annington annual rep 2019-web - Page 29



Strategic report | Principal stakeholder
Principal stakeholder
PRINCIPAL STAKEHOLDER
MOD RELATIONSHIP
Annington’s main contact with the
MoD is via the Defence Infrastructure
Organisation (“DIO”). During the year,
the DIO has seen many changes as the
outsourcing contract with Capita MoD is
wound down. However, over the same
period, Annington’s engagement with
the MoD has increased. Negotiations
occurred throughout the year on how
the Site Review would be completed,
the result being the signing of the
Arbitration Agreement and associated
commercial terms. Under the Arbitration
Agreement, Annington and the MoD
have agreed to an expedited Site
Review process, as set out previously.
Additionally, the MoD has agreed to
release a total of 3,500 units over a
seven year period, with a target of 500
per year, on a two year rolling
average basis.
Annington has committed to providing
dilapidations relief on 500 units per year
up to £7,000 per unit and has permitted
the MoD to sub-let units on revised
terms. Annington believes that the
outcomes of the Arbitration Agreement,
including the negotiation of the Site
Review will be mutually beneficial to
both parties.
Subsequent to year-end, both Annington
and the MoD have progressed on the
revised Site Review work streams. Given
the early stages of this process and the
ongoing work being performed, it is
too soon to estimate the prospective
outcome.
The Group reiterated its commitment to
working with the MoD going forward in
order to maintain a positive and mutually
beneficial relationship.
FORMER MOD HOMES AT
RAF HENLOW HAVE BEEN
EXTENSIVELY REFURBISHED TO
PROVIDE MUCH NEEDED TWO
BEDROOM STARTER HOMES.
28 | Annington Limited Annual Report & Accounts 2019
Annington Limited Annual Report & Accounts 2019 | 29

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