Say they will make property companies fully disclose finances of their projects
In reaction to the decision by Wandsworth Council to cut the number of affordable homes in the Battersea power station development, the Labour party in Wandsworth have put forward new proposals which would force developers to explain why and publicly reveal their profits.
Under the scheme fFinancial viability assessments will be released, without redaction, for local people to see whether or not developers are putting their own interests ahead of the public interest.
Last week, Wandsworth Tory councillors agreed to a Labour Motion demanding that developers are made more accountable to the public by making their viability reports as transparent as possible to enable the public “to see for themselves that the developers are contributing their proper share of affordable housing”.
The Mayor of London Sadiq Khan has also tasked a team of experts to look into the issue of developers’ viability assessments which he believes are being used to reduce the number of affordable units being built. Targets laid down by the Mayor of London require developers to deliver 35% affordability on private land and 50% on public land. However viability reports are often used by developers to justify reducing that amount. The developers claim less housing will be built if they always have to meet high targets for units that are classed as affordable. These units do not necessarily need to be social housing but can be available to buy or rent at discounts of as little as 20% making them beyond the reach of most low and middle income earners.
Wandsworth Labour Housing Speaker, Paul White said “This is an important step forward, but if Wandsworth Labour take the Council, we would go further by insisting that developers who don't build the required affordable housing would be made to publish unredacted viability studies to explain why”.
Cllr Paul White addresses the Council
The Motion was brought by Battersea Cllr Aydin Dikerdem who recently presented the Council with a petition signed by over 21,000 people objecting to the Council’s decision to allow the developers at Battersea Power Station to reduce the amount of affordable housing on the site from 15% to just 9%.
According to the Battersea Power Station developer’s viability estimates, the redevelopment could have provided a profit of approximately £1bn if 35% of the housing delivered had been affordable. However the developers argued that this amount of affordable housing – equivalent to 1,375 homes rather than the 386 that will now be built – would have made the regeneration non-viable.
Cllr White added, “‘viability’ has nothing to do with whether the project can go ahead or not, but is about how much profit the developers will make. Of course developers say costs are increasing too much – they are private, profit seeking entities and their viability reports are a secret. However had the Battersea Power Station developers stuck to their agreement to provide 15% affordability, already considerably less than the 35% required by the Mayor, their profits would have still been in excess of £1bn”.
“The concession made by Tory cllrs last week to make viability reports more open and transparent is an important step that should enable residents to scrutinise the rationale given by developers as to why they can’t provide real affordable housing, making it easier for residents to hold them to account and hopefully harder for Wandsworth Council to capitulate to their demands. But we would go further”.
Cllr White concluded: “Only 8% of Londoners can afford 80% of its housing. By forcing developers to no longer hide behind secret viability reports, we would be able to reverse this trend and provide more genuinely affordable homes for the people of this borough”.
Following the Mayor’s announcement regarding using his planning powers to increase the amount of affordable housing on a development in Wandsworth, Local Assembly Member Leonie Cooper has said: "All developers in Wandsworth should now be on notice that regardless of the location of their developments, their scale or their size, the Mayor wants to see the housing needs of all Londoners catered for, not just those who can afford luxury developments."
October 18, 2017