A bid to remove the affordable homes element of a new South Cumbrian estate is set to be approved because they are not financially viable.
Members of Barrow in Furness local area planning committee for Westmorland and Furness Council are recommended to approve modifying a legal agreement made with Harry Barker Properties Ltd for the Dalton development.
This will involve the removal of the requirement to provide four affordable homes on the site, opposite Greenhill Ponds off Greystones Lane.
Instead, according to council documents, it is proposed the developer contributes £63,000 to the council for the provision of offsite affordable housing provision.
A supporting statement submitted on behalf of the developer said: “Since work commenced on site, it has become apparent that abnormal costs (particularly with regard to the adverse ground conditions including the need for retaining walls and removal of surplus material) and associated increase in construction costs, have significantly increased to the extent that the scheme is not providing sufficient incentive for the applicant to continue to carry out the development especially with the delivery of the affordable units.”
In October 2019 a planning application to construct up to 36 homes on the site was approved by Barrow Borough Council and construction is a little over half complete.
Council documents state the submitted appraisal shows that with the forecast profit being 4.64 per cent with the delivery of the four affordable units, this only rises to 8.45 per cent if the obligation is removed.
This profit is still less than half of what would typically be expected in a viable development, around 15% to 20% profit, according to council documents
The report prepared for the committee says the applicant has demonstrated through their appraisal that it is not financially viable to deliver the agreed affordable housing units, and this has been peer reviewed and verified by a specialist consultancy.
It adds: “Should it be minded to retain the requirement, it has to be considered that the implications of this are likely much more harmful than omitting the provision.
“An unfinished site would be problematic for existing residents and would reduce the overall housing delivery if never completed.
“Had the appraisal been provided prior to granting planning permission, it is likely the development would still have been in accordance with the Local Plan, as it does make allowances for such viability issues, which are strong material planning considerations.”
Council documents say members may have concerns that this proposal sets a precedent that could result in similar applications, leading to the supply of affordable housing being compromised.
However, each application, as in this case, would be carefully scrutinised by a specialist and each determined on its merits, the report from planning officers adds.
The supporting statement from the developer adds: “The proposal will benefit the local economy during the construction phase and because of increased spending from new residents; provide housing fulfilling the social role; and is of an approved design in compliance with the environmental role.
“On balance, it is considered that the adverse effects of allowing this application do not significantly and demonstrably outweigh the benefits of the proposal.”
Members of Barrow in Furness local area planning committee will consider the modification to the section 106 agreement on April 9 at Barrow Town Hall.
