Grosvenor UK chief executive urges councils to back BTR
The economics behind build-to-rent schemes need to be better explained to local authorities and communities if they are to win planning approval, Grosvenor’s chief executive said today.
Speaking ahead of tonight’s Southwark Council planning committee meeting (where the company’s £500m Old Biscuit Factory scheme in Bermondsey is expected to be rejected), Craig McWilliam, Grosvenor’s Britain & Ireland chief executive, said he regretted the scheme had not been better explained.
“I regret that the benefits a build-to-rent scheme can bring more broadly are not being talked about,” McWilliam told EG’s Future of Real Estate podcast today. [What has been talked about is] only the fact that a scheme like that cannot deliver as much affordable housing as a for sale scheme, which would deliver homes that the majority of people who live and work around the site would never be able to afford”.
The economics behind build-to-rent schemes need to be better explained to local authorities and communities if they are to win planning approval, Grosvenor’s chief executive said today.
Speaking ahead of tonight’s Southwark Council planning committee meeting (where the company’s £500m Old Biscuit Factory scheme in Bermondsey is expected to be rejected), Craig McWilliam, Grosvenor’s Britain & Ireland chief executive, said he regretted the scheme had not been better explained.
“I regret that the benefits a build-to-rent scheme can bring more broadly are not being talked about,” McWilliam told EG’s Future of Real Estate podcast today. [What has been talked about is] only the fact that a scheme like that cannot deliver as much affordable housing as a for sale scheme, which would deliver homes that the majority of people who live and work around the site would never be able to afford”.
The mixed-use scheme on the 12-acre site of a former biscuit factory is up in front of Southwark Council’s planning committee this evening, with a recommendation from the council’s planning officers that it be refused planning approval because of the lack of a reasonable amount of affordable housing and its non-compliance with private rented sector tenure requirements in the 2018 New Southwark Plan.
Grosvenor’s proposals include 128,940 sq ft of business or industrial space, 40,849 sq ft of retail space and 1,217 residential units, with 27.5% of the habitable rooms available at an average discount to market rent of 25%.
The plans, designed by architects Kohn Pedersen Fox Associates, also incorporate a new 600-place secondary school. It would be the 340-year-old landed estate’s first BTR scheme.
McWilliam said: “We have worked very hard to talk to both the local community and to Southwark as an authority about the benefits that our scheme brings.
“It’s designed to try to create housing for the majority of normal Londoners who are unable to buy but aren’t ever going to be allocated social housing because there’s so little social housing available. So we are trying to address that squeezed middle.
“But inevitably the economics of that are that a build-to-rent scheme doesn’t produce as much profit as a build-for-sale scheme and therefore it doesn’t deliver as much affordable housing as the local authority would aspire to.
“I think that it’s a scheme where on the ground, it’s fair to say, there’s a lot of support for what we are doing, for how the development would reintegrate communities… and everyone aspires to see that happen.”
Listen to McWilliam talk about how developers need to win back public trust in the full interview here:
To send feedback, e-mail louise.dransfield@egi.co.uk or tweet @DransfieldL or @estatesgazette
