Housing Led Regeneration Investment in Tyne and Wear

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• Housing Led Regeneration Investment in Tyne and
  Wear
• Glyn Drury
• Director Tyne and Wear Housing Partnership
• 2008 December 2

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This presentation is an introduction to

• TWHP
• Investment picture
• Priorities
• HCA
• NeW Delivery Models
• Local Housing Companies
• Gateshead JVP

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Wear 2
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What is TWHP?

• Consortium of five strategic housing authorities
  along with Bridging NewcastleGateshead HMR
  Pathfinder working at city region level
• Working with NEA, HCA, RDA, ANEC, City Region and
  other sub regions in north east.
• Sub regional housing strategy
• Strategic Housing Market Assessment
• Allocation of 7m SHIP annually
• Advice on other sub regional and regional housing
  investment
• Sub regional choice based lettings
• Gypsies and Travellers Needs Assessment
• Board Lead Members
• Heads of Service Group
• Policy Group

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Wear 3
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Housing Investment- the Big Picture

• Source BERR Select Committee Table 1 para 9
  Construction Matters

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Wear 4
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Housing Led Regeneration - NE Govt Funding
msource Regional Funding Advice
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Wear 5
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Housing Led Regeneration - NE Govt Funding

• Excludes ERDF funding to region
• Excludes any Growth Fund and Community
  Infrastructure Fund (no regional allocations)
• Excludes a number of other direct funding
  programmes eg
• PFI Homeless Grant Housing and Planning
  Delivery Grant Housing Revenue Major Repairs
  Allowance

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Wear 6
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Housing Led Regeneration - Post 2011?

• Pre Budget Report
• At best a freeze at worst cuts in government
  spending
• Rationing by lenders

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Wear 7
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Est. Govt Investment Tyne Wear 2008/09 m
At least 70 of govt housing and regeneration
spending will be made through the Homes and
Communities Agency from 09/10 incl in Regional
Housing Pot
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Wear 8
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Place Making Priorities

• BNG Priority Areas (11 Communities)
• Lower Walker, Elswick, Scotswood, Benwell/High
  Cross, Saltwell/Bensham, Deckham
• Cleadon Park, South Shields
• Hendon, Hetton Downs, Castletown, Sunderland
• Wear corridor/Sunderland centre (Priority 1 - 5
  new communities ARC)
• Vaux, Farringdon Row, Holmeside, Sunniside,
  Stadium village/Sheepfolds
• Tyne Gateway
• Walker, Wallsend, to North Shields north bank
• Hebburn, South Shields south bank
• Growth Points

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Wear 9
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Wear 10
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Homes and Communities Agency- New Opportunities

• 1 December
• Investment functions of Housing Corporation,
  English Partnerships and teams from CLG
• Pat Ritchie Regional Director (ex One NorthEast,
  Sunderland and Newcastle)

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Wear 11
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Homes and Communities Agency- New Remit, New Way

• New organisation, new flexibility
• New culture national objectives, local
  ambitions
• New partnerships with local government, private
  sector, RSLs, and regionally
• New business process (single conversation)
• New business products
• New relationship with Government the voice of
  delivery
• Investment agreements

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Wear 12
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Homes and Communities Agency
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Wear 13
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Homes and Communities Agency- Benefits

• An approach focused on the needs of communities
  and people
• An approach based on programmes of activity
  rather than funding projects
• An integrated approach using funding flexibly,
  in a way that meets the needs of that area
• A responsive, adaptable approach able to innovate
  to come up with new solutions for changing
  circumstances

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Wear 14
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New Delivery Vehicles - Potential

• Local Housing Companies, Gateshead Joint Venture
  Partnership
• 4 companies geographically based
• Over 70 sites
• Over 10,000 new homes

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Wear 15
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Local Housing Companies - Background

• 2007 Housing Green Paper
• One of a series of initiatives
• 14 national pilots including Newcastle and
  Sunderland in the north east
• master developer for new communities
• Focus on delivery

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Wear 16
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Joint Venture Models - Key Objectives (1)

• Increase the supply (net additional) of a range
  of homes, including affordable homes
• Maximise use of Local Authority land asets
• Position the Local Authority at a stronger point
  in the centre of the development process
• Sharing risk and reward
• Capture a share of any increase in land value
  over time
• Increase pace and predictability of development

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Wear 17
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Local Housing Companies - Key Objectives (2)

• Complement existing regeneration initiatives and
  achieve added value
• Create quality, sustainable schemes which provide
  wider customer choice and tenure options,
  particularly the intermediate market
• Provide opportunities for a range of investment
  and development players to become partners of the
  Local Authority

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Wear 18
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Joint Venture Models - Key Players

• Local Authority provides the land
• English Partnerships (HCA) provides the
  technical support and expertise (and some
  funding)
• Contractor(s)
• Funder(s)
• Form Joint Venture Company

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Wear 19
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Joint Venture Models - whats different

• Move from gap funding to investment
• Sharing risk and reward
• More LA leadership and control
• Less reliance on planning obligations
• Long term interest by all partners

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Wear 20
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Scotswood Urban Regeneration Vehicle

• Newcastles first LHC
• 2,200 new properties planned
• Predominantly family housing and associated
  community infrastructure
• Legacy of housing market failure in West End
• Transformational Change
• Expo
• Significant public sector support funding

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Wear 21
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Scotswood Urban Regeneration Vehicle - Structure

• Joint Venture Company with 50 of shares held by
  the public sector (Newcastle City Council
  English Partnerships/HCA)
• Financial support from Bridging
  NewcastleGateshead and Housing Corporation/HCA
• Not just housing investing in schools,
  enterprise, public realm, green infrastructure
  and community facilities.

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Wear 22
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Scotswood Urban Regeneration Vehicle Current
Position

• Selection of development partner at competitive
  dialogue stage
• Key element of Growth Point Programme of
  Development
• Financial closure planned Summer 2009
• Programme to commence late 2009

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Wear 23
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Newcastle City Wide LHC Current Position

• Thirty Council owned sites identified in
  development pipeline
• Capacity 2,500 units
• Options appraisal underway
• Adaptation of financial models sensitivity
  analysis
• Review of intermediate tenure models
• April 2009 report to Executive

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Wear 24
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Sunderland LHC Current Position

• 21 Council owned sites have been identified
• 1 English Partnership site to be included in the
  LHC portfolio
• Sites have been valued
• Capacity for around 2,500 new homes
• Financial Appraisals to be carried out on all
  sites
• Steering Group set up to manage the process,
  inclusive of English Partnerships/HCA

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Wear 25
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Gateshead Joint Venture Partnership

• 19 sites others added or removed as assessments
  progress
• Potential 3,000 homes
• Gross development value estimated at 1bn

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Wear 26
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Gateshead Joint Venture Partnership- Progress

• Limited Liability Partnership
• Cabinet approval June 2008
• Project team established
• Competitive dialogue started 21 November with
  invitations of interest
• Operational September 2010
• BNG contribution to project costs
• HC/HCA commitment to invest
• ALMO interest as a development partner

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Wear 27
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Joint Venture Models Opportunities

• New intermediate housing products
• Widen choice and meet aspirations
• Create mixed and balanced communites
• - more affordable homes where needed
• - providing for specialist needs, elders,
  disability, support
• Broader integration of housing supply and demand
• Raise quality of housing
• Meet growth targets
• Ongoing neighbourhood management role

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Wear 28
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Joint Venture Models Challenges

• Housing market difficulties from credit crunch
  to recession.
• Commitment to mixed communities
• Confidence
• Getting the right development partner
• Quality of sites
• Development management
• Risk
• Complementing not competing
• Significant but not sole initiatives

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Wear 29
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• Thank you for listening
• Any questions?
• glyn.drury_at_northtyneside.gov.uk
• 0191 643 2180