The London borough of Croydon has set up its own housing developer, to help improve the delivery of new homes in its area.
The establishment of Brick by Brick, as the company has been called, is another first for the forward-thinking borough. It starts with a pipeline of more than 50 sites, on which around 1,200 new homes will be built. And, unusually for a local authority, they will not be council houses, but homes for private sale and shared ownership – with a good percentage of affordable properties too.
The arms-length company is completely owned by the local authority, which is its sole shareholder; but has the power to act free of normal public sector restrictions. “It’s set up to be an equal competitor to the private sector,” explained Colm Lacey, the managing director of the new company who is also the council’s director of development. “The strategic brief is to look to see how we can commercialise development.”
Brick by Brick’s board is made up of Lisa Taylor, the borough’s head of finance and two independent, non-executive directors Jayne McGivern and Jeremy Titchen.
“One of the greatest challenges for Croydon, along with the rest of London, is the provision of new, affordable homes. The borough’s population is rising and ‘business as usual’ is not an option. The aim of Brick by Brick is to ensure Croydon people have access to high quality housing and that the full value of development growth is kept in the borough – whether in the form of additional affordable housing, physical improvements in the local centres or dividend return to the council to fund council services.”
Lacey told London Planning Analyst: “The council has lots of parcels of land around the borough that it has struggled to bring into use.” Many will have capacity of between 20 and 40 homes, a scale that councils can struggle to effectively dispose of to private developers.
“We’ve taken on seven external architecture practices to do planning work for us.” The seven are Pitman Tozer, Mikhail Riches, Stitch, Mae, vPPR, Coffey Architects and HTA; an in-house design team will also carry out some of the work.
Lacey said he aims to get projects to planning committee in the summer, for building work to start on site in early 2017. He is open minded about the style of construction to be used, noting: “We are looking to see where we can slot in modular.”
The council is selling the sites to Brick by Brick “at best consideration. It’s a very transparent model of appraisal.” Finance for development will also be loaned from the council, and any profit from the enterprise will be returned to the local authority as a shareholder dividend.
“These are private developments,” clarified Lacey. While the exact levels of affordable housing from each site has yet to be determined, the idea is to better Croydon’s current requirements – “I think we will be able to deliver way more affordable.”
He expects the homes to be sold for prices in the range £400-700 per square foot. “It’s comparatively affordable in London – this will be a product for local people.” A tranche of shared ownership properties is also likely to be offered.
Lacey said that with the structure of the company agreed, the key challenge will be managing a large workflow – both through the borough’s planning process, and in finding suitable contractors willing to carry out the building work.
Looking further ahead, Lacey sees Brick by Brick looking to develop other publicly held sites in the borough, and working further afield – possibly helping adjacent boroughs capitalise on their problematic sites, too. “There’s no reason why we couldn’t think outside the borough.”
LPA Perspective: Hooray, a local authority has worked out how to build houses on sites it owns, without getting skinned by private developers, or bound up about whether it should build council houses. This pragmatic answer from Croydon promises to deliver good value homes for the private market, at a faster pace than private developers would deliver, with profits returned to the council. And, it’s using proper architecture practices to design the homes, too.
There will be some challenges along the way, not least finding builders to take on a goodly scale of work. Lacey might sensibly take a look at some prefabricated solutions, such as the YMCA’s Y:Cube, already used nearby in Mitcham.
The other issue Brick by Brick needs to be aware of, is selling at the right price. Too cheap, and not only will there be a queue of buyers around the block, but the profit that could be returned to the council to fund other projects could be lost to happy buyers.
But get this right, and what other London borough will not be interested in either hiring Brick by Brick, or working with them to learn how best to get more homes built, quickly and at sensible prices.