(Specify which) WARD/AREA/CITY (REF TO EM)

Princes Park Ward

STATUS - PUBLIC NH/21

Portfolio: Neighbourhoods and Housing

Executive Member/Director:

Councillor Marilyn Fielding / Tony Hunter

Date of submission: 21 February 2008

Subject: Granby Renewal Area,

2-24 and 1-27 Hatherley Street

Report No./Background papers:

EDR/15/08

Neighbourhood Renewal Assessment

Technical Appendices

Contact Officer:

Jack Coutts / Elaine Stewart

Executive summary:

The purpose of this report is to advise the City Council of the outcome of a Neighbourhood Renewal Assessment conducted in respect of properties 2-24 and 1-27 Hatherley Street which are located within the Granby Renewal Area and to seek authority to take forward the recommended option for the area
Background

A Neighbourhood Renewal Assessment has been conducted in order to arrive at a recommended course of action for the properties in Hatherley Street and adjacent land, situated within a declared Renewal Area where the Council has an obligation to consider the most appropriate use and future of the housing accommodation. The full NRA report and associated Appendices are provided as background papers.

The Granby Renewal Area was declared by the City Council on 29th November 1995 for a period of ten years, and was extended until the 31st March 2010 by a further resolution of the Executive Board made on the 11th November 2005. In declaring the Renewal Area, one of the intentions of the Council was to secure the improvement of housing conditions generally and by a number of means, so as to ensure that all housing in the area would be assured of an effective future of not less than 30 years, or where this was not feasible to replace that housing with new housing which would surpass that objective.

Since declaration of the Renewal Area the Council has gradually, and in close consultation with local residents and other stakeholders, developed housing solutions for different parts of the area. This has included, for example, a major Group Repair project at Nos 37 - 95 Beaconsfield Street and the clearance of other properties in Arundel Street, Cawdor Street, Ponsonby Street, Eversley Street and Rosebery Street with redevelopment of the cleared sites with new housing in most cases. More recently in conjunction with the Council's selected development partner Lovell, a comprehensive plan for the area known as the 4 Streets neighbourhood has been prepared.

It is important that the decision taken on the preferred outcome for Hatherley Street complements and supports the other major planned and completed investment in other parts of the Granby Renewal Area. It should also be taken in the wider housing context for the area, neighbourhood, and city.
Location

Hatherley Street is located in a triangular area situated between Mulgrave Street, to the East and Princes Avenue to the West and is shown on the attached plan at Appendix 1. Immediately to the North is an area of City Council housing built during the 1970's which underwent Estate Action work during the late 1990's, and which is due to be transferred to Liverpool Mutual Homes shortly.

Adjoining 2-24 Hatherley Street is a block of larger frontage properties containing 6 houses at 70-80 Mulgrave Street. Five of these properties 72-80 Mulgrave St were re-improved as large single family homes and brought back into housing use by Steve Biko Housing Association in 2006. Beyond this on the other side of Mulgrave Street is an area of social rented housing built on land cleared as part of the previous phases of housing action in the Renewal Area and earlier Clearance Area action.

On the southern edge of Hatherley Street Eversley Street and Mulgrave Street a new housing development by Steve Biko Housing Association is currently on site to provide a mixture of housing for shared ownership and social rent. This site was created by a combination of compulsory purchase for clearance and by Demolition Orders.

Finally on the Western edge of Hatherley Street lies Princes Avenue. This imposing frontage of larger three and four storey double fronted houses is also included within the boundary of the Granby Renewal Area, and also forms part of the Princes Road Conservation Area. The housing in Princes Avenue has undergone a transformation in recent years, progressing in many cases from largely low demand flats and HMO's into more desirable, popular, and increasingly expensive apartments. The investment in improved apartments for rent and sale in Princes Avenue properties has been largely undertaken by private developers.

The decline of Hatherley Street as a housing area and in such close proximity to the large scale private investment in Princes Avenue underlines the likely private sector assessment of very high risk associated with investment in these properties.

Adjacent to no. 27 Hatherley Street is the Al Rahma Mosque. Discussions have taken place over several years between Trustees of the Mosque and City Council officers regarding the aspirations of Liverpool Muslim Society for the extension of the Mosque and the services it provides to the Muslim community both locally and from further afield utilising the land on Rosebery Street to the rear of 1-27 Hatherley Street. This cleared site is substantially but not entirely in the ownership of the city Council following a previous programme of acquisition and demolition as a result of housing unfitness.

The use of the Rosebery St site is of significance both for the future of the Hatherley St properties and the Mosque and for this reason it has been included in the option appraisal process.
Neighbourhood Renewal Process

The Local Government and Housing Act 1989 introduced the concept of Renewal Areas, and introduced the statutory duty for housing authorities to carry out Neighbourhood Renewal Assessments - NRAs - when considering taking strategic action on whole areas of older housing, for groups of properties, or in some cases for individual houses.

The NRA is the recommended process which must be used by housing authorities when carrying out an appraisal of housing conditions to determine the most appropriate course of action for that housing. Guidance on the NRA procedure has been issued to local housing authorities [ie. Neighbourhood Renewal Assessment: Guidance Manual 2004 - September 2004], and it is under that guidance that this NRA report has been produced.

Further details of the NRA process are provided in Appendix 2.
Key Findings of the NRA

a) Information considered

To support the appraisal a range of relevant information has been obtained and used in examining each of the options. The information gathered includes:-

The views of residents and property owners
Individual property valuations.
Estimated costs of improvements.
Length of periods of vacancy.
Physical surveys of property conditions.
Property inspections under the statutory Housing Health and Safety Rating System.
Energy efficiency ratings.
Estimates for various demolition options.
Information on ground bearing conditions, and environmental contamination.
A series of required assessments, which are:-

Socio-Environmental Assessment.

Economic Assessment

Assessment against strategic housing objectives.

In addition several Appendices of background information have been compiled, and are available as background papers. All of this comprehensive information has been considered during the NRA.

b) Ownership details

In total there are 26 properties in the NRA. Eighteen properties are vacant, of which 15 are LCC owned, 2 are owned by Liverpool Muslim Society and 1 is currently in negotiations for acquisition by LCC. Four properties are owner occupied, two are RSL tenanted, one is RSL owned and let as an office to Liverpool Muslim Society, and one property is a privately rented house in multiple occupation.

c) Property condition

69% of the existing housing stock has been vacant for periods of between 1 and 14 years. The average period of vacancy is approximately 8 years as of November 2007.

The property inspections carried out under the Housing Health and Safety Rating System have found that there are multiple Category 1 hazards throughout the vacant and occupied stock. The number, type and extent of the hazards identified are sufficient to enable the Council to declare a Clearance Area if required. However, whatever option is decided upon the Category 1 hazards which have been identified must be eliminated as a statutory duty. This has implications for all the properties, including the owner occupied properties.

Estimates obtained from private surveyors (selected and instructed by the residents) on the likely costs of improving properties to the minimum Decent Homes Standard indicates that the average cost of renovating individual properties would vary between a minimum of £102,249 per retained property and a maximum of £117, 736 per retained property. These costs do not return an increased property valuation to justify that level of expenditure, based on current estimates.

The energy efficiency rating for the properties is low with an average SAP rating of 34. Because of the size, materials used, and method of construction of the properties the improvement of the SAP ratings to the Decent Homes Standard will be extensive and expensive. It will be very difficult to achieve a target SAP rating of 75 which would provide a sustainable level of thermal comfort.

Option Appraisal Process

a) Process description

The intention of the Option Appraisal process is to make transparent the logical decision making process of the Council in making housing renewal decisions. The process is intended to ensure that a range of valid and reliable evidence is used in arriving at the final decision, and lead to better structured delivery plans following the decision. Option Appraisal follows a series of logical steps laid out in the NRA guidance, and is in three main parts:

b) Socio-Environmental Assessment

The Socio-Environmental Assessment is a means of considering and identifying which of the Options produces the greatest social and environmental benefits for the whole community. The Options being considered in the NRA are scored against their ability to deliver the identified objectives or outcomes. Individual factors are considered on their ability to meet the objectives of the NRA and are weighed according to their level of importance/relevance in delivering the NRA outcomes.

c) Economic Assessment

The Economic Assessment requires the calculation of Net Present Values [NPV's] for each of the options being considered. The format and methodology for this is prescribed in the NRA guidance. The costs and benefits for each option over the next 30 years are calculated and discounted back to present day values. This generates a financial value, which can either be positive [Net Present Value] or negative [Net Present Cost] to enable the economic benefit or cost of different investment options to be considered. If the value is a NPV, the higher the value the greater the benefit; whilst if the result is a Net Present Cost the greater the cost the less attractive the investment.

Sensitivity Analysis examines the effect of possible changes to key variables in the costs or benefits. This identified where any option might be at risk if there is a significant change of relevant circumstances which will materially alter the initial result. For example, the costs of renovating existing stock may increase, or the buy in value of cleared sites for new construction might increase.

d) Strategic Fit Assessment

The final part of the Option Appraisal is to examine the degree of fit between the NRA Options being considered and the local strategic housing objectives. It is important that any decisions taken as a result of the NRA are consistent with the Councils strategic housing objectives. A series of key objectives or outcomes are identified that are relevant to the NRA and support delivery of the local housing strategy. These objectives are also allocated weighting factors according to their relative importance in securing the housing strategy through the NRA process. The results are summarised in tabular form.

Options considered

Identified Options for consideration in the NRA were

OPTION NO.

DESCRIPTION

No intervention action to be taken by the Council other than basic enforcement. Leave area to normal market forces.

Renovate all the existing 26 properties in Hatherley Street to the tenure appropriate 30 year life standard. Return all vacant properties to full housing use for either owner occupation or rent.

Demolish the block at 2-24 Hatherley Street and redevelop the site with 11 new houses. Retain 1-27 Hatherley Street and renovate all 14 properties to the tenure appropriate 30 year life standard, and return all vacant properties to housing use.

Demolish the block at 2-24 Hatherley Street, plus no's 1-9 Hatherley Street. Redevelop the site of 2-24 Hatherley Street with 11 new houses. Renovate the 9 retained properties at 11-27 Hatherley Street to the tenure appropriate 30 year life standard, and return all vacant properties to housing use.

Demolish all 26 properties at Hatherley Street, and rehouse all existing occupiers. Redevelop the cleared sites, plus the cleared site at Rosebery Street with approximately 37 new houses.

Demolish all 26 properties at Hatherley Street, and rehouse all existing occupiers. Redevelop the cleared sites with approximately 23 new houses. Exclude the site at Rosebery Street from the redevelopment.

Consultation / Residents views

Residents of the affected properties have been actively engaged with the Council in discussing the future for these properties through a series of meetings and individual consultations. Their views and interests are examined as part of the NRA process.

All of the residential occupiers who have expressed a view have agreed that taking no action on the properties is an unacceptable solution.

The views consistently expressed by residents who have attended discussions and workshops indicate that they all have a clear preference for either Option 2, 3 or 4, all of which involve retaining all or some of the existing properties. Residents are opposed to Option 5 and 6 which would lead to the demolition of their homes.

The table below summarises the collective views of residents on the agreed options.

Residents preferred option

[Ordinal rating: 1 = highest preference; 6 = lowest].

OPTION

These preferences form part of the Socio-Environmental Assessment aspect of the NRA, the full list of elements being

1 ) Residents aspirations
2 ) Community disruption
3 ) Better housing quality
4 ) Remove dereliction
5 ) Better quality environment
6 ) Healthier living conditions
7 ) Deliverable solutions
8 ) Longer term sustainability
9 ) Community safety

10) Tackle anti-social behaviour

The scores for all of these elements, including Residents Aspirations, go towards the overall Socio-Environmental ranking in the combined analysis. The views of other stakeholders, including Liverpool Muslim society and Steve Biko Housing Association, were also obtained and considered.

Options analysis

The scoring and ranking calculations are described in detail in the main report and appendices, provided as background papers. In summary, the combined findings are as follows

[Final Ranking is 1= most appropriate action, 6 = least appropriate action]

| SOCIO-ENVIRON.| ECONOMIC | STRATEGIC |

OPTION

SCORE

RANK

NPV

RANK

SCORE

RANK

RANK TOTALS

FINAL

RANK

£0

-£19,798

-£286,448

£87,178

£1,662,116

131

£602,763

121

It is evident that Option 5 - the option to clear all the existing properties in Hatherley Street and redevelop the site plus the adjoining vacant land at Rosebery Street - provides the best overall return in benefits to the whole community. In each of the three dimensions considered Option 5 is consistently the best overall fit with the objectives attached to this NRA.

Most Satisfactory Course of Action

a) NRA Outcome

On the basis of all the information collected and considered during this NRA exercise the clear conclusion is that the most satisfactory course of action is the clearance of all the existing properties, and the redevelopment of the site with new housing accommodation.

b) Adverse implications

Notwithstanding the outcome of the NRA process the City Council also needs to take into account potential adverse implications.

In order to acquire all of the privately owned properties to carry out the full-scale demolition it is virtually certain that Compulsory Purchase would be necessary. This would incur further delay to conclusion of the neighbourhood regeneration with resultant stress for residents. It would be beneficial if this could be avoided.

The inclusion of the Rosebery St land in the residential redevelopment of Hatherley St would substantially limit the expansion aspirations of the Mosque for which local Ward Members have expressed some support. While this is not directly relevant to the housing issues it is nevertheless an important consideration.

c) Proposed resolution

Several Hatherley Street residents have expressed interest in the possibility of moving across the road if new houses were built on the even numbered side. This would mean that they could stay in Hatherley Street and that the odd numbered side could then be demolished and redeveloped without compulsory relocation. Such a development could be undertaken as a mixed tenure project by Steve Biko Housing Association who have expressed interest in being involved.

This solution would require detailed discussion with residents and exploration of the potential for building new homes which met their needs and aspirations at costs which they could afford. It would also require SBHA obtaining funding from the Housing Corporation.

Officers believe it would also be possible to achieve a satisfactory design for the residential development of the odd numbered side of Hatherley Street together with the cleared site at Rosebery Street in such a way as to release land sufficient for the expansion needs of the Mosque. An integrated approach would ensure optimum community benefit could be derived from a comprehensive design and development package.

For this reason officers recommend adoption of Option 6 - clearance and redevelopment of Hatherley Street - subject to further discussions with residents over local rehousing options and that negotiations be undertaken with Liverpool Muslim Society over the use of Rosebery Street land.
Conclusions

A decision on the future of the properties in Hatherley Street is essential. The housing conditions found are unacceptable and the existing housing is not sustainable in its current condition. Residents of Hatherley Street and non-resident property owners have been affected by the current uncertainty about their future for several years.

Without a definite decision on the future of Hatherley Street conditions will continue to worsen for residents and increasingly for other residents living in adjoining properties. In addition, investment already made or planned in existing adjoining housing and in the new housing currently being built adjoining Hatherley Street will be put at risk if the properties in Hatherley Street are not dealt with properly, fully and promptly.

The proposed solution offers a way forward to enable residents to remain living in Hatherley Street while securing a sustainable future for the neighbourhood and removing the current blight.

Executive Member/Director recommendation (Councillor Marilyn Fielding / Tony Hunter) :

It is recommended that the Executive Board -

Notes the content and recommendations of the Neighbourhood Renewal Assessment report.
Approves the recommended option (Option 6) of demolishing both sides of Hatherley St and redeveloping the cleared site
Authorises officers to discuss with residents and other stakeholders the redevelopment of the even numbered side of Hatherley St for relocation of residents of the odd numbered side
Approves the costs of acquisition and demolition being met from the approved housing capital programme subject to available resources in the financial years 2008/09 to 2010/11
Authorises officers to open negotiations with Liverpool Muslim Society for the disposal of land at Rosebery Street for development in a manner which supports the residential redevelopment of Hatherley Street. If these negotiations fail to reach agreement within a period of 6 months from the date of Executive Board resolution the Rosebery Street land should be fully included within the Hatherley Street residential development.
Requires officers to submit a further report on the outcome of discussions with residents and Liverpool Muslim Society following 6 months after the date of Executive Board resolution
Requires officers to consider and appraise any alternative costed proposals received from residents or their representatives for the improvement of Hatherley Street properties and to report conclusions in conjunction with Recommendation 6.

Key Decision:

Yes

Forward Plan:

Included

Implementation effective from:

21 March 2008

Timescale for action:

3 years

Reason(s) for Recommendation:

The recommended action represents the most satisfactory course of action for the properties concerned within the context of Granby Renewal Area.

Alternative options considered:

Detailed in the report

Consultation:

Consultation with residents and other stakeholders has been undertaken over many years and formed a key part of the Neighbourhood Renewal Assessment and Option Appraisal process. Additionally, a meeting was held with residents' representatives on 20^th March 2008 to receive their views.

Consultation with Ward Councillors and outcome:

Ward Councillors have been briefed and have expressed support for the recommendations

Financial implications:

The financial implications of this option are -

2008/09 2009/10 2010/11 TOTALS

Acquisitions 116,955 189,850 200,000 506,805
(incl. Home Loss etc)

Demolitions 69,000 30,500 50,000 149,500

TOTAL 185,955 220,350 250,000 656,305
It is proposed that this cost be met from the approved Housing Capital programme subject to available resources in the financial years 2008/09 to 2010/11.

The recoverable site value of the land to be redeveloped would need to be assessed separately in relation to the outturn development costs and values.

Best Value / Risk Management:

The Option Appraisal process identifies the recommended course of action through a methodology incorporating best value assessment. Delivery of the project will be subject to detailed risk management assessment.

Equality implications / Equality Impact Assessment:

The urgent need to complete the regeneration of the Granby neighbourhood was identified as a priority within the Race Equality Impact Assessment (REIA) study reported to Executive Board in February 2007.

The race equality implications of the proposal were considered in the REIA and the final report concluded that there were no adverse effects which would discriminate against anyone on the grounds of race. The REIA recommendations were compiled into an action plan where a key requirement to complete Equality Impact Assessments (EIA) on the rest of the six equality strands was identified. The six equality strands, including race, are age, disability, religion/belief, gender and sexual orientation

The intention to design homes specifically for the needs of existing residents brings the opportunity to address particular requirements in relation to age, disability or faith. Using the EIA process will help ensure that no group experiences any adverse effects from the development proposals; EIAs will help enable the City meet the aspirations for sustainable communities where all residents are happy and safe

Corporate strategy:

The recommended action is in accordance with the approved Housing Strategy.

Budget and Policy Framework:

The recommendations contained within this report are in accordance with Housing Capital expenditure regulations and the provisions of the Renewal Area designation.

Community safety implications:

The recommended action will result in a reduction of crime and anti-social behaviour associated with vacant properties and an increase in residents' feelings of safety.

Neighbourhood Management implications:

The recommended action will contribute positively to the achievement of Neighbourhood Management objectives

Report attached:

No.

Signature: ……………………………. Signature: …………………………….

(Executive Member) (Executive Director)

Date: ................................................. Date: .................................................Appendix 1 Location Map

Appendix 2

Neighbourhood Renewal Process

The option appraisal process followed in this NRA follows the statutory requirements for undertaking a neighbourhood renewal assessment, including the specific guidance issued to local housing authorities [ie. Neighbourhood Renewal Assessment - Guidance Manual 2004].

The process provides a systematic methodology for considering possible options, determining which options are feasible and deliverable, and which represents the best approach in terms of the economic and non-economic benefits. The purpose of the option appraisal is to inform and improve the decision making process, and to assist in delivering decisions which are robust and better suited to achieving the delivery plans for Renewal Areas, and overall strategic housing objectives.

The structure provides a methodical framework for identifying which of a series of possible options represents the best approach or solution for the properties in the NRA in terms of both the economic and non-economic benefits. Option Appraisal takes no account of the individual properties or their tenure, but considers the collective information on all properties affected by the NRA.

The NRA process itself does not automatically produce an obvious end result or specific recommendation/s, instead it produces a series of valid and feasible options to consider and a consistent framework of in which to consider relevant information on those options. This is intended to assist and enable a housing authority to clearly identify and then consider the viable options for action, and after having considered that information, to then decide what [if any] actions should be taken to deal with the housing being considered in the NRA.

The NRA report is a key part of the statutory process that a local housing authority must carry out when considering the `most appropriate form of action' that it should take in respect of housing renewal decisions on older private housing.

Guidance to housing authorities on NRA's is provided in the Neighbourhood Renewal Assessment Guidance Manual 2004, and in ODPM Circular 05/2003 - Housing Renewal. This guidance must be taken into account by a housing authority when taking decisions affecting numbers of privately owned properties.
The purpose of an NRA is to provide a logical framework for the authority within which key decisions can be made on housing investment, on what type of housing investment is most appropriate taking into account the relevant circumstances, and where appropriate; the priority or order in which that investment could be made. Feasible options are identified and assessed against key decision criteria, including alternative financial, social and environmental costs, and against long-term temporal factors.
The procedure for an NRA consists of a series of logical and iterative steps, which when taken together provide a thorough and systematic appraisal technique for considering alternative course of action for an area or individual dwellings. Whatever the scale on which the NRA is undertaken, the basic steps in the process are essentially the same. The scale of the NRA will affect the approach and, to some extent, the methods used and the advice or other information obtained to enable a decision to be made which is based on valid facts.
The aim of an NRA is to produce information which will assist a local housing authority to make decisions [including statutory decisions such as declaring renewal areas or clearance areas] but is not intended or designed to specify what decision or decisions should be taken. Ultimately, any decision is at the discretion of the local housing authority after it has fully considered the information produced during the NRA.
It is important that the contents of the NRA report are considered in their entirety. Single issues examined within the report are not as relevant as the overall report, although the weight given to individual issues and their impact on the final outcomes will clearly vary.
By carrying out an NRA the City Council will be able to prove to the Government, and other stakeholders, that in arriving at its ultimate decision on the NRA it can show that it has :

ensured that the use of public funds has been preceded by a properly structured appraisal of feasible options using reliable and valid evidence,
considered the views of a range of interested individuals and organisations, and other relevant information, before arriving at its decision,
taken into account the relative costs and benefits of alternative forms of action, and targeted available resources in an effective way to deal with poor housing and environmental conditions in a Renewal Area,
established clear priorities and a definite strategy for delivering its decision after considering all the viable options for achieving its objectives in the Renewal Area.

More recently the Act was amended by the Regulatory Reform Order on Housing Renewal in July 2002. This Order amended the legislation on how local housing authorities can assist private owners in repairing and renovating their properties, and liberalised the methods which can be adopted by enabling housing authorities to decide on the best forms of assistance depending on local circumstances and priorities.

Provided that a local authority publishes a Private Sector Housing Policy, the authority can decide for itself what assistance it will make available. Liverpool City Council has published such a policy and this is available on the Councils website. This policy is relevant to this NRA in that the type and level of assistance available to individual owners in this area is dictated by that policy.

Energy efficiency and conservation measures also need to be considered both during the option appraisal in the NRA, and as part of the costs of measures considered as part of the Net Present Value [NPV] calculations for either retaining existing properties or of replacing them with new housing. In addition the Councils energy strategy lays out its policies for dealing with fuel poverty.

Recently the Government published a Green Paper [ie. Homes for the future; more affordable, more sustainable] outlining their strategic housing objectives to 2020, and hence the objectives which local housing authorities should be including in their own strategies and policies. Broadly the Green Paper sets out objectives for increasing the numbers of new affordable homes for all sections of the community, providing more social housing, building new homes more quickly by removing delivery obstacles, providing low cost home ownership solutions, and introducing much higher environmental and energy efficiency targets for all homes. The implications of these strategic changes need to be considered in this NRA as the housing solutions produced will provide housing accommodation beyond 2020, and it is essential that these are capable of providing acceptable, affordable, popular and sustainable accommodation into the future.