185 Park Street is a development by Delancey DV4, developers of the Elephant & Castle shopping centre and Tribeca Square. The development comprises 3 buildings ranging up to 19 storeys in height and providing 163 private residential units.
185 Park Street is located on the south bank of the river nestled between the Tate Modern and the Globe theatre.
To be policy compliant, the development would have needed to provide a minimum of 57 affordable housing units on-site, of which 40 social rented.
Despite the District Valuer concluding that the scheme could support affordable housing to the value of £30 million (para 88 of officer’s report), the Council agreed that Delancey would instead provide an in-kind off-site contribution, in the form of the construction of 56 homes in Southwark Park road combined with an in-lieu payment of £6.5m.
What the officer’s report doesn’t say is that Delancey is construction the new ‘affordable’ homes for itself; that is the Council is selling it a nursing home on Southwark Park road, which Delancey will redevelop and then lease for a period of 50 years to a charity (United St Saviours). Nevertheless, Delancey remains the freehold owner of the site and building.
This Council report confirms that the site will be rented to the charity for 50 years. The report doesn’t specify the terms of the lease; i.e. how much rent the charity will pay to Delancey. In any case, after the 50-year lease expires, Delancey will regain the freehold of the building entirely unencumbered by any tenure conditions or requirements.
Paragraph 3.2 of this Council report confirms that there will be no section 106 conditions securing the new nursing home accommodation as social rent or any other affordable housing tenure.
To summarise then, the off-site ‘affordable’ housing is not secured by any legal agreement; its affordability depends for the first 50 years entirely upon the terms on which it will be rented to United St Saviours charity. Thereafter there are no covenants setting out the terms upon which the accommodation should be used - effectively what was a council-owned nursing home will be 57 privately-owned residential units to be disposed of on whatever terms Delancey so decides.
Without knowing how much the existing nursing home site was sold to Delancey for and on what terms it will be rented to United St Saviours, it is difficult to say with certainty, but at this stage it is looking like another good deal for Delancey and another bad deal for Southwark.