Friday, October 21, 2016

News: Wates awarded Rotherham housing contract

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Wates Construction has been awarded a key contract to deliver a potential 200 new houses on a cluster of sites owned by Rotherham Council.

The authority has signed off its Housing Strategy which launched over the summer. It sets out how the Council is responding to the various housing challenges and what it intends to do and comes after changes to Government funding left councils with a reduced capacity to deliver housing growth.

It is acknowledged that the Council is having to work differently and embrace working with the private sector much more in order to find ways to deliver the objectives.

One key project is an innovative development model from the Council to bring forward some of its "more challenging" sites. Wates successfully secured a multi million pound tender and will act as the Council's development partner to proceed with the seven sites in Maltby, Canklow, East Herringthorpe and Dinnington.

The Wates Group is one of the largest privately-owned construction, development and property services companies in the UK and has previously worked on projects to provide social and affordable housing in Canklow under its Wates Living Space brand.

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The Council is proposing to build 97 homes for outright sale and a further 88 specialist and affordable homes, the timetable is to obtain planning approval by mid May 2017 and achieve a start on site in the summer of 2017.

The proposal from Wates offered to deliver 185 new homes across the seven sites, which will remain in Council ownership. A report to the council's cabinet and commissoners, stated: "Whilst this is the lowest number of housing units offered overall, there is scope to increase the housing numbers on several sites with design variations."

Under the model, Wates will take the role of a developer agent for the Council with the authority funding the development activities. Houses sold will lead to sales revenue (a prospective £3.8m) provided directly to Rotherham Council (excluding a developer's margin) to cross subside the development. The Council will also receive the majority share of any developer's profit on the schemes, through retaining the development value of the land.

Local authorities can borrow funding on much better terms than housing developers and the Council will bank roll the project for around 18 months until sales revenues are generated.

The Council is also required to underwrite the pre-development and planning stage costs, in the event of the project not proceeding. These are currently estimated at £335,000.

As part of its housing strategy, Rotherham has submitted a bid to the Government's new £1.2 billion Starter Homes Land Fund to help prepare key sites in the town centre for residential development. The Council has also acquired more than 90 new homes for council rent in areas of high demand, acquired properties in Maltby which have stood empty for some time and are in need of investment, and sold a number of its sites to private developers.

Wates website

Images: RMBC


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