Agenda item

To consider the Brick by Brick business plan.

The Managing Director of Brick by Brick presented the draft annual business plan to the Sub-Committee and stated that the content of the document was changing rapidly, with some of the information now out of date since it was published. New information would be updated prior to the presentation of the draft at Cabinet.

The Sub-Committee was informed that the report contained detailed analysis, aims and structure of projected costs beyond a single year. It also included market analysis following Brexit of construction pricing and tendered schemes.

The paper further detailed the revenue that was expected to be accrued, how much would be spent, expected levels of borrowing and the delivery of programmes.

Members queried the risks to the development and delivery programme such as rises in interest rates, fluidity of the housing market and what contingencies were in place to manage the associated risks.

Officers responded that there was a detailed analysis in place due to a property correction expected in the London housing market where it is predicted there would be reduced growth following a period of strong growth in outer London.

Officers acknowledged the element of associated risk with all markets but expected that there would be limited effect on the ability to sell the developments proposed for Croydon. The developments were geared towards first time buyers, with demand still high in this group due to the different schemes available to assist them in purchasing their first property.

There was also an advantage of being a distinct Council development company as there was the scope to release properties into the market that had an associated commercial element.

In response to Member’s questions as to what lessons had been learnt in the last year, the officer advised that  there would be future extensive work undertaken in the following areas:

•Product design

•Robust delivery of schemes as a result of ambitious delivery programme

•More engagement with local residents

•Collaboration with other Local Authorities and across the UK in terms on learning.

Members queried the level of consultation and communication with local residents. Officers informed the Sub-Committee that there was a new Head of Communications in post who had reviewed  the process in place to ensure information was being relayed to local residents and that they were kept aware and up to date with proceedings.

The Sub-Committee was further informed that with regards to all units, there would be a period of exclusivity for local residents to express and reserve units of interest. Members welcomed this proposal and suggested that residents living in proximity to units be given priority to those units.

The Sub-Committee questioned the quality of the materials to be used for the units and asked for assurances that robust, high quality materials would be used for all the proposed units. Members were advised that whilst different materials would be used for different tenures, architects designing schemes had been instructed to ensure that all units had commonality of high specification materials which had gone through a robust consultation process.

Additionally, it would be made clear to companies who submitted tenders that works carried out must be in line with the high specifications set.

In response to Members’ questions on how they expected to achieve a balance between a duty to shareholders and a commitment to produce high quality units, officers advised that investment had been made on good design which would result in high quality developments.

Officers responded to queries on how it was decided as to which units would be retained by Brick by Brick and stated that the private rented units would be retained by Brick by Brick  whilst the council would retain the affordable units.

The Sub-Committee

RESOLVED to recommend to Cabinet that Residents living in close proximity to a site should have priority access to affordable units either to rent or shared ownership.