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REPORT OF THE DIRECTOR OFSUSTAINABLE REGENERATION
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TO THE LEAD MEMBER FOR HOUSING
ON
15th September 2009
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TITLE: Pendleton Private Finance Initiative rehousing options
RECOMMENDATIONS:
That Lead Member:
- Notes the progress made on bringing forward affordable housing on the Lilac Ct and Fitzwarren Street sites;
- Gives approval for offers of priority rehousing to be made to residents within the High Street area on a phased basis in line with existing nomination, relocation and lettings policies;
- Approves the acquisition of private properties on the estate sold previously under Right to Buy Legislation and the offer of relocation assistance to qualifying owners under conditions detailed in the Private Sector Housing Assistance Policy 2006 (Amended 2008);
- Approves the payment of statutory homeloss and disturbance compensation to qualifying residents affected by the proposals;
- Gives approval for the use of short term tenancies within the High Street estate;
- Gives approval for Salix Homes to suspend lettings in the clearance area and bring forward the demolition of properties within the clearance area on a phased basis.
- Delegates responsibility to the Pendleton Private Finance Initiative Project Board for monitoring the delivery of the rehousing plan and agreeing future phases of clearance and acquisition.
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EXECUTIVE SUMMARY:
The Private Finance Initiative Outline Business Case identified the demolition of 891 properties to provide redevelopment opportunities that will start to transform Pendleton and help deliver the wider regeneration of the area. Obtaining vacant possession of these sites will be the council’s responsibility and risk under the terms of the project agreement. The ability to bring forward new affordable housing development on the Lilac Court and Fitzwarren Court sites provides an early opportunity for residents living in this area to be offered new homes, for Salix Homes to commence the early clearance of part of the estate and help manage this risk.
The report seeks approval to instruct partners including Salix Homes and Urban Vision to commence the clearance and acquisition of the first sub phase of housing and to delegate responsibility of agreeing future phases of clearance and acquisition within the rehousing plan to the Private Finance Initiative Project Board.
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BACKGROUND DOCUMENTS:
Report to Cabinet ‘Pendleton PFI Outline Business Case Financial Affordability’ June 2008.
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KEY DECISION: NO
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DETAILS:
1.0Purpose of report
1.1The purpose of this report is to update Lead Member on progress in bringing forward early opportunities to provide rehousing choice to residents affected by clearance proposals in Pendleton and on options to progress rehousing on a phased basis as further opportunities arise.
1.2The report seeks further approval to instruct partners including Salix Homes and Urban Vision to commence the clearance and acquisition of the first sub phase of council stock and to delegate responsibility of agreeing future phases of clearance and acquisition within the rehousing plan to the Private Finance Initiative Project Board.
2.0Regeneration update
2.1The proposed scope of the Pendleton Private Finance Initiative scheme and the financial implications for the Council are outlined in the Cabinet report ‘Pendleton PFI Outline Business Case Financial Affordability’ June 2008. The procurement of a preferred Private Finance Initiative contractor is underway and is expected to be concluded in the summer of 2010. The report identified the demolition of 891 properties, including four multi-storey blocks of flats (inclusive of owner occupied and leasehold properties). Obtaining vacant possession will be the council’s responsibility and risk under the terms of the project agreement.
2.2A draft rehousing plan has been produced that details how partners will maximise rehousing choice for residents affected by clearance and manage decline across the neighbourhoods. The rehousing plan also provides guidance to the current bidders developing proposals for redevelopment across the area. The report suggests that around a third of the new 1600 units proposed should be social rented properties, made available in the first instance to residents affected by clearance.
2.3In order to further maximise rehousing choice to residents the Council has worked with an existing housing association partner, Great Places, to bring forward early residential development on the Lilac and Fitzwarren Court sites. The construction of 39 family houses has started on both sites and is expected to be completed in March 2010. 31 homes will be social rented units with the remaining 8 units shared ownership. It has been agreed that all of these properties will be nominated in the first instance to residents living in the clearance areas.
3.0Proposed first phase clearance area.
3.1The rehousing plan identifies part of the High Street estate (Phase 2) as the proposed first phase of clearance. The High Street estate was identified because of it’s proximity to adjacent cleared sites that were envisaged to be brought forward as a first phase of new residential development by a preferred bidder. The affordable housing element of thefirst phase of development could then be made available to facilitate clearance of the High Street estate. The Pendleton Planning Guidance also identified the clearance of the High Street estate as having redevelopment potential to link these early phases of development back to SalfordShoppingCity and other key strategic sites in the area.
3.2It is intended that the Council and Salix Homes work with the preferred bidder to develop the detailed relocation programme that would enable the redevelopment of Pendleton to progress whilst ensuring maximum choice is available to residents living in clearance areas. The development of social rented housing on the Lilac Court and Fitzwarren Street sites provides an early opportunity for residents living in this area to be offered new homes and for Salix Homes to commence the clearance of part of the estate.
3.3Consultation on the wider regeneration proposals has been extensive and Salix Homes have visited over 600 residents in their homes identifying resident rehousing requirements and aspirations. Initial analysis of this Housing Need Survey has suggested that demand for new homes from residents living in Holcombe Close best matches the number and type of new family homes being built by Great Places and that this should be identified as the first sub phase of clearance in the Pendleton area.
4.0Managing the relocation process and the redevelopment area
4.1In order to manage the relocation process and give more certainty to the rehousing choices available to those residents looking to move into the new developments it is proposed to bring forward clearance in the area on a phased basis. It is recommended that the Private Finance Initiative Project Board is responsible for monitoring the delivery of the rehousing plan and agreeing future phases of clearance and acquisition.
4.2The majority of residents living in Holcombe Close and the High Street estate have expressed a desire to move into new homes in the new residential development. It is recommended that Salix Homes work with officers at Great Places to consult with residents in Holcombe Close and make offers of new homes. This will also enable residents to make choices on kitchen and bathroom specifications and other design amendments.
4.3A small number of residents have indicated a desire not to move into a new home on the new development. Reasons given have included the need for specialist accommodation, wishing to move near family elsewhere in the city and wishing to remain with the Council / Salix Homes as a landlord. In order to give these residents adequate opportunity to find a new home of their choice it is requested that these residents are given priority rehousing and offers are made in line with existing allocations policies.
4.4Statutory Homeloss and Disturbance payments should be made available to residents moving from within the identified phasing. Salix Homes will also need to suspend letting to properties across the estate on a phased basis to help manage the relocation process.
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4.5The Council has developed a successful pilot in other clearance areas of using temporary / short term tenancies to occupy empty properties with applicants in acute housing need. The continued occupancy of these homes significantly reduces the negative impact associated with empty properties whilst helping to maintaining rental income and minimise any negative impact on the Housing Revenue Account during the redevelopment period. It also helped provide short term accommodation to applicants in acute housing need. It is recommended that Salix Homes adopt a similar arrangement and that permission to re-let stock on a short term tenancy is approved.
4.6Salix Homes will adopt an intensive approach to managing the neighbourhood in transition. Best practice around the management of empty properties developed with the Manchester Salford Pathfinder and the use of the Ordsall Langworthy co-located team will concentrate neighbourhood management resources into the clearance area when most required. A Residents charter, detailing the wider rehousing offer will also be developed with the residents in the first phase and residents in the Pendleton Steering group. A Pendleton Rehousing Solutions group of partners has been established to ensure all housing partners are working together to maximise housing choice for residents affected and manage the rehousing process.
5.0Acquisition of Private Homes
5.1The Council will be required to acquire 33 privately owned or leased properties sold previously under Right to Buy legislation to obtain vacant possession of the sites. The first 5 private homes on the High Street estate are located in Holcombe Close and it is recommended that Urban Vision is instructed to acquire the properties by agreement.
5.2In order to improve the housing offer to owners occupying properties on the estate the Council is working with Great Places to bring forward eight homes in the new development to initially be made available to residents affected by clearance on a shared equity basis.
5.3It is further recommended that eligible owners affected by clearance are also offered the option of accessing additional relocation assistance under the conditions detailed in the Private Sector Housing Assistance Policy 2006 (amended 2008).
6.0Conclusion
6.1The Private Finance Initiative Outline Business Case identified the demolition of 891 properties to provide redevelopment opportunities that will start to transform Pendleton and help deliver the wider regeneration of the area. Obtaining vacant possession of these sites will be the council’s responsibility and risk under the terms of the project agreement. The ability to bring forward new affordable housing development on the Lilac Court and Fitzwarren Court sites provides an early opportunity for residents living in this area to be offered new homes, for Salix Homes to commence the early clearance of part of the estate and help manage this risk.
6.2Analysis of the Housing Needs Assessment suggests that Holcombe Close is identified as the first phase of clearance and that further phases should be identified as the new affordable homes are developed in line with the rehousing plan.
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KEY COUNCIL POLICIES: Housing, Neighbourhood Renewal & Regeneration
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EQUALITY IMPACT ASSESSMENT AND IMPLICATIONS:- An Equality Impact Assessment has been carried out to the Outline Business Case and will be reviewed following the submission of detailed proposals. Work to support the Equality Impact Assessments has been carried out with partners to build up the profile of resident’s affected (Salix homes ‘’Getting to know you’’ customer survey) and a project group has been established with the Resident Steering group and Independent Community Advisors looking specifically at how we work withhard to reach groups.
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ASSESSMENT OF RISK: Medium
Risk: Lack of rehousing choice delays clearance / site assembly and ability to deliver regeneration of Pendleton.
Mitigation: Early consultation has already identified properties subject to clearance and started to develop rehousing solutions with residents. The Outline Business Case and procurement process has already identified significant numbers of new affordable housing to be made available to residents affected by the proposals. The Council and its partners are working to bring forward additional choice and an improved rehousing offer that includes some early new build Housing Association developments such as the Lilac Court and Fitzwarren Street sites. Approval of further consultation and offers will give clarity to residents, increasing rehousing choice and certainty through early allocation of new homes. A ‘Charter of Commitments’ is also being developed that details the offer to residents and the additional consultation proposed will further improve residents’ understanding of proposals.
Risk: Uncertainty over level of affordable housing funding allocation.
Mitigation: Early bids to the National Affordable Housing Programme have beenapproved by the Homes and Communities Agency for the Fitzwarren and Lilac Court Sites. Further bids are to be developed based on an assumed programme of redevelopment through the Local Investment Plan / single conversation. Increased certainty over phasing will improve deliverability of the scheme and increase the likelihood of accurate funding allocations.
Risk: The inability to bring forward a phased approach to rehousing leads to delays and a piecemeal approach to redevelopment, weakening the advantages obtained by a comprehensive approach to development and impacting on the sustainability of the development.
Mitigation: Delegation of phasing to the Pendleton Project Board maximises the opportunity for a successful solution to be developed for the area and links this through to open space, education and leisure facilities that are being proposed through the masterplan.
Risk: The inability to bring forward a phased approach to rehousing leads to blight and increased housing management costs.
Mitigation: An Intensive Neighbourhood Management Plan has been developed by Salix Homes to ensure resources are focused within the clearance area during the rehousing process. Delegation of phasing to the Pendleton Project Board will also ensure that adequate resources are managed correctly and the impact of empty properties Is minimised.
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SOURCE OF FUNDING: Public Sector Housing Capital Programme.
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LEGAL IMPLICATIONS: Norman Perry, Land and Property team
Further Legal advice will be obtained by Salix Homes on the use of short term tenancies in regeneration areas to ensure the council’s position is protected, in view of the fact of the further risk that terminating tenancies in these circumstances may occur.
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FINANCIAL IMPLICATIONS: Nigel Dickens, Principal Group Accountant
The report to Cabinet ‘Pendleton PFI Outline Business Case Financial Affordability’ June 2008 outlines resource requirements to meet the Council’s obligations within the land assembly programme. Resources to fund the first phase of tenant relocations, acquisitions, demolitions and statutory compensation have been identified within the 2009-10 Public Sector Capital Programme.Any variation to the financial impact of the demolition proposals to the Housing Revenue Account will be considered upon submission of detailed proposals frombidders in November
OTHER DIRECTORATES CONSULTED: A Corporate Impact Working Group has been established to assess the implications of the Pendleton proposals.
COMMUNICATION IMPLICATIONS:
The Private Finance Initiative project team has established a Communications Group that has produced a Communications Strategy to manage marketing and publicity issues within the project. Council marketing officers who sit on this group have recommended that a press release is not actioned until the first phases of residents are moving into new homes on the Lilac Court / Fitzwarren Street sites.
Considerable consultation with residents, including home visits has already taken place. Interim feedback has been provided through the Private Finance Initiative newsletter that goes to every home in the Private Finance Initiative area. The Pendleton Resident Steering group meet monthly to consider and advise on resident communication issues.
CONTACT OFFICER:
Paul Longshaw, Private Finance Initiative Project Director
Email:
Phone: 0161 922 8715
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WARD(S) TO WHICH REPORT RELATE(S): Langworthy
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