The developer of newly-built flats at Elephant and Castle has tried to pay Southwark Council millions of pounds to jettison its affordable homes requirement.
Developer Neobrand has offered the council £5.9 million to drop its affordable housing in the Ceramic Building on Newington Causeway, and convert the flats for sale or rent on the open market.
“While we won’t comment on individual cases which are going through a formal planning process, I will say that we place requirements for genuinely affordable homes on developers for a reason,” said Cllr Helen Dennis, cabinet member for the climate emergency and sustainable development.
“We need more genuinely affordable homes in every residential development in the borough. Any attempt by a private company to avoid meeting their agreed obligations on affordable housing will be robustly challenged,” she added.
The multi-million-pound development at SE1, which was approved in 2018, contains 16 flats intended for use as affordable homes, alongside a new 140-room Travelodge, retail space and 48 residential units. These 16 affordable homes, located on the 12th and 15th floors, were to be split between shared ownership and social rent.
Neobrand says it needs to place the flats on the open market, as it cannot find a housing association that is prepared to take them on.
Through agents TMLand, Neobrand approached 26 housings associations, but none would make an offer.
They also approached Southwark Council directly who said the opportunity “isn’t for us”.
Reasons cited were that the size of the opportunity was “too small” for several housing associations, the height of the 24-storey building and the service charge for social rented and shared ownership flats.
“It should be noted that since the discussions with the housing associations I understand the service charge has risen dramatically due to the building control requirement to have a 24-hour concierge for fire safety,” wrote Tom Mulligan of TMLand. “This would make the scheme even more unviable for any housing association.”
He added: “TMLand does not believe that this building is suitable for either social rented or shared ownership affordable housing, and it is unlikely to be saleable to a housing association.”
A decision from the council on whether the developer can proceed is due before 14 April.
One two-bedroom apartment in the Ceramic Building is currently being offered for rent at £2,795 per month.
Last year the council agreed that the communal children’s play space on the top floor of the tower could be converted into an extra home for private sale.
“It is understood the placement of children’s play space at this level has become unfeasible due to concerns around building regulations and fire safety compliance,” wrote council planning officers.
“The applicant has proposed a payment in lieu to offset the agreed provision of children’s play space, as well as for affordable housing.”