a severe case of Croneys Disease, Dr Fraser?

    Reply
    • Allen Fraser

      Quite so, Nurse Tulloch, quite so. An extra strong purgative to clean out the whole organisation is required urgently.

      Reply

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