Key information
Decision type: Director
Directorate: Planning
Reference code: DD150
Date signed:
Decision by: Emma Williamson, Director of Planning
Executive summary
The appointment of external consultants is required to provide expert assistance to Old Oak and Park Royal Development Corporation (OPDC) in the assessment of affordable housing viability matters relating to the proposed development at 1 Portal Way, North Acton, W3 6RS.
OPDC requires additional expertise for this exercise to enable a full and proper assessment of the affordable housing viability information submitted with the planning application for 1 Portal Way.
The value of the contract is expected to be up to a maximum of £15,000. An undertaking will be secured with the planning applicant to meet the cost, and reimbursement will be required before the application is determined.
Decision
The Director of Planning approves:
i. Expenditure up to £15,000 to procure an external affordable housing viability expert for the development at 1 Portal Way, North Acton; and
ii. The receipt of up to £15,000 income from the applicant (Imperial College London) to meet the costs in full.
Part 1: Non-confidential facts and advice
Background and context
Imperial College London (ICL) have submitted a hybrid planning application (part full/part outline) for redevelopment of the site at 1 Portal Way for the construction of up to seven buildings to provide up to 1,325 residential units, 384 co-living units and c.30,000 sq.m of commercial floorspace in buildings of up to 56 storeys (227.75 metres).
The proposed scheme will follow the Fast Track Route under the Threshold Approach to affordable housing set out in London Plan policy H5. A full Financial Viability Appraisal is not therefore required and has not been submitted with the planning application. The applicant has however provided information about current day construction cost and residential values and a review of this information is required in order to inform the Early Stage Review Formula which will be included as part of any Section 106 Legal Agreement, in the event of a planning approval. Advice is also required to ensure the applicant’s payment-in-lieu of affordable housing for the co-living element of the development, meets the requirement of London Plan policy H16.
2. The proposal and how it will be delivered
The appointment of external consultants is required to assist OPDC in undertaking a robust assessment of the viability information submitted in support of the planning application. The consultants will undertake a high level review of the applicant’s current day construction cost and residential values on OPDC’s behalf and produce a report on the robustness and reasonableness of those costs and values.
The main duties of the appointed consultant will be:
- a review of the applicant’s adopted residential sales values based on the proposed unit sizes and mix
- a review of the applicant’s assumed private rents for each Build to Rent unit type, assumed operational costs and assumed investment yield, capitalised to provide a total investment value
- a review of the applicant’s assumed private rents for each Co-Living unit type, assumed operational costs and assumed investment yield, capitalised to provide a total investment value
- a review of the scheme’s elemental cost plan by an appropriately qualified and experienced Quantity Surveyor, including consideration of the site abnormals and apportioning costs across the buildings to inform the review formulas.
In the interests of ensuring value for money, officers have sought quotes from four sets of consultants and received two fee proposals in return. Officers propose to appoint BNP Paribas, who submitted the lowest quote. In terms of the two consultants who declined to bid, one consultant is unable to act on OPDC’s behalf due to an identified conflict of interest, and the other consultant advised they were unable to take on additional work at the moment.
Objectives and expected outcomes
The appointment of external consultants is required to assist OPDC in providing a robust assessment of the viability information submitted pursuant to the planning application.
Consultants with relevant recent experience are required to provide the necessary expertise and ensure affordable housing policy objectives are met. The outcome will be to maximise the delivery of affordable housing including the payment-in-lieu of affordable co-living accommodation.
The expenditure on external consultants for this work is expected to be up to a maximum of £15,000. This cost will be funded by the applicant. A written undertaking to meet these costs will be secured from the applicant.
4. Strategic fit
OPDC’s Post Submission Modified Draft Local Plan (PSMDLP) Place Policy 7 (North Acton and Acton Wells) supports the delivery of 6,200 new jobs and minimum of 8,000 new homes in this part of the OPDC area. Early delivery of 5,250 new homes is identified within the first ten years of the plan period. Policy SP4 (Thriving Communities) has an overarching 50% affordable housing target, subject to viability.
1 Portal Way is an allocated site within the PSMDLP and the proposed development of up to 1,325 residential units, 384 co-living units and c.30,000 sq.m of commercial floorspace represents a significant opportunity for delivery of PSMDLP objectives, including maximising the provision of affordable housing.
Under Section 149 of the Equality Act 2010, as a public authority, OPDC must have ‘due regard’ to the need to eliminate unlawful discrimination, harassment and victimisation as well as to the need to advance equality of opportunity and foster good relations between people who share a protected characteristic and those who do not.
Securing appropriate viability advice in relation to the 1 Portal Way planning application will contribute to the delivery of the regeneration objectives and maximising the delivery of affordable housing for Old Oak and Park Royal, as set out in the Opportunity Area Planning Framework and the draft OPDC Local Plan.
Project governance and assurance
This work will be overseen by the Principal Planner, who is also the Case Officer on the planning application. Duties will include instructing and liaising with the consultants, reviewing their draft findings and issuing the final report to the applicant.
Risks and issues
The contract will be managed in accordance with OPDC standard contract management procedures. If consultants are not appointed to assist with the work, there is a risk that the assessment of affordable housing viability would not be sufficiently robust owing to the need for expert advice. This could result in the scheme’s contribution to affordable housing not being maximised. Delays in appointing consultants, and consequential failure to determine the planning application in a timely manner, could lead to an appeal to the Planning Inspectorate on grounds of non-determination.
Other considerations
Consultations and impact assessments
The planning application has been subject to public consultation in accordance with the Town and Country Planning (Development Management Procedure Order) 2015.
Conflicts of interest
No one involved in the preparation or clearance of this Form, or its substantive proposal, has any conflict of interest.
The contract value for external consultancy, as described in this report, is expected to be up to £15,000. The Corporation will be receiving a commensurate amount of income from the applicant to meet the costs in full, therefore the commission will be of net cost to the Corporation.
The lead officer must ensure there is a written agreement with the applicant to pay the Corporation for these costs; this must be secured prior to any contractual commitments made by the Corporation with third parties.