Greenwich Peninsula: 22.7% of new homes set to be ‘affordable’

Greenwich Peninsula developers' pavillion

Less than a quarter of homes on the new phase of Greenwich Peninsula development will be “affordable”, according to planning documents released by Greenwich Council last night.

Greenwich planners are recommending councillors approve the scheme at a meeting on Tuesday 8 September. Just 22.7% of homes of the 12,678 won’t be sold at full rate, the 320-page planning report reveals.

The original masterplan for the peninsula, agreed in 2004, envisaged 40% of homes being “affordable”.

But that stalled, and Hong Kong-based developer Knight Dragon – controlled by billionaire Dr Henry Cheng – which is now in charge of the scheme, has taken a much more aggressive approach to developing the huge site.

It controversially persuaded councillors to allow it no “affordable” properties at all on the plots nearest Canary Wharf, Peninsula Quays, leading to a legal row which resulted in Greenwich being forced to reveal the viability assessments it used to make the decision.

2004: Council newspaper Greenwich Time trumpets 40% "affordable" accommodation on the Peninsula. How things have changed...

2004: Council newspaper Greenwich Time trumpets 40% “affordable” accommodation on the Peninsula. How things have changed…

Greenwich has published the viability assessment for the new scheme, where consultants Christopher Marsh and Company pinpoint withdrawals of grants by the last government as a factor in the low figure.

“Some agency, or several, will receive significant sums via the original land agreement, and currently, none, it would appear, are prepared to re-cycle any share of those receipts back into affordable housing in Greenwich. That is a key driver in this case. Before February 2014, when Government largely abandoned grant aid to affordable housing, we would have expected most schemes to have exceeded 30% affordable housing. Without grant, that expectation has now been reduced by about one third.”

A further document from BNP Paribas compares the Peninsula scheme with property values at the Royal Arsenal in Woolwich – an improvement on the Peninsula Quays scheme where values across the whole borough were used, despite the unique nature of the site.

The document indicates that the headline figure for new homes remains 12,678, with towers of up to 40 storeys.

A quick skim through the papers would appear to indicate Greenwich planners have largely accepted Knight Dragon’s transport proposals, despite fears from a raft of local groups and even Transport for London that they will pile additional pressure onto North Greenwich station. An early reference to the “Silvertown Tunnel Rail Link” suggests that planners may not totally be on the ball here.

TfL says: “Jubilee Line crowding is already an issue and is forecast to continue in 2031. The additional crowding on Jubilee Line services is considered an issue. TfL cannot agree that the London Underground (LU) and National Rail networks would be largely unaffected by the proposed development.”

Indeed, council planners shrugged off calls for a pedestrian and cycle connection to Canary Wharf to relieve the Jubilee Line in just a sentence – “the feasibility of a pedestrian link between the Peninsula and Canary Wharf has been investigated previously but it is not considered feasible” – presumably a reference to an 2010 assessment by TfL produced to justify the construction of the Thames Cable Car, which said a bridge would not bring in any income.

The only explicit mass public transport improvement appears to be funding for a bus from Kidbrooke Village to North Greenwich – which is likely to pile even more pressure on the Jubilee Line.

There’s a lot to wade through, but it’s hard to see quite where Greenwich has tried to strike any worthwhile bargain with Knight Dragon. The big question remains – will the council’s planning board swallow Dr Cheng’s prescription?

7 comments

  1. Pelton Pirate

    Another meek capitulation by RG. Let’s see how long it takes for that percentage to drop in the next scheme revision that the planning board will doubtless nod through. Better keep complaining now folks, just in case we get told off for not doing so sooner again!
    I give up.

  2. Stewart

    I think the grant funding is a bit of a red herring to be honest. Given the fact that millions have already been ploughed in to decontaminate the area, and the sale of land below market value, there has already been massive public subsidy on this site.

    With the location, and the massive profits that the developers will achieve, reaching “affordable” homes targets shouldn’t be a problem.

    Greenwich have 15k families on their waiting list for properties – many of them have been on this list for decades. Not fighting harder for more homes is a dereliction of responsibility.

    It’s becoming increasingly clear that we’re not wanted around here, and only a matter of time before this spreads across the rest of the borough.

  3. fromthemurkydepths

    I’ve been looking at a few transport plans lately and most seem to employ some very curious predictions. Others elsewhere in the borough predict few using trains, for example, even though employment is increasingly concentrated in central London, and that just as many will travel in the Kent direction as London in the morning peak.

    The only additional boost to now come to the Jubilee is 6 extra trains an hour in 5 years – from 30 to 36 an hour. That has to cope with this development, Stratford’s large number, Canning Town as well which any trip through reveals huge expansion, to name but three. Writing off a bridge is ridiculously short sited given future need.

    Another stat I recently saw was that Greenwich was one of the very top boroughs in London when it came to approving schemes. Top 5 I believe, with a approval rate of something like 99%, compared to less in most other boroughs. Developers clearly know this, so why bother will good design or high levels of affordable housing as scrutiny and demands on them seem lower than elsewhere.

  4. jimreason

    What does “affordable housing” actually mean? That the council can buy it and offer it subsidised? Or just that it’s “20% below market prices”?

  5. The Hebridean

    If you can’t sleep at night trawl through some old planning schemes and you might well find that feasibility/viability studies are designed to make you think the issues, whatever they are, are being taken seriously. In the majority of cases, the study will actually find that the original proposal or request is not viable or feasible – that is “too expensive for the developer’s profit margin”. In my view most of these studies are just a fob-off and the developer will get his way, but a bit further down the road than he would have liked. It is all a game and as fromthemurkydepths says, it is one they know they are likely to win in Greenwich. Sad but true.

  6. 35% Campaign

    Just to add that the viability assessment for this scheme hasn’t actually been made public. What has been made public is an ‘abridged version’ of the viability assessment for popular consumption. It does not provide many of the key figures one would expect to see – like the rate at which sales values are expected to increase over the extended 20 year development period. It also provides no justification for the high profit level assumed by developer Knight Dragon (20% IRR) – this is equivalent to approximately 25% profit-on-cost, which is 5% above the accepted norm for major developments in London.

    Also while the officer’s report for the application says that 70% of the affordable housing will be social or target rent, the applicant’s Affordable Housing Statement says that 70% of the affordable housing will be ‘rented’. A minor difference in wording which could have major implications. The proof will be in the wording included in the S106 agreement, but this won’t be published until months after the planning committee has already approved the application.

  7. Pingback: 15,720 new homes approved at Greenwich Peninsula – joining thousands of others now underway | fromthemurkydepths

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