Outrage over bid to cut affordable housing in Alveston House Hotel development

December 31 2021
Outrage over bid to cut affordable housing in Alveston House Hotel development

A DEVELOPER has been accused of breaking promises after asking to "water down" the affordable housing provided by a controversial scheme.

Prestige Homes Ltd was given permission to demolish the Alveston House Hotel next to the A38 in 2020.

The plans were approved by South Gloucestershire Council despite objections from 40 residents and the parish council.

They included complaints that only two of the 22 new homes would be classed as 'affordable' - available for social rent or shared ownership schemes.

Now the developer has asked for permission to change the plans again.

It now wants to classify the two homes as 'First Homes', which are sold for 70% of open market value, or make a £200,000 contribution to affordable housing elsewhere.

Asking South Gloucestershire Council's planning department to modify its legal commitments, the developer's agent, Stokes Morgan, said: "Having largely completed the build contract, the developer has identified that the scheme with the provision of 10% affordable housing places him in financial difficulties.

"This is not unexpected because the viability submitted with the application showed the scheme struggling to make sufficient development profit, given the high existing use value of the former hotel.

"However build costs have risen significantly which has compounded the problems with the development making it very difficult to deliver the affordable housing."

The agent's letter says ten of the new homes have already been sold for a total of £3.3 million, with the nine still on the market priced at £350,000 each and an overall 'gross development value' of £7 million for the site.

But they say the total cost of building the site has risen by at least 10% in the past 18 months, to £4.9m, on top of the costs of buying the site.

The agent said: "The scheme as approved currently runs at a deficit of £2.29 million and it is reasonable to request that the s106 Planning Agreement be modified."

The Alveston House Hotel was demolished to make way for the new development

Alveston Parish Council's planning committee has issued a statement to "strongly object", saying that its members "construe this as a deception on the part of the developer".

The council statement added: "Affordable housing is much in demand by local people and the original application was granted based on five affordable houses, which was then subject to a reduction to two houses, which was approved.

"Now this application is looking to deprive residents further by watering down the two remaining “affordable” homes to ‘First Time’ housing (they fetch more than affordable homes) or the payment of £200,000 for the provision of off-site affordable housing.

"In business there is always a risk involved with any venture and it is unfortunate for the construction company that the modern climate has created a reduction in margins, however this excuse is not a suitable reason to further break promises and obligations made during the planning process to district councillors and residents of the parish."

South Gloucestershire councillor Matthew Riddle, whose Severn Vale ward includes Alveston, said: “I am very concerned about this attempt to further water down of the development’s affordable housing offering through the new viability report and have made representations to the council to oppose this.

"South Gloucestershire Council has an excellent record of delivering of affordable housing in our communities, having provided almost half of the total number for the West of England area in 2019/20, and I am keen to see this continue.”

The council will now consider the application.

Top: Prestige Homes' plans for 22 homes incluided two calassed as 'affordable' but the developer now wants to change this