How Khan faced down boroughs in the hunt for cheap homes

Mayoral consents for two big residential schemes in the face of borough opposition suggests the mayor will help developers who boost affordable housing numbers, say experts.

Mill Hill, Barnet: the London mayor approved the scheme after the percentage of affordable housing doubled
Mill Hill, Barnet: the London mayor approved the scheme after the percentage of affordable housing doubled

In April this year, Wandsworth Council’s planning committee met to consider plans for 343 flats on the site of a Homebase Store on Swandon Way. It was the second time that the site’s developer, the National Grid UK Pension Scheme, had reached this stage. An earlier iteration of the project had already been rejected on the basis that it was too tall. However, despite attempts to address councillors’ concerns, reducing the height of the scheme by two storeys, the pension fund found itself rebuffed once again.

The council’s decision would prove to be a temporary setback. Last month, London mayor Sadiq Khan announced he had approved the scheme after calling it in for his own consideration in June. Announcing his decision, the mayor pointed to an increase in the size of the project, to 385 units, and the amount of affordable housing to be provided, from 23 to 35 per cent. "I’ve made it clear I am committed to increasing the delivery of genuinely affordable housing in London and I will use my full range of planning powers to achieve this," said Khan.

This wasn’t the only change that had been made. Despite Wandsworth’s concerns, the approved scheme was now 17 storeys high, the same height as it was when it was first refused. Anthony Lee, head of UK residential consultancy at BNP Paribas Real Estate, says the decision sent a clear message. "The townscape issues that the scheme raises [were seen as] less important than providing affordable housing," he says.

When Khan became London mayor in May 2016, he promised to get to grips with the city’s housing crisis. During the election, he’d promised to set a target for 50 per cent of all new homes to be affordable. By November, this figure had been relegated to a "long-term strategic goal", with a short-term target of 35 per cent.

Khan’s recent decisions suggest he’ll be standing firm on this target. Two weeks before his decision in Wandsworth, the mayor approved Barratt’s plans for 460 homes on the National Institute for Medical Research site in Mill Hill, in Barnet, after negotiations which saw the level of affordable housing raised from 20 to 40 per cent. Simon Ricketts, planning partner at law firm Town Legal, says: "It’s becoming very plain that he’s prepared to intervene to assist developers where they are providing a high proportion of affordable housing but are being knocked back by the boroughs."

Both cases were approved in accordance with the mayor’s Affordable Housing and Viability Supplementary Planning Guidance (SPG), which was published in August. The SPG offers developers a fast-track route through planning for cases which meet or exceed the 35 per cent affordable housing threshold. While the guidance is non-statutory, Ricketts says: "Applicants ignore the detailed requirements of the SPG at their peril. The mayor is looking to achieve as much compliance with the detailed requirements of the SPG as possible. It’s there centre stage in terms of setting the ground rules."

According to the GLA, this approach seems to be working: the four developments Khan has called in since taking office have provided an average of 37 per cent affordable housing. However, Lee suggests it’s only a matter of time before developers begin to push back. "So far we’ve had a couple of decisions where the mayor has driven a hard bargain," he says. "There will come a time, and it will probably not take too long, where a developer will stand up to the mayor and say, ‘we’ve given you our viability assessment, we know the numbers are correct, if you continue to press us for 35 per cent we’ll argue that in front of an inspector’." The outcome of such a stand-off would likely influence all similar discussions in the future. Lee says: "If someone successfully challenged the 35 per cent figure, than clearly that will encourage a lot of other developers to negotiate."

A new iteration of the London Plan, expected later this year, may go some way to strengthening Khan’s position, providing an opportunity for the mayor to set out his approach within a statutory document. Roy Pinnock, planning partner at Dentons, says it will be interesting to see whether Khan chooses to cement the approach taken in Wandsworth, where the scheme’s impact on the townscape was seen to be less important than its capacity to provide affordable housing. "Because mayoral call-in decisions will remain rare, the issue is going to be much more about how the London Plan grapples with densification debates," he says.

The London boroughs will be among those watching closely. Mike Kiely, chair at the Planning Officers Society, which represents local authority planners, says Khan’s recent decisions have already prompted concerns among local authorities. "I’ve certainly had feedback from boroughs in London saying he has increased housing numbers irrespective of the other issues involved," he says. "The worry is that it’s about housing numbers at all costs."

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