Agenda item

N.B. At this point in the meeting, the Co-Chair G Smith assumed the position of Chair for the meeting. 

 

C Howard introduced a report which requested the Board’s approval for six schemes with a total value of £9.794m Getting Building Fund (GBF) and Brownfield Housing Fund (BHF) and to give approval for delegated authority.

 

On 30th June 2020, the MCA had been awarded £33.6m GBF to invest in ‘shovel-ready’ projects that will provide stimulus to local economies.  The funds needed to be defrayed by 31^st March 2022, which allowed an 18-month delivery window.

 

To date, £13.326m grant had been approved across eight projects, with a further £7.255m for consideration in two projects presented in this report.  Four remaining projects were still to complete development and come forward for an approval decision.

 

The Board noted that the MCA had received confirmation of £40.34m BHF award on 22^nd December 2020 with the aim of creating more homes by bringing more brownfield land into development. 

 

The report requested approval of the first four BHF projects with a total value of £2.539m schemes. 

 

Peel Square (GBF)

 

The Appraisal Panel Summary Table attached at Appendix A to the report asked the Board to take a decision whether to support the proposal of a GBF grant of £1.755m requested by Barnsley Metropolitan Borough Council for renewal and diversification of the commercial and economic activity within Barnsley Town Centre.  The work includes the removal of stalls and clutter to open up views of the buildings and creating a flexible event space with opportunities for pop up stalls.

 

The project had a clear rationale and aligned to the SEP (Strategic Economic Plan) and RAP (Renewal Action Plan).  The risk around COVID both in the delivery of the capital works and the future use of the Town Square are considered.  The project was designed to create flexible town centre space which should help mitigate any longer-term impact of COVID. 

 

The project was considered able to deliver within the GBF timeframe, with planning in place and a contractor already procured.  Works were expected to be completed towards the end of 2021. 

 

The Benefit Cost Ratio (BCR) of the project was anticipated to be up to 1.94, which represents nearly £2 of benefit for every £1 of public money invested.  This was considered to represent acceptable value for money.

 

The project was recommended for approval with a condition of delivery being to agree to undertake a suitable evaluation on completion.

 

The Board considered and approved the project for award of a £1.755mgrant from the GBF.

 

Doncaster Town Centre – Quality Street (GBF)

 

The Appraisal Panel Summary Table attached at Appendix B to the report asked the Board to take a decision whether to support the proposal of a GBF grant of £5.5m requested by Doncaster Metropolitan Borough Council for continued delivery of the Doncaster Quality Streets programme to support and enable new investment in the town’s urban employment and residential development zones. 

 

The scheme includes a mix of traffic management, street lighting, junction improvements, active travel provision, landscaping and environmental improvements, as well as the provision of new digital infrastructure.

 

The project had also applied for £3.5m from the TCF (Transforming Cities Fund) which had been considered and approved by the Transport and Environment Board prior to the full £9m request being reported to the MCA for decision on 22nd March 2021. 

 

The project explained how it would meet Doncaster’s Inclusive Growth Strategy, their Cycling strategy and Local Plan.  It also aligned with the objectives of the Transforming Cities Fund and SEP (Strategic Economic Plan). 

 

The project was deliverable, with budget approvals set for March 2021, preliminary works and procurements were due to begin immediately and the Council planning to utilise in-house suppliers where possible.  The project proposed to create 400 jobs over a ten-year period.  The project presents a benefit cost ratio of 1.7:1.

 

Independent assurance of the business case accepts that the calculation is sufficiently detailed and uses robust methodologies.  Therefore, the project is considered acceptable value for money.

 

The project was recommended for approval to go on to the Mayoral Combined Authority meeting for a final decision at the March 22nd meeting.

 

A condition of delivery was recommended within the assurance panel summary to agree to undertake a suitable evaluation on completion.

 

The Board considered and recommended that the project be approved, subject to a final decision being taken by the Mayoral Combined Authority on 22^nd March 2021, for award of a £5.5m grant from the GBF.

 

West Bar (BHF)

 

The Appraisal Panel Summary Table attached at Appendix C to the report asked the Board to take a decision whether to support the proposal of a BHF grant of £0.655m requested by Sheffield City Council for the West Bar (Bridge Street Highways, Infrastructure and Enabling Works) project which will deliver a new highway retaining wall and road layout to facilitate 2-way traffic on Bridge Street junction with the Inner Ring Road (IRR), Openreach diversion works at Bridge Street and demolition works to clear the West Bar site to enable the construction works.

 

The work was part of a larger £150 million development to be delivered in partnership with the private sector.  Undertaking this work would assist towards enabling the delivery of 368 new private rented housing units, 430m2 of commercial floorspace and 5,500m2 of associated high-quality public realm.

 

The project fits well with the Council’s New Homes Delivery Plan and meets the objectives of the SEP.  The project had identified some delivery risks regarding cost increases with mitigations already in place to minimise the impact on the project.  Independent assurance had concluded that the project represents good value for money.

 

The assessment estimates that the uplift in land value is £2.7m.  This represents a BCR of over 4. 2.9

 

The project was recommended for approval with a condition to monitor the adequate progression of the scheme into delivery.  The project would also be asked to provide further explanation around why the national rules on subsidy control are not applicable in this project.

 

The Board considered and approved the project for award of a £0.655mgrant from the BHF.

 

Malthouses (BHF)

 

The Appraisal Panel Summary Table attached at Appendix D to the report asked the Board to take a decision whether to support the proposal of a BHF grant of £1.097m requested by Sheffield Housing Company for the Malthouses scheme.

 

The scheme aimed to deliver 73 new two, three and four bed homes on brownfield ex-housing land in Parson Cross, Sheffield.  The funding being sought is to fund the difference between the anticipated Gross Development Value and the higher Gross Development Cost of the scheme.

 

The project would deliver 3.65% of the local housing annual target and meets the objectives of the SEP. 

 

The project had identified key delivery risks of changes in costs or sales which may affect overall profitability.  These risks are mitigated by the applicant’s local experience and having a strong sales strategy in place. 

 

The timeline of project delivery was considered to be realistic, with construction works anticipated to begin in June 2022.  Independent assurance had concluded that the project represents acceptable value for money.  The assessment estimates that the uplift in land value is £1.298m.  This represents a BCR of 1.18.

 

The project was recommended for approval with a condition to monitor any excess profits, which if realised should be partly used to repay grant.  The project was also being asked to provide further explanation around why the national rules on subsidy control are not applicable in this project.

 

The Board considered and approved the project for award of a £1.097mgrant from the BHF.

 

Porter Brook (BHF)

 

The Appraisal Panel Summary Table attached at Appendix E to the report asked the Board to take a decision whether to support the proposal of a BHF grant of £0.350m requested by Sheffield City Council for site clearance of the Porter Brook site within the Cultural Industries Quarter of the Sheffield City Centre.

 

The project focuses on the demolition of a two-storey building on the Porter Brook site which is currently used for car parking, to provide a cleared site that is ready for development.  The applicant owns the freehold to the site and has secured vacant possession of premises.  Once the site is cleared, Sheffield City Council will seek developer interest for housing targeted at young professional workers, potentially via a build-to-rent development.  The site is estimated to have the potential to accommodate up to 200 one- and two-bedroom apartments.

 

The project had been assessed to have a clear rationale with previous attempts at private sector development unsuccessful.  With the Council undertaking the preparatory work this will bring the scheme forward in delivery by an estimated two years.  Risks are considered in relation to the wider development of the site.

 

The scheme was estimated to deliver a BCR of 1.4 and was therefore considered acceptable value for money.  Other indirect outcomes such as improving the local labour pool or increasing the visual benefits from the area being enhanced may also add additional value to the scheme.

 

The project was recommended for approval with conditions to adequately monitor the progression of the scheme.  Further risk register information had been requested which deals with risks related to the demolition and site clearance.

 

The Board considered and approved the project for award of a £0.350mgrant from the BHF.

 

Rotherham Metropolitan Borough Council (RMBC) Small Sites (BHF)

 

The Appraisal Panel Summary Table attached at Appendix E to the report asked the Board to take a decision whether to support the proposal of a BHF grant of £0.434m requested by Rotherham Metropolitan Borough Council to enable the development of affordable housing on existing brownfield sites.

 

As part of the Council’s Housing Development Programme, 32 homes for rent would be delivered across three schemes, comprising nine Housing Revenue Account (HRA) owned sites. 

 

Scheme 1 focuses on delivering 14 bungalows across two sites, scheme 2 is in East Herringthorpe with plans to deliver 13 houses across 5 sites and scheme 3 is in Thrybergh, delivering 5 houses across 2 sites.

 

MCA funds are requested to contribute towards land remediation and preparation prior to housing development to help address the viability gap for the sites in question.

 

The project meets Rotherham Metropolitan Borough Council’s local policies and will assist towards meeting annual Council targets.  It also contributes towards the themes within the SEP aiming to improve the quality of existing and new housing stock.

 

The project was estimated to have a BCR of 1.3 which was considered acceptable value for money.  Additional national guidance to value the benefits of regeneration indicate that more than £1.5m of indirect benefits may arise from the investment.

 

Scheme 1 was considered delivery ready, with future schemes planned to take place at a slightly later date.

 

The project was recommended for approval with conditions to adequately monitor the progression, particularly the delivery of schemes 2 and 3.

 

T Hawley highlighted that Homes England would be looking to invest in some of the homes in the scheme through the Affordable Housing Programme.  Following examination of Government’s guidance, Homes England would be responsible for claiming the outputs for the completion of these homes, where they had utilised an Affordable Housing Grant on a property. 

 

The Board considered and approved the project for award of a £0.434mgrant from the BHF.

 

RESOLVED – That the Housing and Infrastructure Board considered and approved:-

 

1. The project ‘Barnsley Town Centre Public Realm – Peel Square’ for award of £1.755m grant from the Getting Building Fund subject to the conditions set out in the Assurance Panel Summary Table attached at Appendix A.

2. The project ‘Doncaster Town Centre Quality Streets’ for consideration at the MCA (Mayoral Combined Authority) for award of £5.5m grant from the Getting Building Fund subject to the conditions set out in the Assurance Panel Summary Table attached at Appendix B.

3. The project ‘West Bar’ for award of £0.655m grant from the Brownfield Housing Fund subject to the conditions set out in the Assurance Panel Summary Table attached at Appendix C.

4. The project ‘Malthouses’ for award of £1.097m grant from the Brownfield Housing Fund subject to the conditions set out in the Assurance Panel Summary Table attached at Appendix D.

5. The project ‘Porterbrook’ for award of £0.350m grant from the Brownfield Housing Fund subject to the conditions set out in the Assurance Panel Summary Table attached at Appendix E.

6. The project ‘RMBC – Small Sites’ for award of £0.434m grant from the Brownfield Housing Fund subject to the conditions set out in the Appraisal Panel Summary Table attached at Appendix F.

7. Delegated authority be given to the Head of Paid Service in consultation with the Section 73 and Monitoring Officer to enter into legal agreements for schemes 1, 3, 4, 5 and 6 covered above.

 

N.B. At this point in the meeting, the Co-Chair Councillor Johnson re-assumed the positon of Chair for the meeting.