Part 1
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REPORT OF THE DIRECTOR OF SUSTAINABLE 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:
1. Notes the progress made on bringing forward affordable housing on
the Lilac Ct and Fitzwarren Street sites;
2. 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;
3. 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);
4. Approves the payment of statutory homeloss and disturbance
compensation to qualifying residents affected by the proposals;
5. Gives approval for the use of short term tenancies within the High
Street estate;
6. 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.
7. 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:
1.0
Purpose of report
1.1
The 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.
1.2
The 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.
2.0
Regeneration update
2.1
The 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.
2.2
A 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.
2.3
In 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.
3.0
Proposed first phase clearance area.
3.1
The 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
the first 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 Salford Shopping City and other key strategic
sites in the area.
3.2
It 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.
3.3
Consultation 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.
4.0
Managing the relocation process and the redevelopment area
4.1
In 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.
4.2
The 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.
4.3
A 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.
4.4
Statutory 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.
.
4.5
4.6
The 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.
Salix 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.
5.0
Acquisition of Private Homes
5.1
The 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.
5.2
In 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.
5.3
It 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).
6.0
Conclusion
6.1
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.
6.2
Analysis 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 with hard 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
been approved 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 master plan.
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 from bidders 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: paul.longshaw@salford.gov.uk
Phone: 0161 922 8715
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WARD(S) TO WHICH REPORT RELATE(S): Langworthy
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