Affordable housing issue with Walthamstow estate regeneration

Mick Ferris
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A developer set to make a £14million profit rebuilding a Walthamstow estate claims it cannot afford to meet the council’s affordable housing target.

In 2016, developer Countryside won permission to regenerate Wood Street’s Marlowe Road Estate, replacing 298 low-rise flats around Northwood Tower with 448 new homes.

Last year, after more than 300 flats had already been built, Countryside won permission to squeeze an extra 150 homes onto the site after arguing the original plans would cause a £10.5m “deficit”, reducing the proportion of affordable homes from 56 per cent to 45 per cent.

While more than 100 neighbouring residents objected to replacing planned low-rise housing with blocks of up to eight storeys, Waltham Forest Council agreed the change to ensure the project was “financially viable and deliverable” and to prevent “indefinite” delays.

However, documents obtained by the Local Democracy Reporting Service (LDRS) show that Countryside’s claim of a £10.5m deficit was based on a target profit of £14m – about ten percent more than the £89.9m overall cost of rebuilding the estate.

The documents, only released by Waltham Forest Council after a rejected Freedom of Information request and an appeal to the Information Commissioner’s Office, show seven months of negotiations over whether Countryside could increase the proportion of affordable housing from 45 per cent to 50 per cent.

Waltham Forest Council and the Mayor of London both have a target of 50 per cent affordable housing for large developments, with the caveat that a lower percentage is acceptable if the developer can prove this would not be “viable”.

A month before the council’s planning committee approved the altered scheme, the council and Countryside finally agreed the extra 5 per cent affordable housing was not possible as the scheme was £1.6m in deficit.

The final agreement came after Countryside’s surveyor accepted a much higher predicted value for the new properties on the estate but continued to insist construction would take almost double the length of time estimated by the council.

In response to a request for comment, the council’s cabinet member for housing Ahsan Khan said: “We are looking at all options to increase the amount of affordable housing for local residents.

“We aim to provide 50 per cent affordable homes on all council developments [but] sometimes conditions change while a project is underway and we need to be pragmatic.

“We do not take any proposals to reduce the number of affordable homes at a development lightly. There is a strict process including independent viability surveyors and, where applicable, the Greater London Authority viability team to carefully scrutinise any such proposal.

“This includes a late-stage review when a project with less than 50 per cent affordable homes is near completion, to look again at whether the number can be increased. We will always push for the maximum possible.”

Last month, the council agreed to buy 47 shared-ownership flats in a block that has yet to be built on the estate, using Greater London Authority grant money, after Countryside again warned that failing to do so could cause a “significant delay” to construction.

Waltham Forest Council also refused a Freedom of Information request for its viability assessment of two large towers in a development known as The Mall, in Walthamstow town centre, although this was later released through a request to the Mayor of London.

The assessment shows that in 2020, The Mall’s developer Capital & Regional argued that, despite a 13 per cent predicted profit, it could not provide more than 31 per cent affordable housing.

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Mick Ferris

Editor Email: mickferris@yellowad.co.uk