«1.0 Report Summary 1.1 In March 2011 Cabinet gave approval for the disposal of eleven Cheshire East owned sites for the provision of affordable ...»
CHESHIRE EAST COUNCIL
REPORT TO: Cabinet
17th September 2012
Date of Meeting:
Strategic Director Places & Organisational Capacity
Affordable Housing Programme – Phase Two
Councillor J. Macrae
1.0 Report Summary
1.1 In March 2011 Cabinet gave approval for the disposal of eleven Cheshire East owned sites for the provision of affordable housing. Of the eleven initial sites, four were taken through a pilot OJEU procurement exercise to establish whether this was the best route for disposal and whether financial objectives and social return could be secured from the programme.
1.2 Following on from the success of the initial first phase pilot the Affordable Housing Working Group are now in the process of progressing Phase 2, which was to include the remaining seven sites.
Two sites are no longer available for the provision of affordable housing and this report seeks permission to replace these sites.
2.0 Decision Requested 2.1 Approval is sought to dispose of the following sites:
Birtles Road, Macclesfield - for the provision of housing with a type of • scheme which fits with the character of the locality;
Redsands, Nantwich - for the provision of accommodation for • residents with support needs to be developed on the current footprint of the existing buildings located on the site to ensure that it is compliant with Policy NE.4.
The final schemes will be reviewed with local Ward Councillors and consulted upon locally prior to sale.
2.2 Approval is sought to seek Secretary of State consent for the disposal of the former Lodgefields School site in Crewe.
2.3 Approval is sought to allow for the provision of up to 50% market housing in conjunction with 50% affordable housing on the Lodgefields School site in Crewe to ensure that the site is financially viable and to encourage further Version 5 interest following the poor response to the Westview site in Crewe within phase 1.
3.0 Reasons for Recommendations 3.1 One of the key priorities identified within Cheshire East’s Housing Strategy is the delivery of both market and affordable housing. There is a significant need for affordable housing across Cheshire East, demonstrated in the 2010 Strategic Housing Market Assessment, which identified an annual need for 1243 homes. The low level of housing developments and the reduction of public subsidy are impacting on our ability to bring forward affordable housing.
This situation places additional onus on the Council to find new and innovative ways of meeting its affordable housing needs. The use of Council owned assets is a means of achieving this.
6.1 Housing is fundamental to the well being and prosperity of the Borough. There are direct connections between the quality of the housing stock and health, educational attainment, carbon reduction and care for older people. Providing sufficient housing is essential to maintain economic growth and vitality – and access to housing is a key issue in rural areas.
7.0 Financial Implications (Authorised by the Director of Finance and Business Services) 7.1 Capital receipts generated through the sale of Council owned assets are an increasingly important feature of the Capital Programme, and the Business Plan sets the challenging target of £10m in capital receipts for the current 2012/13 financial year and £5m in both 2013/14 and 2014/15. There will be a need to take into consideration the Council’s wider financial requirements when determining the rationale around the disposal of assets.
7.2 Phase 1 of the affordable housing programme however demonstrated that not only were we able to secure the provision of approximately 50 units (subject to Planning Permission) of affordable housing but we were able to retain Version 5 ownership of the land (125 year lease) and receive an annual revenue stream for the duration of the lease which increases in line with RPI annually.
7.3 The development of new affordable homes will bring in the New Homes Bonus, which is based on the National average Council Tax and is payable for six years. In addition Affordable Homes attract a further £350 per affordable home and is also paid for six years for example
8.0 Legal Implications (Authorised by the Borough Solicitor) 8.1 Due to the value of the assets to the housing providers the Council will need to procure its partners in compliance with EU procurement rules.
8.2 Preliminary title reviews in respect of the properties, in respect of which title details are awaited, have revealed the presence of some covenants, rights over or in respect of the properties and other matters which could adversely affect development.
9.1 The OJEU procurement process is a resource intensive process which requires the input from a number of officers to ensure that it is carried out in accordance with the regulations and we do not face future challenge. To ensure an effective use of our resources we need to optimise the number of sites included in the second phase which will ensure that we receive sufficient interest from the market.
9.2 The former Lodgefields School site which has approval for disposal for affordable housing will now require Secretary of State consent for disposal. The process could preclude the site from inclusion in the second phase of the programme and there is a risk that the Secretary
10.0 Background and Options 10.1 In March 2011 a report was submitted to Cabinet which included the use of a number of council owned assets for the provision of affordable housing. These
10.2 The contract for Phase 1 was awarded in March 2012 and the successful contractors are now progressing the developments through the planning process. Phase 1 demonstrated that there is interest from the market to develop affordable housing. The approach taken to lease the land on a 125 year lease agreement also enabled us to retain the land asset and secure an annual ground rent.
Whilst we received significant interest for the sites in Macclesfield, there was less interest for the Westview site in Crewe. We asked those who had not submitted bids the reason why they had declined and this was attributed to the land value and the ability to provide 100% affordable housing on any site in the Crewe area as it was not considered financially viable. This has been taken into account for Phase 2 and the Working Group would therefore like the option to consider variable bids which include up to 50% market housing in order to subsidise the development of the affordable units in the Crewe area.
10.3 The Affordable Housing Project Working Group which consists of representatives from Assets, Housing, Procurement, Legal and Planning are now progressing Phase 2 of the project through the same OJEU procurement route. The intention was to bring the remaining seven sites to the market.
10.4 During the first stage of the process two sites were identified for alternative uses and were removed from the programme.
10.5 We are now seeking to replace the two sites to ensure that there are sufficient sites to generate interest from the market. There are a number of sites which have been considered and the following have been established as potential sites following discussion with both Assets and Planning. The final mix of tenure will be reviewed prior to award of contract and full consultation will take place with Local Ward Members.
There is currently a derelict building on the site which has locally listed status. In accordance with Council guidance on this subject retention of a locally listed building should be investigated and retained where practicable. Normally, loss of the building will only be permitted if Cheshire East Council is satisfied it is beyond reasonable repair. If this is the only option officers should ensure elements of the Locally Listed Building are incorporated into any new design proposal.
Where retention proves impracticable, the council will require that a photographic record of the building is made prior to demolition and submitted to the Council for record purposes.
As highlighted above, consultation with local Ward Councillors and residents will take place prior to any sale of the Birtles Road site to ensure the appropriate mix of uses is brought forward to reflect local need, and to ensure the site is in a sustainable location for development. If local concerns are raised, the matter be referred back to Cabinet for a further decision on whether or not to proceed.
Redsands Wistaston- Appendix 2
Cabinet made a previous decision on 19th January 2010 in relation to disposal of this land. At that time Cabinet resolved that approval be given to procure a development partner for the Redsands site to provide supported living facilities for adults with a learning disability.
Adult Services no longer wish to pursue the development of this type of
11.0 Financial considerations: When considering the disposal of the sites for the provision of potential affordable homes consideration should be
taken on the following points:
Name: Karen Carsberg Designation: Strategic Housing Manager Tel No: 01270 686654 Email: Karen.firstname.lastname@example.org Version 5 Appendix 1 Birtles Rd Macclesfield This site is located to the north west of Macclesfield town centre on Birtles Rd and is around 1.7 acres in size. It includes a derelict property at 70 Birtles Road which has locally listed status.
A planning application for reserved matters for 41 affordable houses providing a combination of semi-detached and small terraced blocks was submitted by Jones Homes in April 2008 (planning reference 08/0775). The application was accompanied by a further one for the use of land for footpaths, driveways, road, gardens and landscaping (planning reference 08/0773) on the land fronting Birtles Road known locally as the “lay-by”.
Planning application 08/0775 was refused by the former Macclesfield MBC
Planning Committee on 16 June 2008 for the following reason:
Planning application 08/0773 for the associated development of the lay-by area was approved with conditions by the former Macclesfield MBC.
There were a number of other comments made by members of the Planning Committee which, although not reasons for refusal, could be addressed in any revised scheme. In particular, as the application was for reserved matters, it had to comply with the terms of the outline planning permission granted in
2005. As that has now elapsed, the issues raised such as open space, access to the allotments to the rear, pedestrian access and other matters, would need to be addressed as part of any new full planning application.
In August 2008 Members of the former Macclesfield MBC Cabinet were asked to (and subsequently resolved) (1) Note the current position regarding the provision of affordable housing on land at Birtles Road, Macclesfield
(3) Agree that the development of the site on appropriate terms for affordable housing be delegated to officers in consultation with the Portfolio Holders for Planning & Development and Asset Version 5 Housing Need - In Macclesfield and Bollington the SHMA identified a need for 318 units of affordable housing, consisting in the main of 175 two bedroom properties and 109 three bed properties.
There are currently 50 applicants registered on Cheshire Homechoice stating a preference for this area, consisting of 7 people asking for a 1 bed property, 9 asking for 2 bed houses and 19 asking for 3 bed houses. In addition there has only been one 4 bed affordable unit vacant in the last year which received 32 bids indicating four bedroom properties are of high demand in this area.
Version 5 Version 5 Appendix 2 Redsands Wistaston This is a 0.76ha site located to the south west of Crewe between Crewe and Nantwich off the A534, Crewe Road.
The site is located in a sustainable location with excellent access to services and facilities in Nantwich Pedestrian and vehicle access is gained via a single entry from Crewe Road.
Parking exists on site immediately to the south of the developed area.
Within the site there are large areas of open space including a pond and football pitch to the west of the developed area.
Previous development on the site has been restricted to an area of approximately 0.76ha consisting of three buildings: one main two storey block, one single storey building to the rear and one single storey building to the east.
Cabinet has already made a previous decision on 19th January 2010 in relation to disposal of this land. At that time Cabinet resolved: That approval be given to the transfer of the site from the Children’s Services to Adult Services at the valuation of £155,250.
That approval be given to procure a development partner for the Redsands site to provide supported living facilities for adults with a learning disability.
That Counsels opinion be sought to ensure that the disposal of land to the chosen Registered Social Care Landlord does not fall within the definition of a Public Works Contract and so be caught by Public Contracts Regulations 2006 as referred to in paragraph 9.2 of the report.
That approval be given to go out to consultation to look at future need for respite for people with very complex conditions, in line with personal budgets and use of alternative provision.
Housing Need - It is proposed that this site be developed as a mixed
community which could contain one or more of the following:
Affordable housing - The SHMA identified a need for 256 new affordable units per year in Crewe, made up of need for 123 x 1 beds, 20 x 2 beds, 47 x 3 beds, 40 x 4/5 beds and 26 x 1/2 bed older person units.