134, 139, 140, 141 Bromsgrove Street, Unity House & The Armouries, Birmingham

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1 Committee Date: 18/09/2014 Application Number: 2014/05497/PA Accepted: 17/06/2014 Application Type: Section 106B Application Target Date: 15/07/2014 Ward: Nechells 134, 139, 140, 141 Bromsgrove Street, Unity House & The Armouries, Birmingham Section 106BA application to remove the affordable housing obligations secured under planning application 2010/02473/PA for the erection of 2 buildings and retention of Unity House to provide 162 apartments, 395sqm of ground floor commercial floorspace (A1, A2, A3, A4, B1, D2) and 98 car parking spaces. Applicant: Agent: Recommendation Refuse Lend Lease c/o agent PJ Planning Ltd 5 St Pauls Terrace, 82 Northwood Street, Birmingham, B3 1TH 1. Proposal 1.1. This application is a S106BA which seeks the removal, in its entirety, of the affordable housing provision of 9 one and two bed apartments (5.5%) secured in connection with planning permission 2010/02473/PA for the redevelopment of Unity House for 162 apartments. 2. Site & Surroundings 2.1. The area around the application site is mixed and comprises a mix of commercial, leisure and residential apartments as well as a number of temporary/surface car parks and secondary vacant industrial buildings. The site is located within the Birmingham City Centre and close to New Street Station and Digbeth Coach Station and also in close proximity to the Bull Ring Development Part of the application site includes Unity House which is locally listed Grade B Demolition and underground works have commenced. 3. Planning History th November /03254/06/PA Erection of 2 buildings and retention of Unity House to provide 162 apartments, 395 sq m of ground floor commercial floorspace (A1, A2, A3, A4, B2, D2) and 98 car parking spaces. Approved at appeal. Page 1 of 5

2 th April /02473/PA Extension of time limit on previously approved 2006/03254/PA for erection of 2 buildings and retention of Unity House to provide 162 apartments, 395 sq m of ground floor commercial floorspace (A1, A2, A3, A4, B1 and D2) and 98 car parking spaces. Approved subject to S th August /03202/PA Variation of condition 1, 3, 5, 8, 9, 10, 12, 14, 15 and 16 following planning permission 2010/02473/PA. Approved th May /02512/PA Application to determine details of conditions 2 (drainage) and 11 (ground contamination) attached to planning approval 2013/03202/PA. Approved. 4. Consultation/PP Responses 4.1 None required. 5. Policy Context 5.1. Town and Country Planning Act 1990, The Growth and Infrastructure Act Planning Considerations 6.1. In an attempt to kick start stalled housing sites the Government amended the S106 part of the Town and Country Planning Act 1990, by the Growth and Infrastructure Bill 2012, to allow new sections 106BA, 106BB and 106BC to be introduced. The new S106BA permits a formal application to be submitted to the Local Planning Authority to modify or discharge the affordable housing requirement of an obligation associated with a particular planning permission where the developer considers the affordable housing requirements render the scheme unviable. Unlike S106A there is no time restriction on the date upon which an application under S106BA can be made, however there is a sunset clause within The Growth and Infrastructure Act itself that means that S106BA, BB and BC will cease to have effect after 30th April There is a right of appeal against any refusal. The remainder of the consent stays intact Government advice is that the test for viability is that the current cost of building out the entire site (at today s prices) is at a level that would enable the developer to sell all the market units on the site (in today s market) and make a competitive return to a willing developer and a willing landowner. Therefore, if evidence is submitted to demonstrate the agreed affordable housing obligation makes the scheme unviable the local planning authority should agree to amend or remove the obligation as kick starting the development is fundamental This application is therefore made under S106BA and the applicant seeks to discharge the affordable housing obligation in full Planning permission was granted in 2011 following permission in 2006 for the redevelopment of the site with 2 buildings to provide a total of 162 apartments. The S106 Agreement required 5 one bed and 4 two bed units to be provided for either shared ownership or intermediate rent, at a cost of approx. 500,000 to the developer The applicant has submitted a financial appraisal to demonstrate that their expected site development costs along with their expected revenue would result in a loss of Page 2 of 5

3 approx.. - 6%. This would improve slightly if the affordable housing provision was not required to a loss of approx. -4% A normal developer profit is generally considered to be around 15-20% The Council has commissioned an independent financial appraisal of the information submitted in support of this application. This assessment has included analysis of the developers cost and revenue assumptions, as well as a further three development appraisals, noting that even when all costs of the site acquisition are removed a profit of only 7.8% could be expected. It therefore concludes that there is insufficient viability within the scheme to support the Section 106 affordable housing requirement Therefore the scheme, even without the affordable housing contribution, would not provide a normal developer return, however by removing the affordable housing requirement it would assist in the overall developer return. Further the applicant has confirmed that without the affordable housing contribution they would be prepared to complete the development in order to bring forward the development, recover as much of their investment as possible and in doing so re-enter the Birmingham residential development market to re-establish their product and assist the City s desire to regenerate this area However, legislation clearly identifies that if the development is not economically viable then..the authority must determine that the affordable housing requirement is to continue to have effect without modification or replacement. Consequently the application should be refused. 7. Conclusion 7.1 The scheme would not be viable even if the affordable housing contribution was to be removed and therefore whilst the redevelopment of the site is welcomed the legislation requires that the application is refused. 8. Recommendation 8.1 Refuse. Reason for Refusal 1 The removal of the affordable housing requirement attached to planning permission 2010/02473/PA would not make the scheme financially viable and in accordance with Section 7 3(b) of the Growth and Infrastructure Act 2013 the request to remove the obligation is refused. Case Officer: Joanne Todd Page 3 of 5

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5 Location Plan This map is reproduced from the Ordnance Survey Material with the permission of Ordnance Survey on behalf of the Controller of Her Majesty's Stationery Office Crown Copyright. Unauthorised reproduction infringes Crown Copyright and may lead to prosecution or civil proceedings. Birmingham City Council. Licence No , 2010 Page 5 of 5

Committee Date: 17/07/2014 Application Number: 2014/02259/PA Accepted: 28/04/2014 Application Type: Full Planning Target Date: 23/06/2014

Committee Date: 17/07/2014 Application Number: 2014/02259/PA Accepted: 28/04/2014 Application Type: Full Planning Target Date: 23/06/2014 Ward: Selly Oak 101 Hubert Road, Selly Oak, Birmingham, B29 6ET