Issue - meetings

Further to Minute 50 (17 September 2019), the Cabinet Member for Finance, Performance and Core Services presented a joint report on the revised cost of progressing the redevelopment of 53-135 Roxwell Road and 2-4 Stebbing Way on the Thames View Estate to provide 87 new affordable homes.

The Cabinet Member explained that the impact of COVID-19 and Brexit in particular had significantly increased the cost of materials and labour in the UK, while more stringent building regulations, particularly in relation to fire safety and sustainability, had also increased costs across all new housing projects.  The original total development cost was estimated at £21.125m; however the recent tendering exercise for the demolition and construction works had identified a shortfall of £11.275m in the budget which was now estimated at £32.4m.

Cabinet Members considered the advantages and disadvantages associated with the four main options presented in the report, which covered abandoning the project; retendering the project in 6-9 months when there may be a less volatile and uncertain marketplace; disposing of the site to a third-party developer; and allocating the additional funding to progress the project as originally planned.  On the understanding that the project would proceed as planned, the Cabinet Member outlined the new funding arrangements for the project that had been endorsed by the Council’s Investment Panel.

Cabinet resolved to:

(i)  Re-affirm its commitment to the project at 53-135 Roxwell Road and 2-4 Stebbing Way, Thames View, on the terms set out in the report;

(ii)  Agree the use of an additional £5.95m Right to Buy receipts and the allocation of circa £1.5m of S106 funding, available from the first two phases of the Fresh Wharf development towards the delivery of affordable housing in the borough, to support the viability of the project;

(iii)  Agree to the inclusion of a total of £32.4m in the Capital Programme to enable the project to proceed on schedule; and

(iv)  Delegate authority to the Chief Executive, in consultation with relevant Cabinet Members and Directors and on the advice of the Investment Panel, to negotiate terms, agree final arrangements and enter into all necessary contract documents and ancillary agreements to fully implement and effect the delivery of the projects.