October 1 2014 Latest news:
Emma Lake, Reporter
Thursday, September 4, 2014
A developer’s attempt to delay the payment of £5million towards affordable housing has been branded “shameful” by a Liberal Democrat councillor.
While the Recorder has been investigating the depths of Redbridge’s housing crisis the developer of luxury flat complex Pioneer Point, Ilford, has said that if it is not allowed to spread its affordable housing contribution across a 10-year payment plan nothing will be paid for up to seven years.
Cllr Gwyneth Deakins, deputy leader of the Lib Dem group, said: “The system is not fit for purpose if it is difficult, or impossible, for councils to get this money which is so desperately needed to help provide housing.
“The developers themselves should have made provision to pay this money whatever the economics of the project, and not to do so would be shameful.”
Pioneer Point had agreed to make a £3.78m contribution towards off-site affordable housing after obligations to provide affordable housing within the 294-unit development were removed in 2012.
Increases in line with the financial markets mean the amount owed is now more than £5m to be paid as soon as the development reaches a 75 per cent occupancy rate.
Pioneer Point is in administration and being managed by Trevor O’Sullivan and David Dunckley. Within the application to vary payment conditions to Redbridge Council, the administrators’ agent, Montagu Evans, said its clients will not allow the occupancy rate to reach 75pc unless modifications are made.
It proposes paying £380,000 in the first year followed by annual payments of £430,000.
Mr O’Sullivan said: “The principal reason for seeking this modification is to bring the South Tower into beneficial use as it has been standing empty since completion in November 2012.
“The amount payable is not reduced by the proposed variation furthermore there are significant benefits that will accrue to local businesses in letting the South Tower. The alternative is to leave the tower empty since selling the apartments in the housing market will crystallise very significant losses to the development.”