Council ordered to disclose Heygate redevelopment’s affordable housing details
Published by Max Salsbury for 24dash.com in Housing and also in Development, Local Government
Southwark Council agrees Compulsory Purchase Orders for Aylesbury and Heygate estates
By Paul Coleman
A judge has ruled that Southwark Council and developer Lend Lease must publicly disclose hitherto confidential information about the viability of affordable homes in a controversial south London redevelopment scheme.
Judge Nicholas Warren, presiding over an appeal by Southwark Council to an Information Rights First Tier Tribunal, ruled on Friday (9 May) that Southwark and Lend Lease must decide within 28 days about the public disclosure of the information.
The information is contained in Lend Lease’s confidential Viability Assessment of its 2,500-home Heygate Estate redevelopment scheme, a major part of Southwark Council’s regeneration plans for the Elephant and Castle area.
Judge Warren said local people must have access to such information if they are to take part in regeneration planning. The judge indicated such disclosed information could include details of the planned sale of new Heygate homes to private purchasers and to social housing providers.
Lend Lease announced last month that the first phase of 360 new homes had been offered for private sale. One-bedroom apartments achieved initial release prices of £380,000.
Under Environmental Information Regulations, Judge Warren said: “There is a countervailing public interest in ensuring that social housing providers obtain a reasonable deal – and in actuality, Southwark, who are privy to the calculations, would almost certainly ensure that their partners, Lend Lease, did not take advantage of social housing providers.”
On the Viability Assessment – a document headed ‘Strictly Private and Confidential’ - the judge concluded: “In our judgment the importance, in this particular project, of local people having access to information to allow them to participate in the planning process outweighs the public interest in maintaining the remaining rights of Lend Lease and those subcontractors who contributed to the document.”
However, Judge Warren accepted that global developer Lend Lease’s detailed financial model for its phased redevelopment of the Heygate Estate - contained in Appendix 22 of the Viability Assessment - “is a trade secret, a commercial interest, requiring protection”.
Despite the ruling largely favouring disclosure, a Southwark Council spokesperson said: “We’re broadly pleased with the decision. Without some commercially sensitive information remaining private, developers could simply refuse to work with councils, leaving boroughs without the housing and regeneration we all need.”
Lend Lease, in its own submissions to the appeal tribunal, stated: “Disclosure of the remainder would not confer any significant public benefit, but would seriously damage the commercial interests of Lend Lease, and would endanger the viability of the project.”
Lend Lease has said it will “propose to deliver the maximum level of affordable housing that can be achieved within the bounds of financial viability”.
Jerry Flynn of the Elephant Amenity Network, a local group campaigning to see more openness in regeneration and for more genuinely affordable homes, said: “All over London developers routinely use viability assessments to avoid building affordable housing and then hide the reasons behind commercial confidentiality.”
Flynn added: “Any developer who claims they cannot build the affordable housing that local policy requires should be refused planning permission unless they make their viability assessment of the project fully public.”
Southwark Council had stated in its Core Strategy of 2011 that at least 35% of new homes in the Elephant and Castle area should be affordable housing. Within this 35%, half would have to be ‘social rented’ and half ‘intermediate’.
Completed in 1974, the Heygate Estate once housed more than 3,000 people in more than 1,200 households. Of these, 1,013 were council-rented flats and maisonettes.
The 1,013 council homes will be replaced with 300 new homes under shared ownership, 79 at ‘social rent’ (40% of market rates), with another 212 at 50% of market rates.
The vast majority of the 2,500 new homes will be privately sold. The first buyers could be able to move in at the end of 2015.
Previously, Lend Lease and Southwark jointly contended the Viability Assessment proves their redevelopment of the Heygate would be economically unviable if it was required to provide 35% of new housing in the form of ‘affordable homes’.
But, in January 2013, Southwark councillors, acting on advice from the District Valuer Service that conducted the Viability Assessment, granted Lend Lease planning permission for a Heygate redevelopment scheme that would provide 25% affordable housing.
Community groups, campaigning for higher local levels of genuinely affordable homes, had formally asked to see Lend Lease’s Viability Assessment in May 2012. Initially, the Council refused on grounds disclosure would expose commercially sensitive information and harm key elements of its July 2010 regeneration agreement with Lend Lease.
In May 2013, during the course of an investigation by the Information Commissioner - the independent authority upholding information rights in the public interest - Southwark Council agreed to disclose part of the Viability Assessment.
But, in July 2013, the Information Commissioner ordered Southwark to publicly disclose the entire Viability Assessment after deciding on balance that the public interest favoured disclosure and outweighed possible harm to the Council’s regeneration plans or to Lend Lease’s commercial negotiations. Southwark then appealed to the Tribunal against the Information Commissioner.
Once Southwark and Lend Lease have agreed on what information to disclose, they must then secure the agreement of the Information Commissioner.
Southwark Council’s spokesperson added: “In terms of the information required to be disclosed, we are looking at the practical implications before deciding on our next steps.”
The Viability Assessment is the second major public information episode involving the Heygate Estate. An unwittingly un-redacted and leaked version of the Regeneration Agreement disclosed the Council had sold the 22-acre site to Lend Lease for approximately £50 million.
Local objectors to the Heygate scheme said this previously confidential sale price for prime development land in central London represented a bad deal for the people of Southwark but a real bargain for Lend Lease.
Southwark decanted Heygate tenants as Lend Lease sought planning consent for their redevelopment. A number of leaseholders were evicted after compulsory purchase orders were secured.
Some tenants and leaseholders were re-housed locally in new affordable homes but others were dispersed outside of their traditional neighbourhood.
Paul Coleman is a freelance journalist who blogs at London Intelligence.