Beware a switch in mood on renegotiating section 106 agreements • A rise in the building of teeny weeny homes for normal sized people • A new book on the Shard is a fitting epitaph for Irvine Sellar
Developers in London facing falling sales and rising costs beware. Renegotiating section 106 agreements may no longer be the easy way to stave off penury. You can sense the mood shifting. London mayor Sadiq Khan’s condemnation of Wandsworth Council last week for rolling over to demands from Battersea Power Station to cut 250 affordable units is just one jink toward a tougher era. Another is the post-election change of attitude towards housing young folk. At the London Real Estate Forum this month GLA development director Fiona Fletcher-Smith made it clear the GLA will be shifting emphasis towards assuaging the housing needs of the hordes of young electors who upset Theresa May’s plans for a strong and stable Brexit exit. Even Tory Westminster council has taken to demanding affordable homes be built on site, rather than pocketing cash in lieu. Jeremy Corbyn will approve. Post-Grenfell Tower, no council is going to dare take a soft line on affordable provision, are they?
Until now London councils were seen as an easy mark, when it came to renegotiating section 106 agreements. Wandsworth in particular, it seems. A court case settle this month will see Minerva collect £3.8m plus interest from Chinese state developer Greenland. The latter failed to push for an increase in density, after buying the Ram Brewery site in Wandsworth from Minerva in 2013 for £135m. Planning permission for 661 flats had been gained in 2014 after seven years by the company taken private in 2011 by Delancey and US fund Ares. An overage clause in the contract would have paid Minerva £200 for every square foot of extra space Greenland was clearly expected to gain in a resubmission made obligatory by the sale agreement. The Chinese failed to resubmit. So Minerva gets paid £3.8m and nothing extra gets built. A testament to the confidence Minerva had in the ability of anyone to push Wandsworth into higher densities. Anyone but the Chinese that is.
Teeny weeny homes for normal sized people
May someone “up there” forgive Legal & General’s proselytising boss Nigel Wilson, who seems to feel the answer to the housing crisis is to set up a factory in Leeds to churn out matchbox-sized prefabs for eager housing associations. (Nige, you can certainly make better built homes, but there is no shortage of bricks and blocks). On 12 July, Richmond Housing Association will be showing visitors around L&G’s factory where their 26 sq m LaunchPod flats are assembled. Actually let’s not be too harsh on Wilson. A man who has just hired a woman from Rolls-Royce called Rosie Toogood to run the factory must have good intentions. Rosie will presumably demand standards to outmatch similar sized matchboxes launched today at the Building Research Establishment, which should perhaps be concentrating on other matters. The KODA house comes from Estonia. “The house feels twice as big from the inside. It’s splendid for 1-2 dwellers and a pet,” say the makers. A pet mouse presumably. Last month an American woman living in a 25 sq m home sighed to a newspaper: “My wash basket dominates the flat. There is nowhere to put it.”
Irvine Sellar’s entertaining epitaph
Irvine Sellar always used to respond to queries about the cost or value of his developments with the same reply: “Yea, that’s about right, but just say ‘rumoured’ will you?” A habit that shows up in a 344-page book on the life of the developer, who died in February aged 82. The Shard, the vision of Irvine Sellar (Constable, £30) by Howard Watson contains lots of rumoured numbers on Sellar’s greatest achievement, the construction of the 1,016ft tower in Southwark. But this fluent and entertaining book is essentially a biography of a poor boy made good. A boy who began by making money from his chums by challenging them to drop a penny into a bucket of water containing a half-crown. If the penny covered the silver coin, they got the half crown. The laws of refraction ensured Sellar almost always won. The heart of the tale is of course the battle to build the Shard. A must-read for anyone involved or interested in the perils of development.
Peter Bill is the author of Planet Property and a former editor of EG. Follow him on Twitter
