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Waverley Borough Council Committee System - Committee Document

Meeting of the Executive held on 17/05/2005
PROPERTIES IN HASLEMERE -
REDEVELOPMENT OF THE KILNFIELDS ESTATE



Summary & Purpose
The purpose of this report is to update Members on the progress of the construction project at Kilnfields, and to set out the current expenditure and expected financial outcome of the scheme.

Quality of Life Implications
Natural Resource Use
Pollution Prevention and Control
Biodiversity and Nature
Local Environment
Social Inclusion
Safe Communities
Local Economy
Natural
Resource Use
Pollution
Prevention and Control
Biodiversity
and Nature
Local
Environment
Social
Inclusion
Safe, Healthy
and Active
Communities
Local
Economy
Positive
Positive
Positive
Positive
Positive
Positive
Positive


APPENDIX B

WAVERLEY BOROUGH COUNCIL

EXECUTIVE - 17TH MAY 2005

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Title:
PROPERTIES IN HASLEMERE -
REDEVELOPMENT OF THE KILNFIELDS ESTATE

[Wards Affected: All Haslemere Wards]
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Note pursuant to Section 100B(5) of the Local Government Act 1972

The annexes to this report contain exempt information by virtue of which the public is likely to be excluded during the item to which the report relates, as specified in those paragraphs of Part I of Schedule 12A to the Local Government Act 1972, indicated;

The amount of any expenditure proposed to be incurred by the authority under any particular contract for the acquisition of property or the supply of goods or services (paragraph 8).

Any terms proposed or to be proposed by or to the authority in the course of negotiations for a contract for the acquisition or disposal of property or the supply of goods or services (paragraph 9).
________________________________________________________________________
Summary and Purpose

The purpose of this report is to update Members on the progress of the construction project at Kilnfields, and to set out the current expenditure and expected financial outcome of the scheme.

_________________________________________________________________________
Quality of life implications – social, environmental & economic (sustainable development):

Natural Resource Use
Pollution Prevention and Control
Biodiversity and Nature
Local Environment
Social Inclusion
Safe, Healthy and Active Communities
Local Economy
Positive
Positive
Positive
Positive
Positive
Positive
Positive

The regeneration of this estate will result in an improvement to the quality of life of residents.

E-Government implications:

There are no E-government implications from this report

Resource and legal implications:

These are spelt out in the (Exempt) Annexes to this report.
_________________________________________________________________________
Introduction

1. The estate of Kilnfields in Haslemere, which was originally built in the 1920’s, has been redeveloped during the past 2 years. The original 44 houses were considered uneconomical to maintain and refurbish to modern standards and in 2001 the Council made a decision to rebuild.

2. The new estate will now comprise 36 houses for rent, 21 for shared ownership, 8 owner-occupiers, and 20 units for open market sale.

Partnership

3. The builder, Lovell, was appointed on a partnership basis subsequent to a successful interview before full Council, and started work in January 2003. The work was to be carried out in three phases, Phases 1 and 2 comprising all the rented properties, all the owner-occupiers and 90% of the shared ownership units. Phase 3 was to include the units for open market sale and the remainder of the shared ownership units.

4. The architects are PRP Associates and the principal advisor and site agent for the project is the Airey Miller Partnership.

5. The partnership also includes Thames Valley Housing Association who have a separate contract with Lovell to build the 21 units for shared ownership.

6. The final rented units are due for completion in June 2005 whilst the build contract between Lovell and Waverley Borough Council is now reaching its conclusion. Phase 3, which Lovell will build for sale, will include the main entry roads and the remainder of the infrastructure to the estate.

Design principles

7. The principle behind the redevelopment was to provide a mixed tenure community on a pedestrian friendly estate with properties which achieved a very good Eco-Homes rating.

8. The opportunity has been taken to include in the project a refurbished recreation and play area with a new community pavilion adjacent to the new estate.

9. The generic name of Kilnfields has now been replaced with individual roads names, Kiln Avenue and Playing Field Close.

10. The challenge was to rebuild the estate around the existing residents thus enabling each occupant a single move from their old home to their new home. Thus, the prior planning of phasing was critical to the success of the project. Whilst one household elected to move twice, in all other cases this objective has been achieved.

Income

11. The financial assembly of the project included the sale of five parcels of land for private and shared ownership sale through Lovell and Thames Valley Housing Association. This contribution was significant to the affordability of the project, and enabled the comprehensive scale of the development to be achieved.


Eco Homes

12. The Government has introduced a scheme of labelling properties according to energy efficiency. This initiative known as Eco homes rates new buildings as Pass, Good, Very Good, or Excellent. Building Regulation standards would achieve generally a Good rating. Every new home on the new estate is designed to achieve an Eco homes rating of Very Good. However, as part of Waverley’s commitment to sustainability initiatives it was agreed by the Executive (12/7/04) that two of the new rented properties would be redesigned and re-costed to Excellent standards, and that an exhibition be mounted there to publicize sustainable techniques. This work is under way and the opening date is expected to be at the beginning of June 2005.

Progress.

13. Phase 1 which comprised the first 20 units was completed in February 2003. Phase 2 commenced in February 2003. However, two significant occurrences have delayed the progress of this phase. 14. Negotiations have been on-going with all the 9 existing owner-occupiers during the project, to enable them to move to a new property on the estate, which retains the value that had accrued in their old property. However, agreement could not be reached with one individual until December 2004 as to a satisfactory valuation for his property. Eventually, Lovell was able to buy the property on Waverley’s behalf and the owner-occupier moved away and resettled elsewhere. The cost of this buy back is reflected in the 2005/06 figures at (Exempt) Annexe 2. These protracted negotiations meant that the original house could not be demolished and the smooth flow of building works was disrupted. The consequence is that Waverley Borough Council now has an additional new property that could be disposed of to recoup the cost of the buy-out. An independent valuation has been sought (see (Exempt) Annexe 3). Alternatively, the Council could retain the property for rented housing or dispose of the property on a shared ownership basis (see (Exempt) Annexe 3).

15. The Council’s vision for Kilnfields was to achieve a mixed tenure, sustainable development providing rented, shared ownership and homes for owner occupation. On the basis of the now agreed planning consents, one additional shared ownership and four additional outright sales have been achieved. It is, therefore, considered that the Council could take this additional home into rented stock to maintain the overall mix. (Exempt) Annexe 2 details the financial implication of this proposal. 16. Prior to work commencing, submissions are made to the utility companies, and all known electricity cabling, water and gas pipe work is plotted on the service plans. These submissions did not reveal the existence across the site of gas and electric services serving existing properties in adjacent Weycombe Road. The new properties, which were to be built in the area affected by the pipe work, were delayed by six months whilst the utility companies carried out the necessary procedures to allow diversion to take place. These combined factors have delayed the completion of Phase 2 by five months.

Financial Implications

17. The financial structure for the development of Kilnfields was based on the cost of the construction set against the income that was forthcoming from the development of Waverley land. The difference between the two represents the value that has been extracted from the project as a whole.

18. (Exempt) Annexe 1 sets out the estimated costs and income at the commencement of the project in November 2002 and (Exempt) Annexe 2 shows the latest position statement showing actual cost/income to date and the estimate to completion. Although Waverley’s contract for build is nearing completion, Lovell will remain on site until Spring 2006 to complete the units for sale, the infrastructure and the landscaping. Part of the cost of these elements has been borne by Waverley in its contract and therefore interest in the partnership will continue until the whole project is complete.

19. The costs estimated at (Exempt) Annexe 2 for 2005/06 include penalties that would be incurred if Lovell has to delay the start of the new build. Discussions are ongoing to allow Lovell to enter the site on licence to start their new build but this is dependent on a price being agreed for the site. Waverley has sought an independent valuation of the potential selling price of the houses to be built for open market sale and this forms the basis of the calculation of the land receipt (Exempt) Annexe 2).

20. In addition to the extra costs incurred with the utility companies, outlined at 13 and 14 above, there have been other factors giving rise to cost increases. These include the County Council requesting an extra thickness of tarmac, preliminaries and infrastructure apportionments. As part of the partnering contract, negotiations between Lovell, Thames Valley and Waverley need to reach a fair settlement of these costs. Currently, however, (Exempt) Annexe 2 reflects the worst-case scenario.

21. Contract discussions are sufficiently advanced, however, to enable Waverley’s project advisor to conclude that the estimated figures are likely to be the maximum costs and negotiations will continue to seek reductions.

Conclusion

22. Subject to the completion of Phase 3,the original objectives to rebuild the Kilnfields estate as a mixed tenure model and upgrade the adjacent recreational facilities has been achieved. Subsequent requirements to achieve Excellent Eco homes standard on two properties are in hand. Some work remains to be concluded to infrastructure and landscaping.

23. The completion date of Waverley’s rented properties will be achieved in June 2005 and it is recommended that the additional home is taken into the Housing Revenue Account rented stock.

Recommendation

It is recommended that:-

1. the Progress Report be noted;

2. the Council takes a view on the treatment of the additional home available in Phase 2; and

3. the revised scheme costs, as shown in (Exempt) Annexe 2, be noted.
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Background Papers (DoH)

There are no background papers (as defined by Section 100D(5) of the Local Government Act 1972) relating to this report.
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CONTACT OFFICER:

Name: David Simmons Telephone: 01483 523374

E-mail: dsimmons@waverley.gov.uk



COMMS/EXECUTIVE/2005-06/006
43530