Agenda item
CO1 Redevelopment - Update
Minutes:
The Housing Development Manager
introduced the report and stated that this was a collaborative
report that proposed the demolition of the current CO1 building and
subsequent redevelopment into 82 new homes. He stated that this
report was being brought to the Committee early in the process, but
further reports would be presented as the scheme progressed. He
explained that the size of the project had been analysed and the
current proposals were most financially viable and were the best
fit in terms of planning requirements.
The Housing Development Manager commented that the existing use of
CO1 as offices had now finished, and the proposed redevelopment
would meet the Council’s aspirations in regards to place
shaping. He added that the proposal would also contribute
approximately £2.8million to the General Fund. He stated that
the design would be compatible with the nearby Seabrooke Rise
estate, and highlighted point 3.2 of the report which showed that
the current building was nearing end of life and there was reduced
demand for office space in the area. He stated that the team had
looked at market sale for the site and private rented housing, but
the team had found these options were not financially viable. The
Housing Development Manager highlighted point 3.4 of the report and
stated that the project was currently in the design development
process, with consultants being appointed, and the same architects
who designed the new Civic Offices building. He stated that they
would be working to refine the design and cost plan, but would
engage with residents through online consultations and in-person
events before submitting a planning application.
The Housing Development Manager felt that this could be a
challenging site due to proximity with the Network Rail line and
the bridge, which could make demolition difficult, but stated that
it was possible as much more challenging sites were regularly
developed in London. He added that a detailed assessment of how the
proposed site and the CO2 building would relate to each other would
be undertaken, as well as a sustainable power strategy. He
mentioned that the design process would be iterative, and could
include some under-croft parking as well as a roof garden for
residents. He drew the Committee’s attention to the table at
3.14 of the report which outlined the estimated costs involved,
including £2.8million land cost and £21.6million
construction cost. He explained that the team had considered all
options for the site including sale of the land, private rented
accommodation and TRL acquisition, but had found that the most
financially viable option was through the HRA, as this provided
more flexibility over a 30 year period. He highlighted 3.23 of the
report which showed that there would be a small surplus from the
project over this time period, but the units would be set within
affordable housing levels and equivalent to other council
properties. He summarised and stated that 3.29 of the report
provided an indicative programme, which showed that construction
would start in September 2023, if a planning application was agreed
in summer 2022.
Councillor Fletcher thanked officers for providing a clear and
concise report. He queried if officers would choose that site to
build on, if they had the freedom. He also asked what safeguards
would be implemented to ensure the project was delivered on budget.
He felt that although the rent levels would be limited to
below-market value, this might still be too expensive for some
local residents, and queried how the team would ensure the new
houses were utilised by local people. The Housing Development
Manager replied that it was an iterative design process, but each
Royal Institute of British Architects (RIBA) stage would be
reviewed and cost plans would be controlled through consultants and
the project management team as the scheme developed. He stated that
there were risks associated with all developments, for example
changes to the borrowing rate, but these costs would be tracked
rigorously. The Assistant Director of Housing added that the new
homes would be allocated using the housing allocation list.
Councillor Fletcher stated that building regulations when CO1 had
been built were not as stringent compared to modern day, and asked
if this would increase the number of collateral challenges. The
Housing Development Manager replied that there could be some
challenges on the site due to building regulations, but the
technical team had much experience with these types of challenges,
due to their experience working on projects in London. Councillor
Fletcher questioned if officers had decided on a rental price. The
Housing Development Manager stated that the rent level would be
decided based on the assumptions made within financial parameters.
The Strategic Place Adviser added that there would be strict
safeguards in place to ensure the project was managed on budget,
and as this was an HRA scheme there would be high levels of demand
and subsequent income. He stated that although there was still a
level of risk this was lower than if the site went through the
market sale process.
Councillor Redsell highlighted point 3.13 of the report and queried
why the site would be challenging due to the proximity of the
railway line. She felt that there were numerous housing projects in
Grays, Stanford-le-Hope and East Tilbury that were close to railway
lines, which had been completed successfully. She also questioned
if the under-croft parking would be for residents only. The Housing
Development Manager replied that if there was under-croft parking
included in the scheme, this would be for residents only as the
scheme would sit within its own footprint. Councillor Ononaji
questioned if the Council had considered the cost of maintenance of
the building over a 30 year period. The Housing Development Manager
replied that the cost of maintenance was included in the financial
viability assessment, which used local averages and accounted for
the cost of inflation. He stated that although the team could not
foresee interest rate changes, the team used accurate predictions
to make a best estimate. The Strategic Place Adviser added that
Thurrock used standard, national methodology to predict interest
rates, and although these figures could not be exact, it utilised
the best economic indicators available. Councillor Pearce
questioned how long it would be until residents were living on the
site. The Housing Development Manager replied that the indicative
programme suggested building would start in September 2023 and
would welcome residents in 2025.
The Chair stated that the Leader had recently conducted a BBC Essex
interview during which he had spoken about the CO1 redevelopment
proposals. She explained that the Leader had indicated the number
of flats could increase to 94, which would be a 15% increase, or up
to 100 flats, which would be a 20% increase. She asked if a 15%
increase in the number of units would affect the financial
viability of the proposal, as point 2.2 of the report suggested
that the original number of 82 new flats was optimum. The Housing
Development Manager replied that as the design process was
iterative the number of homes could change as the design was
developed. He stated that as the report had been deferred from the
January Housing O&S meeting, the figures dated from then, but
no detailed analysis had been carried out regarding an increase in
the number of units. The Chair questioned if the report would come
back to the Committee if additional houses were proposed for the
site. She asked if this suggestion would affect the under-croft
parking or proposed roof garden. The Housing Development Manager
replied that the report would come back to the Committee before a
contractor was procured, but detailed design work had not yet been
undertaken. The Strategic Lead Finance added that if additional
houses were agreed, this scenario would be run through the
financial viability model. The Strategic Place Adviser added that
the figure of 82 houses was an approximation, but a report had been
submitted to Cabinet which outlined this figure. He explained that
an increase in the number of houses might not significantly affect
the financial viability of the scheme, but could affect the
planning permissions.
Councillor Van Day asked what the smallest square footage for the
houses would be, and asked if additional units would make the
houses smaller. The Housing Development Manager replied that the
houses had to meet the minimum space standards, which were set out
by national government, and was approximately 50 square metres or
500 square feet for a one bedroom flat. The Chair questioned the
build cost and felt that there could not be an overspend as there
would only be a surplus of £1095 per flat per year if the
project was brought in on budget. She queried if the cost of
demolition had been included in the build cost and if an allowance
had been made for inflation. The Housing Development Manager
replied that the predicted costs included the cost of demolition,
construction, contingencies, and legal fees. He added that RIBA
produced cost predictions and undertook market research regarding
inflation and all costs were based on their professional
judgement.
The Chair asked about the timeline of the project and questioned if
a report would be brought back to the Committee before the project
went to Planning Committee. She felt the timescales would be tight
as the next Housing O&S Committee wasn’t scheduled until
summer. She also felt concerned regarding the financial viability
of the project as it utilised HRA monies. She stated that there
were thousands of people on the waiting list of a house, and felt
that Thurrock Council should be building more homes for these
people, but was worried about costs associated with the project.
The Housing Development Manager explained that a report would be
brought back to Committee before a contractor was procured.
Councillor Fletcher felt that although the report had been well put
together, he felt it was a risk and could risk HRA money. He added
that he would like to see more clarification regarding the
additional homes that had been suggested by the Leader during his
radio interview. The Strategic Place Adviser stated that the report
provided officers best current advice to both O&S and Cabinet,
and stated that the detail contained within the report might change
as the design process was iterative. He added that any building
project could be a risk, but the project could be more flexible
using HRA money as it would benefit local residents.
The Chair thanked officers for the report and the Committee agreed
that a report on the project would be brought to Committee at the
first meeting of the municipal year.
RESOLVED: That the Committee:
1. Commented on the proposed redevelopment of CO1 to be 100% funded
through the HRA.
2. Noted that the scheme was to be directly delivered by the
Council and the properties to be owned and managed by the Council
through the HRA.
3. Noted that consultants are to be appointed to take the scheme
through to planning submissions, subject to approval and
consultation.
The Housing Development Manager and Strategic
Place Adviser left the meeting at 8.01pm.
Supporting documents: