Agenda item

The purpose of this report is to provide an overview of the 23 shared ownership homes that form part of the acquired Grand Union (Block D) site and seek authority to dispose of these homes on the open market.

Cabinet NOTED the following comments made by Councillor Georgiou who had requested to speak at the meeting on the report.  In addressing Cabinet, Councillor Georgiou began by advising that whilst the properties being considered were located within his ward (Alperton) it was felt the issues raised had borough-wide implications.  On this basis, Councillor Georgiou advised he was seeking further clarification, following the response provided by Councillor Knight (as Cabinet Member for Housing, Homelessness and Renters Security) to a question he had raised at the Full Council meeting on 10 July 2023, on the reference made to repurposing as opposed to disposal of the homes.  In addition, details were sought on the original classification of the 23 homes and how this applied to their status and inclusion as part of the New Council Homes Programme, with Councillor Georgiou advising that in his view shared ownership did not represent an affordable housing model.

In reiterating the need to understand the process in terms of delivery of the New Council Homes Programme, Councillor Georgiou advised he was also seeking confirmation that any release of the units to an alternative provider would be at London Living Rent and, should that not be the case, for further clarity to be provided on the new model of ownership which had been referred to in the report.  Councillor Georgiou also felt there was a need to be clear on the length of lease being offered in relation to the release of the properties, the potential financial impact arising from the disposal and any requirement for Secretary of State approval.  Concerns were also highlighted regarding the timescale for the decision and impact on the availability of the properties since October 2022 along with the cost of financing any associated debt during this period in relation to the Housing Revenue Account.  In concluding, Councillor Georgiou advised that as a result of the issues raised and what he felt was further uncertainty around the Council’s plans for the ongoing delivery of affordable housing across the borough, he was calling for an Independent Scrutiny Task Group to be established to undertake a further detailed review of the approach, chaired by a member of the Opposition Group.

In responding to the comments raised, Councillor Butt (as Leader of the Council) advised that given the wide ranging nature of the issues raised he would arrange for a full response to be provided outside of the Cabinet meeting.

Having noted the comments received and content of the report Cabinet RESOLVED:

(1)      To authorises the proposed disposal of the 23 shared ownership homes at Block D, Grand Union (the Property) in accordance with the Council’s Constitution.

(2)      To recognise that in order to proceed with the proposed disposal of the Property reliance may be placed on the Secretary of State’s general housing consent.

(3)      To recognise that Heads of Terms will need to be agreed with relevant third parties in respect of the proposed disposal of the Property and authorise officers to negotiate and agree such Heads of Terms as may be necessary with the relevant thirds parties in relation to the same (which may include agreeing terms in respect of any variation which may need to be negotiated and agreed with regard to existing deeds).

(4)      To support the recommendation to proceed with the preferred option, offer 3 (as detailed in Appendix 1 of the report containing exempt information).

Prior to consideration of the main report, Councillor Muhammed Butt (Leader of the Council) invited Councillor Georgiou, who had requested to speak on the item, to address the meeting.  In addressing Cabinet, Councillor Georgiou began by advising that whilst the properties being considered were located within his ward (Alperton) it was felt the issues raised had borough-wide implications.  On this basis, Councillor Georgiou advised he was seeking further clarification, following the response provided by Councillor Knight (as Cabinet Member for Housing, Homelessness and Renters Security) to a question he had raised at the Full Council meeting on 10 July 2023, on the reference made to repurposing as opposed to disposal of the homes.  In addition, details were sought on the original classification of the 23 homes and how this applied to their status and inclusion as part of the New Council Homes Programme, with Councillor Georgiou advising that in his view shared ownership did not represent an affordable housing model.

In reiterating the need to understand the process in terms of delivery of the New Council Homes Programme, Councillor Georgiou advised he was also seeking confirmation that any release of the units to an alternative provider would be at London Living Rent and, should that not be the case, for further clarity to be provided on the new model of ownership which had been referred to in the report.  Councillor Georgiou also felt there was a need to be clear on the length of lease being offered in relation to the release of the properties, the potential financial impact arising from the disposal and any requirement for Secretary of State approval.  Concerns were also highlighted regarding the timescale for the decision and impact on the availability of the properties since October 2022 along with the cost of financing any associated debt during this period in relation to the Housing Revenue Account.  In concluding, Councillor Georgiou advised that as a result of the issues raised he was calling for an Independent Scrutiny Task Group to be established to undertake a detailed review of the Council’s approach (given the uncertainty highlighted) towards the ongoing delivery of affordable housing across the borough, chaired by a member of the Opposition Group.

In responding to the comments raised, Councillor Muhammed Butt (as Leader of the Council) advised that given the wide ranging nature of the issues raised he would arrange for a more detailed response to be provided for Councillor Georgiou outside of the Cabinet meeting.  Councillor Knight (Cabinet Member for Housing, Homelessness and Renters Security) was then invited to introduce a report which provided an overview of 23 shared ownership homes that formed part of the acquired Grand Union (Block D) site and was seeking approval to disposal of the properties.

In considering the report Cabinet noted the background to the acquisition of the Shared Ownership units as part of a wider scheme to acquire 92 units of social housing for London Affordable Rent within the Grand Union development.  Having assessed current market and economic conditions along with the reduced demand for shared ownership, members were advised that the Council had commissioned a marketing exercise seeking options to dispose of the units as a package to Registered Providers.  A summary of the offers received had been detailed in Appendix 1 of the report (containing exempt information) with the recommended option identified as best reflecting current demand from a housing and affordability perspective and best able to meet Brent’s ongoing housing need.  Confirmation was provided that the proceeds of any disposal would need to be treated as a capital receipt earmarked for the Housing Revenue Account (HRA) for use to fund new capital expenditure aimed at the ongoing delivery of the Council’s housing programme.

In supporting the approach outlined, Members commended the work being undertaken to ensure all available options were kept under review in order to address levels of housing demand across the borough and ensure the ongoing delivery of affordable housing.  It was felt his approach not only recognised the challenging nature of current market and economic conditions but also need to consider each site on a case by case basis and highlighted the need for clear and decisive leadership in terms of the decisions needing to be made, reflecting the nature of demand and the individual circumstances relating to each scheme.

Having considered the report Cabinet RESOLVED, having noted the exempt information contained in Appendix 1 of the report:

(1)    To authorises the proposed disposal of the 23 shared ownership homes at Block D, Grand Union (the Property) in accordance with the Council’s Constitution.

(2)    To recognise that in order to proceed with the proposed disposal of the Property reliance may be placed on the Secretary of State’s general housing consent.

(3)    To recognise that Heads of Terms will need to be agreed with relevant third parties in respect of the proposed disposal of the Property and authorise officers to negotiate and agree such Heads of Terms as may be necessary with the relevant thirds parties in relation to the same (which may include agreeing terms in respect of any variation which may need to be negotiated and agreed with regard to existing deeds).

(4)    To support the recommendation to proceed with the preferred option, offer 3 (as detailed in Appendix 1 of the report containing exempt information).