Solihull Council - Housing delivery through joint ventures and partnerships

"The outcomes from the Housing Advisors Programme will help the council to finalise its approach to housing delivery across a broad range of housing development sites to deliver the range of housing that can help support inclusive economic growth."


The challenge

Savills and Trowers advised on the ‘Development and delivery options on council owned land’. The case study was a 1.61 hectare council owned site in Balsall Common. The two options were:

  1. sale of the land
  2. partnership/joint venture with a private developer.

The report identified non-financial benefits associated with a partnership/joint venture approach.  A potential financial return to the council of £200,000 was identified on a 50/50 Joint Venture risk sharing basis with a private sector developer.

In this case the council is likely to conclude that 50 per cent of the risk of the development is disproportionate to the additional £200,000 potentially receivable.


The solution

The outcomes from the Housing Advisors Programme will help the council to finalise its approach to housing delivery across a broad range of housing development sites to deliver the range of housing that can help support inclusive economic growth.

The council's ‘Property Investment Board’ will consider a Housing Delivery Options report for the Hallmeadow Road site. It is likely that, rather than progress Joint Venture feasibility work, the preferred option in this case will be to approve the preparation of a brief for the marketing and disposal of the land for residential development by way of open market tender. The disposal brief may however specify that the affordable housing would be transferred back to the council and acquired by the Housing Revenue Account based on a pre-agreed price calculation methodology.


How is the new approach being sustained?

The work by Savills and Trowers will be used as further council sites come forward. The Joint Venture approach may be more applicable to a council owned site in Chelmsley Wood. This is a more complicated site than Hallmeadow Road and one where there may be more market uncertainty requiring a different delivery approach to open market tender.

Although Solihull has relatively few residential sites, the options work completed by Savills and Trowers has helped the council to think about its development objectives and the role of its Housing Revenue Account. This will help the council on future site delivery decisions.  


Lessons Learnt

It is always important for a local authority to be clear on its own objectives and local circumstances. What is appropriate for one local authority may not be so for another. The work we did with Savills and Trowers was very useful in developing our understanding across different parts of the council of different options. In Solihull, we anticipate that different options will be followed according to the nature of sites coming forward. 


Contact

John Pitcher, Solihull MBC (jpitcher@solihull.gov.uk)