industry news
Build to Rent to supply 1000 London homes
Two multi-million pound deals have been signed that will see over one thousand new homes built in London for private rent. The schemes are the latest deals under the
Government’s Build to Rent scheme and are being supported with more than £150m of public funding. The 1,046 new homes are part of a package
of Government measures which it hopes will deliver one million new homes by 2020. The schemes will provide 636 homes at The
Newfoundland Building, Canary Wharf in Docklands and 400 homes at Ferry Lane, Walthamstow in north east London. They are both located close to existing underground stations and will provide a mix of one, two and three bedroom homes. The properties are due to be completed in 2019. Housing and Planning Minister Brandon
Lewis welcomed the move as an important boost for renters in London: “As a global city filled with opportunity and links to the rest of the world, there is a real demand for good quality homes available to rent on flexible terms in the capital. These two new deals will provide a big boost to housing and help meet
“As a global city filled with opportunity and links to the rest of the world, there is a real demand for good quality homes available to rent on flexible terms in the capital” – Housing Minister Brandon Lewis MP
the needs of tenants well into the future.” The Build to Rent fund was launched by the
Government to “accelerate housing provision and to help developers produce large scale, quality homes specifically for the private rented sector.” Since its launch over 5,800 homes have been contracted through Build to Rent with investment totaling £66m. The Homes & Communities Agency’s head
of transactions Gareth Blacker commented on the two new London projects: “This is good example of how the Agency is able to support major cities to create successful places for people to work and live. This investment in the capital helps to meet local priorities for housing and growth, supports a wide range of construction professions working on the scheme, and gives greater choice to people who want to rent a high quality home in London.” The Build to Rent fund is a fully recoverable,
commercial investment where the Government will share risk or bridge finance to allow schemes to be built, managed and let. The investment can cover land, construction or management costs.
The UK needs to build 300,000 new homes a year to resolve the housing crisis, according to a House of Lords committee. The Economic Affairs Select Committee
released a report "Building More Homes" on 15 July stating the Government must amend its current housing target of 200,000 per year and grant local authorities and housing associations better access to funding and more decision power to meet the prevailing housing demand. Some of the recommendations in the
report related to lifting restraints on borrowing for local authorities and allowing them to set and vary planning fees, maximise the use of public land and levy council tax on developments that are not completed within a set time period. The Committee offered strong criticism of
the Government's reliance on private developers calling it “misguided,” and saying the private sector could not deliver the high volume of homes required.
“The private sector has neither the ability nor motivation to deliver the 300,000 homes needed” – Lord Hollick
Lord Hollick, chairman of the Committee,
said: "The country needs to build 300,000 homes a year for the foreseeable future. The private sector has neither the ability nor motivation to do so. We need local government and housing associations to get back into the business of building." The report noted that housing
North east HAs complete merger
Two housing associations based in the north east have merged to form a single 14,000- home landlord. Bernicia Homes, based in Northumberland,
has completed its merger with Four Housing Group, in Durham. The newly formed Bernicia Group has assets in excess of £500m with an annual turnover of more than £70m. Bill Heads, chief executive of Bernicia Group,
said “The enlarged group enhances our opportunity to do more for more local people.” The new group is one of the region’s
largest property management and development organisations, based in and committed to the North East. It works across
14 local authorities, from Berwick in the north down to Darlington, providing a range of homes and services to customers and communities. The landlord employs over 500 staff and
has plans to build 2,200 new homes in the region. With its specialist care and support services, Bernicia now works with over 60,000 customers a year.
“Bernicia Group has assets in excess of £500m and an annual turnover of more than £70m”
associations had been able to build homes in greater numbers than local authorities. The committee therefore supported the Government’s efforts to reclassify housing associations as part of the private sector saying HAs’ ability to borrow to fund new development could otherwise be at risk. The Economic Affairs Committee stated in
the report that one benefit of greater availablity of social housing would be the likely reduction in the housing benefit bill over the long-term. The committee also criticised cuts to
social rent calling them “short-sighted“ and concluded they were likely deter investment and reduce the available housing social and affordable housing stock long term. The report also suggested a cabinet
minister should be tasked with identifying and coordinating the release of public land for housing and that the National Infrastructure Commission should oversee the number of homes being built on such land.
www.housingmmonline.co.uk | HMM July 2016 | 5
Lords ups housebuilding target to 300,000
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