Content

RESOLVED: That
Cabinet;
a)   
Noted the status and the implications of the
financial challenges on the three large housing
projects.
b)   
Approved the new delivery strategy for Avenue
Campus, that will require up to a further 2 land disposals and up
to 2 infrastructure contracts, with the approvals for the former
and one of the latter to be brought back to Cabinet for subsequent
approval.
c)   
Noted that the Section 151 Officer has accepted
circa £1m of Brownfield Land Release Fund grant for Avenue
Campus under his delegated authority.
d)   
Authorised the Director of Communities and
Opportunities to procure and award a contract(s) to supply
utilities to Bassett-Lowke Hall, necessary for the already approved
land disposal, and undertake the infrastructure works required on
the Avenue Campus site in line with the Brownfield Land Release
Fund grant funding agreement.
e)   
Noted the use of up to £4.8m to provide
utilities to Bassett-Lowke Hall, undertake the above infrastructure
works and prepare and submit a revised planning application for
Avenue Campus. The costs for this will in part be met from the
Brownfield Land Release Fund grant, with remaining costs funded
within the existing HRA budget. Subject to the land sale being
completed, the majority of this cost will be offset by the proceeds
from the sale of Bassett-Lowke Hall.
f)    
Noted the use of £1m from the existing Roof
Gardens budget to carry out design work to enable the new delivery
strategy for the Roof Gardens project including submission of a new
planning application for a scheme of at least 58 Council homes,
which will be delivered as affordable homes.
g)   
Noted that Belgrave House is now being taken forward
as part of the wider plans for the Greyfriars English Cities Fund
development project and will no longer deliver the 122 key worker
homes previously proposed by NPH.
h)   
Noted the changes to the above three projects
including the delivery of substantially fewer affordable homes will
reduce the capacity of the HRA to deliver further Council homes,
approvals for which will follow in a further Cabinet
report.
i)    
Noted the use of funds from the HRA to undertake the
above recommendations where applicable.
 
REASONS RESOLVED:
 
1.   
The recommended course of action is the most
cost-effective, giving the greatest chance of recovering the
incurred costs to date while seeking to deliver affordable housing
and minimising the site holding costs currently being
incurred.
2.   
The Council will receive the maximum benefit from
the option proposed through recovering as much of the investment to
date and delivering as many affordable homes as
possible.
3.   
The recommended approach for Avenue Campus has the
potential to better deliver the Council’s Housing Strategy by
creating a more balanced, thriving and sustainable community whilst
still seeking to maximise the amount of affordable housing that is
viable on the site. This will result in the delivery of between 113
and 170 homes, all or the majority of which will be for market
tenures, with affordable homes only delivered once it is clear the
Council can recoup the £13.7m expenditure to date in full or
where the financial performance of delivering affordable housing
matches that for market homes. This compares with the 170
affordable homes proposed in the original.
4.   
The revised scheme for Roof Gardens will contribute
to the delivery of the Council’s Housing Strategy and also
its new Affordable Homes Delivery Plan launched in November 2024.
Along with Castle Street this will result in the delivery of 82
affordable homes, replacing the same number that were demolished on
the site, a reduction from the 126 affordable homes originally
proposed by NPH. Approvals for the subsequent building contract and
financial approvals will be brought back to Cabinet in due
course.
5.   
In due course the redevelopment of the Belgrave
House site will deliver various regeneration and economic benefits
(e.g. jobs).
6.   
The eventual delivery of all of these schemes will
cease the holding costs for the 3 sites that the Council is
currently incurring and generate construction jobs and associated
spend locally.
 
ALTERNATIVE OPTIONS:
As the original 100% affordable
housing projects are no longer financially viable, the Council
needs to bring these sites forward using different strategies,
which will involve using market sale and other uses to seek to
minimise any financial losses.
 
Different approaches for the
three sites are required than was set out by NPH. Further Cabinet
reports will set out further detail in due course. Given the
changes required, the Council will only be able to deliver 82
affordable homes including the 24 recently completed affordable
homes at Castle Street (possibly more if the viability of Avenue
Campus improves). This compares with the 418 affordable homes
proposed by NPH.
 
Given that the three large
housing projects have not been delivered and the need to return the
Homes England grant allocation, there is also a need to rebuild the
relationship with Homes England so that the Council can access AHP
grant in future rounds. Having secured circa £1 million of
Brownfield Land Release Fund grant on the Avenue Campus site the
Council would need to start on site with infrastructure works by
31st July 25. This grant funding would clearly improve the
financial viability of the scheme and could be used in conjunction
with other grants which will be explored.