Comment

Representation ID: 10085

Received: 28/07/2022

Respondent: Churchill Retirement Living

Agent: Ziyad Thomas

Policy DM1(S) Affordable Housing sets a flat affordable housing requirement of 30% across the district.

The Local Authority is aware of the increased emphasis on Local Plan viability testing in Paragraph 58 of the NPPF, particularly given the proposed requirement for a mid­ stage review Policy Df'v12: Review Mechanism. The evidence underpinning the Council's affordable housing requirement should therefore be robust and we would respectfully remind the Council that the PPG states that "The role for viability assessment is primarily at the plan making stage Viability assessment should not compromise sustainable development but should be used to ensure that policies are realistic, and that the total cumulative cost of all relevant policies will not undermine deliverability of the plan" (Paragraph: 002 Reference ID: 10-002-20190509).

The affordable housing targets set out in Policy Df'v17(5) Affordable Housing are informed by the evidence base - namely the Bedford Local Plan 2040 - Borough­ Wide Viability Study (2022) undertaken by BNP Paribas.

In reviewing the methodology for assessing specialist older persons' housing, we note that many of the inputs align with the methodology detailed in the Briefing Note on Viability Prepared for the Retirement Housing Group (hereafter referred to as the RHG Briefing Note) by Three Dragons, although a number do not. Our concerns are that the Viability Assessment has overplayed the viability of older persons' housing.

Mindful of the guidance in the PPG that is the responsibility of site owners and developers to engage in the Plan making process. Churchill Retirement Living have provided commentary and supplemental evidence and their own viability appraisal in a separate document entitled 'Review of Local Plan Viability Assessment for Sheltered Housing'. All the scenarios tested result in substantial negative residual land value. The extent of the deficit is such that it clearly demonstrates the existing framework of planning obligations and policy requirement places an unacceptable burden on specialist older persons' housing in the area.

The result of the Churchill Retirement Living viability assessments reflect the findings of the Council's own evidence base. The results of the Council's viability modelling for sheltered housing are provided in Appendix 5 of the Bedford Local Plan 2040 - Borough-Wide Viability Study (2022) undertaken by BNP Paribas. There is not a single scenario in which retirement living accommodation can viably deliver all the requirements of the Local Plan - Planning contributions, Accessibility (M4(2) & M4(3)), Biodiversity & Future Homes. In most instances the residual land value is negative by several million pounds.

Indeed, there is only one scenario in which sheltered housing can deliver 30% affordable housing - the highest value area (CIL Value 5) with the lower value greenfield benchmark land value. This does not include any of the other policy requirements, such as s106 contributions and accessibility standards. This is also a highly unlikely scenario as the highest sales values for retirement living apartments will not be achieved in lower value areas.

The Local Plan Viability Study provides an 'understated' summary of the viability of older persons' housing typologies advises that

6.25 Given the Council's requirement for the delivery of specialist accommodation, which meets a required need in the borough providing for older persons and people with disabilities and special needs, we have tested the viability of delivering such schemes in the borough. The results of our appraisals testing older persons' accommodation demonstrate that the viability of retirement I
sheltered housing schemes in the borough can be challenging (see Appendix 5), except where schemes come forward at higher sales values and on sites with lower existing use values. The Council's policy allows for the consideration of viability when determining residential schemes. We consider that this flexibility will ensure that such development continues to come forward over the life of the plan and will deliver the maximum reasonable amount of affordable accommodation.

It is our view that the viability testing for sheltered housing typologies in the Local Plan Viability Study clearly show that the proposed planning policy regime in Bedford will render this form of accommodation unviable. These conclusions should have prompted the Council to revisit the policy requirement for this form of accommodation so as to not jeopardise its delivery of the Local Plan period.

Conversely however, the planning policy requirements for older persons' housing are higher than for other forms of housing. Policy DM3(S) Housing Mix stipulates a requirement for all units of specialist older persons housing to be built to M4(3). The Local Plan Viability Study advises the cost of flats to meet M4(3) is fll,000 per flat (which the respondent considers to be a conservative figure) resulting in an increase to the build cost of a typical SO-unit scheme of £550,000

We acknowledge the PPG does states that circumstances that justify the need for a viability assessment at application stage can include where particular types of development are proposed which may significantly vary from standard models of development for sale (for example build to rent or housing for older people) (Paragraph ID: 10-007-20190509).

The guidance in the NPPF and the PPG is that the role for viability assessment is primarily at the Plan making stage:

Where up-to-date policies have set out the contributions expected from development. planning aoolications that comoly with them should be assumed to be viable. It is uo to the aoolicant to demonstrate whether particular circumstances iustify the need for a viability assessment at the aoolication stage. The weight to be
given to a viability assessment is a matter for the decision maker, having regard to all the circumstances in the case, including whether the plan and the viability evidence underpinning it is up to date, and any change in site circumstances since the plan was brought into force (paragraph 57.)

Council Members, Officers and the general public will assume that applications for sheltered or extra care housing will be able to support a policy compliant level (30%) of affordable housing. This would however be at odds with the viability evidence underpinning the Local Plan. Furthermore, no reference is made to the inability of older persons' housing typologies providing policy compliant levels of affordable housing in either the text of the Policy DfVIJ(S) or its justification. Burdening specialist forms of accommodation with an unrealistic affordable housing requirement on the presumption that viability will be considered on a site-specific basis, but not making this clear to either developers or Council Officers in the wording of the policy creates both uncertainty and a significant opportunity for conflict. This is particularly concerning as the NPPF and the PPG both make it clear that the weight attributed to a viability assessment is to at the discretion of the decision maker.

The proposed planning policy requirements placed on specialist older persons' housing would render it undeliverable and as such the Policy DMl(S) and Policy DM3(S) fail the tests of soundness in Paragraph 35 of the NPPF.

We are strongly of the view that it would be more appropriate to set a nil affordable housing target for sheltered development, at the very least in urban areas. This approach accords with the guidance of the PPG which states that 'Different (affordable housing) requirements may be set for different types or location of site or types of development' (Paragraph: 001 Reference ID: 10-001- 20190509).

To that end, we would like to draw the Council's attention to Paragraph 5.33 of Policy HPS. Provision of Affordable Housing in the emerging Fareham Borough Local Plan which advises that

5.33 ... The Viability Study concludes that affordable housing is not viable for older persons and specialist housing. Therefore, Policy HPS does not apply to specialist housing or older persons housing

A nil affordable housing rate could facilitate a step-change in the delivery of older person's housing in the Borough, helping to meet the diverse housing needs of the elderly. The benefits of specialist older persons' housing extend beyond the delivery of planning obligations as these forms of development contribute to the regeneration of town centres and assist Council's by making savings on health and social care.

RECOMMENDATION:

Churchill Retirement Living consider that the conclusions of the Bedford Local Plan 2040 - Borough-Wide Viability Study (2022) do not provide a credible basis for proving a flat 30% affordable housing rate across the Authority.

The Viability Assessments concludes that sheltered housing cannot support affordable housing contributions of 30% or the additional policy costs of building to an enhanced accessibility standard M4(3). These conclusions reflect our own, albeit we consider that the viability of older persons' housing typologies has been overstated, as several the viability assumptions do not reflect our experience in bringing these forms of development forward.

The proposed planning policy requirements placed on specialist older persons' housing would render it undeliverable and as such the Policy DMl(S) and Policy DM3(S) fail the tests of soundness in Paragraph 35 of the NPPF.