(CITY/AREA/WARD) REF This Report and the Appendices are exempt from publication on grounds of paragraph 7 and 9 of Schedule 12A of the Local Government Act 1972.
STATUS - EXEMPT
Portfolio: Regeneration |
Executive Member/Director: Councillor F Clucas Charlie Parker |
Date of submission: |
Subject: Regeneration of the Granby Triangle. L8 |
Report No./Background papers Granby Toxteth Masterplan Expressions of Interest Received Appendix 1 |
Contact officer: David Seddon x225 6300 |
Executive summary
The Executive Board, at its meeting on 9th July 2004, noted the Granby Toxteth Masterplan as a concept document which outlined a vision for the area.
The Board also agreed that a further report should be brought forward which specifically addressed the regeneration issue of the Granby Triangle. This report describes the action taken to address those issues and it recommends that the LCC and its lead developer appoint Company C as their preferred sub-developer in order to tailor that company's approach to the regeneration of the Granby Triangle.
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Executive Member Cllr F Clucas and Charlie Parker
Recommendations
The Executive Board authorises:
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1.0 Background
1.1 In February 2004, the Council appointed 4 lead developers to work in partnership with the Council and the RSL's to deliver the Housing Market Renewal Initiative across the inner core of the city. The Granby Triangle (defined as Ducie, Jermyn, Cairns, Beaconsfield and Granby Streets) is situated within the City Centre South Zone of Opportunity and the lead developer for this area is Gleeson.
1.2 In view of its recent history the Granby Triangle was identified by officers as a preferred early start on site for the lead developer, and was highlighted as such along with various other sites across the zone. However the lead developer considered that other sites were more deliverable in the short term and instead, preferred to work with the Granby community over the next few years in order to work up proposals for the area. Opinion as to the future of the Granby Triangle and a subsequent way forward was divided. It was obvious from community meetings that there were differences within the community as to whether partial demolition was acceptable yet it was pushing for an early solution to the worsening situation in South Granby.
1.3 It was apparent that the Council would need a private sector partner who understood the historic, architectural and cultural importance of the Granby Triangle, if a suitable regeneration solution was to be implemented.
1.4 Any solution would have to preserve as much of the streetscene as economically possible whilst providing a variety of house types sufficient to satisfy the existing residents and attract new families to the area.
1.5 A Development Brief was therefore produced and sent out to seven developers who had experience of the regeneration of inner city areas. Their expression of interest in the project was invited. In alphabetical order these developers were:
1.6 It should be noted that this invitation was primarily an opportunity to assess interest in undertaking what was a difficult brief and the financial consequences of implementing differing approaches as soon as possible. 2.0 Context of the Development Brief. Aims and Design Principles. 2.1 The Brief explained that the Council was looking for an innovative solution to the problems of the area which would provide properties suitable for all types of tenure and household sizes, and particularly address the needs of the existing residents. 2.2 It accepted that some demolitions might be inevitable but encouraged the retention and refurbishment of buildings wherever economically viable, in accordance with the wishes of the community and members. 2.3 The importance of the Granby Triangle to the vision embodied within the Granby Toxteth Masterplan was explained and how the aims of the following policies had to be addressed:
2.4 The Brief also made it clear that any submission should be cognitive of the Council's Urban design Guide with specific attention to:
Financial Appraisal. 2.5 In order to assess the financial viability of each approach a full development appraisal was required as part of the submission accompanied by notes on any assumptions used and supported by comparable evidence wherever possible. In particular, the following points should be made clear:
2.6 A draft of the Development Brief was presented to and agreed with the Executive Member for Housing and Social Care and the Chief Executive. 3.0 How the Submissions were Analysed. 3.1 As a result of the Development Brief, three expressions of interest were received from Gleeson, Lovell's and Urban Splash. They were opened together and recorded by a Legal Representative in accordance with Council procedure. The expressions of interest were then analysed in accordance with the following criteria which were based on those developed for the selection of the lead developers for the HMRI zones: Planning/Urban Design. 3.2 The methodology consisted of assessing each submission against a set of questions. The submissions were given scores out of ten for their answer. The scores were totalled to give an overall rating. Two officers undertook this exercise independently and the scores were added and averaged. It revealed that Company C had submitted plans and ideas which most closely matched the Brief. Financial Appraisal 3.3 Almost inevitably, given the complexity of the Brief and the number of possible solutions, each developer made varying assumptions which affected the gap funding required. However, all three submissions assumed that existing Council owned property would be transferred to the developer at nil cost. 3.4 Where the council did not own property, there were differing assumptions as to how their acquisition would be funded.
3.5 Other items such as security and demolition costs were omitted altogether. 3.6 Therefore in order to judge the financial submissions on an even keel, adjustments have had to be made based on the unit cost assumptions used in the HMRI Pathfinder Prospectus. The results of this adjustment are contained in Appendix 1. It is interesting to note how the relative costings vary when one compares the gap funding required in the funding appraisals to the fully adjusted figures showing the total public subsidy. 4.0 Resume of the Submissions in Descending Order of public Subsidy. Company A (total public subsidy £16.2M, gap funding £10.26M)
4.1 They more or less propose to retain all properties in the area and refurbish them by removing the rear elevations and outriggers and installing glass walls. All rear yards will be removed and a `habitable hedge' proposed for rear access. It is a comprehensive copy of proposals elsewhere in the North West and does not tailor the solution to the Granby neighbourhood. They propose a significant number of apartments. They prefer vacant possession, but have made an allowance for external improvement grants for owner occupiers. They have not undertaken any structural investigations to ascertain whether or not their proposals are feasible therefore it is anticipated that costs will rise or the proposals will change significantly.
4.2 They propose that 10% of the units should be offered to CDS (the lead RSL for City Centre South) at a 15% discount to be used for shared ownership. Although the concept is interesting, the 15% discount means the gap funding requirement has increased and CDS would need to identify funds to match the gap between what the residents could afford to pay and the ultimate sales price.
Company B (total public subsidy of £10.9M, gap funding £2.8M)
4.3 They propose substantial demolition, retaining only 59 properties in the area. They propose a mix of house types (including a significant number of semi - detached houses) totalling 106 new build homes and 47 new build apartments. This does not conform to the brief. They require vacant possession and have made no allowance for this. They have not included any demolition costs in their appraisal. One community facility is proposed.
4.4 The company propose to employ a Community Liaison Officer recruited from the local community to act as an arbitrator between the company and the community when problems occur during construction. This is an idea they have successfully used elsewhere and is worth pursuing whichever expression of interest is followed up.
Company C (total public subsidy £7.9M gap funding £3.5M)
4.5 They also propose substantial demolition but significantly will retain the facades of properties in key areas. 42 properties will be totally refurbished for family houses and 57 new houses will be constructed behind retained facades. In addition 37 apartments will be created out of refurbished houses. They propose 8 retail/commercial units and 4 community facilities as part of a community hub for the area. Allowances have been made for site assembly and options suggested to assist the existing owner occupiers. Rear yards and high walls will be removed. Although they have made some allowance for the cost of acquiring properties in private ownership, they would prefer the Council to negotiate.
4.6 Appendix 1 illustrates the development type and tenure proposed by each developer.
5.0 Summary. 5.1 Two of the companies require vacant possession of all properties. One does not require vacant possession of the owner occupied properties but remains silent on how their improvement will be achieved or refunded and fit in with their radical proposals. 5.2 Over the last 18 months English Partnerships have funded the Council's purchase of vacant properties in this area at a cost of £1,020,750 (an average of £9 000 per property). The remaining properties will cost far more because they are generally in better condition and there has been a substantial rise in open market value in many areas across Liverpool. 5.3 Company C's submission fulfils many of the Development Brief's design requirements whilst requiring least public subsidy. 5.4 In anticipation of any submissions requirement for public subsidy, there have been discussions with EP concerning the possibility of them making more finance available. There is little chance that such finance will be available until the 2005/06 financial year.
5.5 Very few HMRI resources have been committed to the Granby Triangle in 2004/05 and 2005/06 because of the requirement to actually spend and not just commit finance, and the need for quick intervention in other areas. It would therefore seem prudent to explore the approach suggested by Company C in detailed discussions with that company, E.P., the lead developer and the lead RSL at the same time that consultations are proceeding with the local community.
5.6 It is to be expected that there will be alterations to the Company C's scheme following consultations and the financial implications are likely to change accordingly. EPs involvement in this iterative process would be an advantage in persuading them to provide additional funding, which is considered necessary if any scheme is to be progressed as quickly as the community would like. 5.8 Therefore in order to ensure that this development is
5.9 It is recommended that the Partnership of lead developer and LCC appoint Company C as preferred sub-developer subject to the results of the discussion outlined above.
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Key Decision? YES
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Forward Plan/3 days notice/special urgency
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Implementation effective from: Immediate
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Timescale for action: Immediate
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Reason for Recommendation The recommendations are required to progress the successful regeneration of the Granby Triangle area.
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Alternative options considered The report discusses three alternative options for regeneration. The fourth option of doing nothing is not acceptable. |
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Consultation This will continue through the Neighbourhood Manager for South Central and the appointed lead RSL and Developer. |
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Financial implications: This report does not commit the authority to any financial obligations at this stage. Ongoing consultation with residents, area representatives and funding bodies will lead to a full financial appraisal being worked up. This appraisal will be reported to members in detail. This report may or may not identify a financial contribution on the part of the City Council. However no financial commitment will be made until all relevant issues have been analysed and member approval given.
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Best Value: The expressions of interest were not intended to reflect actual financial appraisals but produce ideas and proposals to enable the Council to consider how best to approach the Granby Triangle opportunity. The process did in fact provide three submissions and it is considered that Company C's proposals provide the best value both in design terms and financially. The actual details of the project will be reported further in accordance with recommendation 5 of this report if approved. |
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Equality implications: The regeneration of the Granby Triangle will assist in achieving the aims outlined in the Community Plan.
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Corporate strategy: The regeneration of the Granby Triangle will assist in the delivery of the Council's Private Sector Renewal Strategy and meet the ODPM's Sustainable Communities Strategy. |
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Budget and Policy Framework
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Community safety implications: The overall condition of the housing and neighbourhood within L8 will be drastically improved. |
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Signature: ……………………………. Signature: …………………………….
(Executive Member) (Executive Director)
Date: ................................................. Date: .................................................
Appendix 1:GRANBY DEVELOPER APPRAISALS |
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Company A
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Company B
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Company C
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Gap funding required |
10,264,789 |
2,815,677 |
3,500,000 |
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EP spend to date |
1,020,750 |
1,020,750 |
1,020,750 |
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Estimated cost of purchasing remaining stock (119 units) |
5,730,000 |
5,730,000 |
5,730,000 |
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Estimated cost of securing remaining stock @ £1250 per unit |
148,750 |
148,750 |
148,750 |
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Estimated cost of demolition @ £3000 per unit |
0 |
570,000 |
325,000 |
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Estimated cost of homeloss/distrurbance @ £17 000 per unit say 40 owner occs |
680,000 |
680,000 |
680,000 |
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SUBTOTAL A |
17,844,289 |
10,965,177 |
11,404,500 |
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assumed acquisition costs detailed by developer |
400,000 |
0 |
3,150,000 |
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assumed cost for enveloping scheme |
1,188,000 |
0 |
0 |
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assumed cost of demolition by developer |
0 |
0 |
275,000 |
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SUBTOTAL B |
1,588,000 |
0 |
3,425,000 |
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TOTAL ESTIMATED PUBLIC SUBSIDY (A - B) |
16,256,289 |
10,965,177 |
7,979,500 |
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Estimated average unit cost based on around existing 250 units |
65,025 |
44,800 |
31,918 |
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PROPOSED DEVELOPMENT TYPE/TENURE |
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No. houses refurbished as a single dwelling |
178 |
59 |
42 |
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No.façade retained houses |
0 |
0 |
58 |
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No.Apartments resulting from refurbished houses |
104 |
0 |
37 |
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No.new build houses |
0 |
106 |
57 |
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No.new build apartments |
40 |
47 |
74 |
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No. new commercial units |
8 |
0 |
8 |
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No. community spaces |
0 |
1 |
4 |
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