Social Housing Speed Read – deals with private developers
17th July, 2017
We look at the Haringey Development Vehicle, a partnership between Haringey Council and a private developer and whether this approach could be used further going forward to deliver more housing.
Development Vehicle
On Monday 10 July Haringey Council’s cabinet voted to establish a 50:50 partnership known as the Haringey Development Vehicle between Haringey Council and Lendlease after three and a half hours of discussions.
The partnership is set to deliver 6,400 new homes for the community, with 40% of all new housing to be affordable. It will also bring thousands of new jobs for residents of Haringey with investment in infrastructure, including a new school, health centre, retail, office and community space and a library.
The council plans to ensure its share of the profits goes back into the community, highlighting that the 50% stake in the partnership is crucial as it means the council will retain control by having to approve every decision.
The partnership in operation
Essentially, Haringey will provide some of its council land to be developed, with Lendlease providing its development expertise and funding as a match for the land.
In all cases, before any land is transferred to the partnership it will be individually assessed. The Council’s Cabinet must also approve a detailed plan for the use of the property and there will be a full consultation with the community followed by a planning application.
Haringey Council states that it plans this to be a long term partnership lasting for at least 15 – 20 years and that the first phase will see a planned 5,000 new homes built.
Challenge
Nonetheless, the partnership, perceived by many as a “sell off”, is not without opposition and campaigners within the community have raised £24,000 to fund a legal challenge.
The challenge is on the basis of inadequate consultation, the issue not being put before a full council and on the lack of an equalities impact assessment for the plans.
An amalgamation for more councils to consider?
Despite the opposition, it is clear the council is trying to adapt to the cuts in funding by utilising the tools that are available.
Haringey Council highlights that it owns a “significant amount of land” that must contribute to growth but it does not have the “finance and skills to bring forward homes and jobs on that land at the scale, pace and quality that is needed”.
The council also emphasised that “this is a major decision for any council and not one that was taken lightly” and that it considered other options.
This included selling land to developers, as is more traditional, but the Council stated that this would not guarantee the change needed at the pace demanded, plus it would be unlikely to deliver the level of affordable housing required.
Regardless of the outcome of any legal challenge, it is positive to see the council exploring options of how to use the land it owns for the benefit of the community and to address the need for housing.
If the venture is a success, it could lead the way for other councils who have not considered such a partnership before and who need to develop affordable homes but do not have the resources to do so. Such could help contribute to fixing our “broken” housing market.
If you have any questions on the above and how it will affect social housing providers, or any other questions as a social housing provider, please do not hesitate to contact John Murray or a member of our expert Social Housing Team.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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