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Affordable housing viability under the spotlight

Affordable housing viability under the spotlight

Tuesday 13 December 2022

Affordable housing viability under the spotlight

Tuesday 13 December 2022

Debate over Guernsey's 'affordable housing policy' came to the boil yesterday as the Development & Planning Authority decided to defer granting planning permission for 26 new homes at Briarwood after the developer said they couldn't provide any land for social housing.

Authority President Deputy Victoria Oliver and Deputy John Dyke voted to approve the application, whilst Deputies Sasha Kazantseva-Miller and Andrew Taylor said a delay was necessary to review the costs within an independent viability assessment.

That assessment had determined that providing 28%, or seven units, of developable land for affordable housing would render the scheme financially unviable as it would not guarantee a profit of at least 20%. Therefore, there was no requirement for affordable units under GP11. 

But Deputy Kazantseva-Miller described parts of the deal as “complete nonsense” and said she could not accept the provided viability figures “at face value”

However, Deputy Oliver argued that GP11 is “quite peculiar, has holes in it, needs changing” and questioned if the policy is practicable. 

The applicants have indicated they will appeal the deferral at an independent tribunal, arguing after the meeting that planning laws and guidance have been abided. 

Pictured: The open planning meeting for the application went late into the evening yesterday at Beau Sejour. 

The plans include constructing 26 homes, each with gardens and two car parking spaces, on an agricultural field and a back garden surrounding the St. Martin’s public car park off Grande Rue.

The developers also purchased the car park and would redesign and upgrade it at personal cost, including a drop-off and turning point for children attending St. Martin's Primary School, before handing it back to the States for public use. 

The cost of doing so was suggested as one of the reasons why an affordable housing contribution could not be made as part of the development.

A representative from Sarnian Property Holdings claimed that the developers “have never envisaged the car park as being an offset for GP11”.

Paul Nobes from Infinity Construction noted that the island “desperately” needs additional housing but agreed that GP11 was not linked to the car park: “It’s simply unviable.”

“We’ve spent three years working on this, following the guidance,” he added.

Deputy Sasha Kazantseva-Miller

Pictured:  Deputy Sasha Kazantseva-Miller thinks more detail is required to inform any viability assessment of the scheme.

Nevertheless, Deputy Kazantseva-Miller was critical of the viability assessment, saying: “I’m failing to see how the cost of developable land has been calculated…   we cannot trust the viability assessment to be accurate.

“[The scheme] does not provide all the costs and benefits to the States… the value of land has been fully accrued to the landowner… I really think land value are not reflective of GP11 provision.

“£250,000 to buy [the car park] then give it back to the States is complete nonsense… it’s a bad deal by the States’ Property Unit.” 

Deputy Taylor questioned if a mandated 20% profit on developments was “a realistic figure” given global increases in the costs of labour and building materials: “If everyone is seeing increasing costs, something has to give”. 

Planning officials claimed banks would be less likely to lend to projects with smaller returns due to increased risk.  

The cost of seven affordable housing units was calculated at £4.2m, but officials said an overall saving or increase in profit of £2m would be required to designate the whole scheme as viable. 

Beau Sejour

Pictured: Another open planning meeting will be required should an appeal from the developers fail if launched.  

Jim Rowles, Director of Planning, insisted that consultations with all the relevant parties, such as the Committee for Employment & Social Security and the Guernsey Housing Association, who were highly critical of the lack of affordable housing in the planning report, occurred as required. 

But Deputy Taylor then claimed that he understood that “procedure has not been followed” and wondered if the site design could be altered to ensure viability. 

Deputy Oliver then invited the developers to clarify the affordable housing position to the panel after they had already delivered their spoken representations, and afterwards denied former deputy Carla Bauer from making an additional representation as well. 

“I’m confident with the viability assessment… we just have to trust the figures,” she said whilst summing up. She also implied that the Guernsey Housing Association could’ve purchased the site itself to build affordable housing. 

Mr Rowles agreed that the lack of an affordable housing contribution did comply with the supplementary planning guidance by demonstrating non-viability. 

Express put questions to the DPA last week asking if the Authority stills supports GP11 in its current form, why developer profits are set at 20%, and if this could be changed to permit more affordable housing. A response is yet to be received. 

The DPA will now engage with the applicants for the development to review the costs in the viability assessment and reconsider access in the vicinity of Briarwood. 


Possible two-dozen new dwellings could come to St Martins

Viability threatens scale of affordable housing at Leale’s Yard

Deputy leading opposition to GP11 will "conclude research shortly"

Flexible GP11 "a mockery of policy - if developers can get around it"

Claims about social housing policy GP11 are "complete moonshine"

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