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Agenda item

Brick by Brick Business Plan 2020/21

Officer: Jacqueline Harris Baker

Key decision: no

Decision:

The Leader of the Council delegated authority to the Cabinet to make the following decisions:

 

RESOLVED: To approve the proposed 2020/2021 Business Plan of BBB as set out in Appendix 1 of the report.

 

Minutes:

Members were provided with a presentation by the Cabinet Member for Homes & Gateway Services which gave an overview of the need for housing in the borough and the rationale for Brick by Brick. Members were directed to a quote on the Brick by Brick website which stated:

 

“It’s a way for Croydon Council to deliver much needed homes for local people, with the proceeds that arise from this process returned to the council to help fund frontline council services. This means that the profit created by Brick By Brick stays within Croydon. Local people get priority to buy our homes, and unlike most private developers the profit doesn’t line the pockets of individuals or get sent to shareholders overseas.”

Brick by Brick Ltd

 

The Cabinet Member highlighted that there were over 5,500 households on the housing waiting list, around 2,000 households in temporary homes and almost 1,000 children sleeping in emergency accommodation in Croydon. The council, it was noted, not only had a statutory duty to support those in need but also a moral duty to assist those residents.

 

The homes which Brick by Brick were building, the Cabinet Member noted, were of a high quality and were very sustainable. Additionally, to support local residents they were being offered on a Croydon First basis and were offered directly to those on the housing waiting list.

 

Colm Lacey, Chief Executive of Brick by Brick, also provided Cabinet with a presentation and gave an overview of the work of the company from when it started trading in 2016. The aim of the company was to ensure development of the area was undertaken differently with well-designed homes and support for the local community. Members were informed that the company was an important local employer with around 70% of employees being Croydon residents.

 

The presentation highlighted that 500 homes had been completed or were due to complete soon and that the company had delivered the refurbishment on Fairfield Halls in the last year. The trading figures, Members were informed, were due to be published in April 2020.

 

The Chief Executive acknowledged that Brick by Brick had experienced some challenges over the last 12 months with Brexit, which had impacted consumer confidence and the construction industry, some sites had been challenging and there had been difficulties with some contractors. However, Brick by Brick continued to develop and learn from those challenges.

 

Despite those challenges; there had been a number of opportunities as the company was starting to be the partner of choice for those seeking responsible development opportunities, the company had developed the way it consulted with local residents to ensure it worked closely with communities and it sought to become more environmentally sustainable with its work being audited by a climate emergency team.

 

Members were informed that another 11 schemes were due to be completed before 2020 and pipeline schemes had been assessed. The assessment had enabled Brick by Brick to increase its affordability to 70% for upcoming projects which would further support local residents to afford homes in the borough. Work had also begun with the Crystal Palace Community Land Trust to deliver the first community housing project in the borough.

 

The Chief Executive highlighted the key aims of Brick by Brick for the next year which included the adoption of ‘One Planet Living’, a stringent set of sustainability principles, achieve planning consent for more than 30 schemes which would deliver 800 additional homes and to start construction on around 12 new sites.

 

The Cabinet Member for Finance & Resources noted that the Brick by Brick developments made a difference to residents by delivering affordable housing which was supporting the housing department to deliver savings as fewer families would require temporary and emergency accommodation. Additionally, it was noted, the dividends and interest received from Brick by Brick were supporting frontline services of the council. Whilst there were financial benefits to the model of delivery, the important area of focus was the delivery of homes for families in the borough.

 

Opposition Members noted that the Brick by Brick aim of delivering much needed homes in the borough was positive, however felt that the delivery was not. When Brick by Brick was set up it was stated that it would be self-financing by 2020, however the latest Business Plan set out that it would not be self-financing until 2023. Concerns were raised that the loan amounts from the council were increasing, whilst Brick by Brick failed to deliver homes and used much loved green spaces across the borough.

 

The Chief Executive stated that it had been previously discussed that the estimate of when Brick by Brick would be self-financing had been revised in light of new schemes being brought forward which required funding. The profits were laid out in detail and it was stated that they had not gone down and that there was more certainty in 2019/20 profits. The Cabinet Member for Finance & Resources further noted that the forecasted profits were significantly ahead of what had been budgeted and that the risks associated with the company were detailed in the Business Plan.

 

It was noted that the Business Plan stated that it had been found that family houses were more popular than flats and in response the Cabinet Member stated that there was a need for homes of every size across the borough. Research, it was noted, had found that 48% of those on the housing waiting list required two bed homes whilst 20% required one bed homes.

 

The Leader noted the work of Brick by Brick and suggested that it was important that all Members noted that those living in the homes being delivered were benefiting as there was a need for more high quality and sustainable housing.

 

The Leader of the Council delegated authority to the Cabinet to make the following decisions:

 

RESOLVED: To approve the proposed 2020/2021 Business Plan of BBB as set out in Appendix 1 of the report.

 

Supporting documents: