Agenda item

[Report of the Interim Director for Housing, Regeneration and Planning. To be introduced by the Leader of the Council.]

Cabinet will  be asked to agree the acquisition of 131 homes and to agree that the ground floor non-residential space  be constructed at the Welbourne Site and to  further  note  a future key decision  on  final purchase price and the final heads of terms of the acquisition and the final contract.

The Leader introduced the report which was to seeking a Cabinet resolution to acquire 131 homes and a commercial unit, to be constructed on the Welbourne Site as part of its redevelopment being carried out by Argent Related under the Development Agreement dated 21^st March 2017, between the Council and TH Ferry Island Limited. This transaction would provide Council homes on Council land, within the context of the existing Strategic Development Partnership (SDP) Development Agreement.

The proposed delivery of 131 council homes on the Welbourne Site represented 13% of the overall Council homes target and, subject to planning, would be delivered in the lifetime of this administration.

In response to questions from Cllr Gordon, the following information was noted:

·         The Council homes at the Welbourne site would be managed by Homes for Haringey and the specifications applied to the homes would not be lower quality. The expectation for the fit out of the new homes had been set out and there were specific suppliers in place to deliver the specifications. There would be different suppliers used for different aspects of the new homes. For example, a different supplier would be used for bathroom fit out and a dissimilar contract supplier used to fit out door entry system, meaning that there would be different costs according to the fittings purchased.

·         In relation to the fit out of the bathrooms and flooring, it was noted that there would be consideration of the lifecycle costs and the durability when purchasing materials. Therefore, there was a value difference but not a quality difference.

·         In relation to the standards and cost of the fittings in the council homes at Welbourne being lower than that of other Council homes, it was clarified that this was not the case and this was about the Council and homes for Haringey specifying what was in place for housing stock. The Council would factor in the repair and maintenance, further considering how easy it would be to source replacements when considering the fit out costs.

·         A written answer in response to the question on the Tottenham Hale strategic Development plan would be provided to Cllr Gordon in seven days.

Further to considering exempt information at item 19,

RESOLVED

1. To agree (subject to the council’s budget setting meeting in February 2019) to the in-principle acquisition by the council for housing purposes of 131 homes and a ground floor non-residential space to be constructed at the Welbourne site for a maximum total sum as set out in the exempt part of the report and based on the draft Heads of Terms attached in the exempt part of the report.

2. To agree to note that a further Key Decision will be taken at a later date to agree the final purchase price and the final contract for the acquisition.

3. To agree that (subject to the council’s budget setting meeting in February 2019) the unallocated General Fund capital receipts, as set out in the exempt part of the report, are retained corporately.

Reasons for decision

The acquisition of the residential premises on the Welbourne Site will allow the council to secure the rapid delivery of council owned homes utilising the existing Strategic Development Partnership with Argent Related as the delivery agent.

Critically, it also supports the delivery of the district health centre, which offers a once in a generation opportunity to enhance the way in which local primary health care services are delivered.

This responds to local aspirations to see an increase in the amount of new affordable homes delivered. In so doing it meets a key commitment of the new Administration; to deliver council homes at council rents. It delivers an improved mix of affordable housing in Tottenham Hale, which better meets the needs of local people.

The emerging Borough Plan prioritises the delivery of safe, stable and affordable homes for everyone, whatever their circumstances. This deal represents 13% of the council’s objective to deliver 1,000 council homes at council rents over the lifetime of the current administration.

Alternative options considered

A series of options were considered which would materially improve the affordability of homes to be delivered at the Welbourne Site. These were:

Option A:The council acquires the Welbourne site in its entirety. This is the preferred option as it allows the council to control the tenure for all homes, set the rent levels, and negotiate an appropriate specification for affordable homes and service charges. This option achieves the most affordable outcome for the homes to be delivered. This option also results in a surplus land receipts of £12.25m being returned to the General Fund.

Option B:The council could provide grant funding to a Housing Association in order to deliver more genuinely affordable homes on-site. This option would involve the council providing grant funding to secure the delivery of lower cost affordable housing. This option was discounted on the basis that the council is moving towards a position of prioritising the delivery of council owned homes on its own land, in order to maximise the delivery of safe, stable and affordable homes.

Option C: The council could decide not to proceed with either acquiring the Welbourne site in whole or in part, or funding a third party at this or other locations in Tottenham Hale to increase the amount of affordable housing delivered. This would result in the Argent Related scheme proceeding with 25% Shared Ownership homes on the basis of its SDP affordable housing contribution.