Agenda item

To consider a report concerning the development of 16-46 Cromwell Road, Redhill.

Councillor T. Schofield, Chairman for the meeting, in inviting the Portfolio Holders to introduce the report referred to this being another good example where they worked well together to implement their cross portfolio initiatives.

As with the Pitwood Park report above Councillors Mrs N.J. Bramhall and Mrs R. Renton Executive Members for Property and Acquisitions and Housing and Infrastructure respectively introduced this report as a joint development between their respective portfolio responsibilities.

Councillor Mrs Bramhall advised the Executive that the Cromwell Road site had been identified in the Redhill Town Centre Area Action Plan 2012 as a priority for regeneration. The proposal to develop this site had been approved by the Executive in April 2017 in principle and was designed to deliver 32 new residential units and modern ground floor retail units.

The flats would be sold on the open market on long leases and the retail units would be retained as commercial assets for letting out to as a revenue income. Overall the project was promoted for bringing forward the Council’s new housing and regeneration aspirations for Redhill.

Councillor Mrs Renton referred to the nature of the proposal being one to assist local people, where possible to purchase their own homes by delivering more affordable homes within the Borough. The Executive Member emphasised that the proposal would sell 16 flats, 50% of the new residential accommodation on the development, on a shared equity basis. The council would retain a 25% equity share at the point of first sale through a second charge.

RESOLVED that:

(i)            the Head of Property be authorised in consultation with the

(a)         Head of Finance

(b)         Executive Member for Property and Acquisition; and

(c)          Executive Member for Finance

to  proceed with a re-development of 16 – 46 Cromwell Road, Redhill that achieves a profit less than would be considered commercially viable to enable a financial contribution for off-site affordable housing (as detailed in the Exempt part of the Executive’s agenda) to be made;

(ii)          the Head of Property, in consultation with the Executive Member for Property and Acquisitions, be authorised to market and sell long leasehold interests of the residential flats at 16-46 Cromwell Road, Redhill, of which 50% would be sold on a shared equity basis with the Council retaining a 25% equity share; and

(iii)         these proposals be noted as replacing those agreed by the Executive in April 2017.

Reasons for decision: Since initial proposals had been presented to the Executive in April 2017, the indicative profit from the scheme had reduced.  As the Council’s purpose of redeveloping this site was only in part to help the Council to meet its 5 Year Plan aspirations to be financially self sufficient with the primary objective being to support the redevelopment of the site as a priority for providing homes that help address the local housing affordability challenge which was the reason for offering a reduced developer profit to enable a financial contribution to off-site affordable housing. Additionally, the proposal would provide housing for local people on a more affordable basis using the shared equity scheme.

Alternative options: To take a purely commercial approach to the development and seek to achieve a greater profit by selling all residential units on a full market value basis.