Issue - meetings

The Executive Member for Regeneration submitted a report for Executive’s consideration.

 

The report sought Executive approval to dispose of the Council’s freehold interest in Hemlington North for affordable housing development in accordance with the Council’s Asset Disposal Process.

 

There was strong continued demand for new homes in Middlesbrough and as such the town required a significant supply of new housing development over the next decade.

 

Middlesbrough’s population had grown in recent years, as the number of new developments had increased, and the wider housing offer had started to improve Despite Middlesbrough’s modest growth the housing offer in the town lacked key types of products that would allow the area to keep pace with national demographic trends.

 

There was significant demand for additional affordable housing products within Middlesbrough’s housing offer and this site offered an important opportunity for more affordable housing provision.

 

The development of new housing was a key component of the Council being able to set a sustainable budget, as the capital receipts from housing sites, along with the subsequent Council Tax were the key components of the Medium-Term Financial Plan.

 

Hemlington North measured approximately 1.77 Acres [0.71 Hectares] and was close to current developments by several commercial housebuilders forming part of the Hemlington Grange urban extension.

 

The site was marketed using appropriate property development websites, an article in a local newspaper and the Council’s own website/social media channels for two months. Two bids were received by the closing date of 5th May 2023.

 

Two bids were received at the same value, although based on significantly different assumptions. One bid was based on delivering just 20 units of housing, and included conditions that could potentially reduce the Council’s return, whilst the bid from North Star Housing Group was based on 35 units of affordable housing (subject to planning permission) and provided greater financial certainty.

 

In assessing the bids further, the 20-unit scheme was ultimately deemed non-compliant due to the format of the bid, leaving the bid from North Star Housing Group as the preferred choice. As a result, the bid from North Star Housing Group was recommended for approval.

 

The site was located in Stainton and Thornton Ward and the relevant Ward Councillor had been consulted.

 

ORDERED that Executive accept the bid of £300,000 from North Star Housing Group for the Council’s freehold interest in Hemlington North so that the site can be developed for affordable housing.

 

OPTIONS

Re-use for operational purposes

 

No Council operational service requirement had been identified.

 

Other uses

 

The land was allocated for affordable housing and therefore an alternative use was not proposed.

 

Do nothing

 

Whilst the land would be retained for potential Council use in the future, the liability and responsibility for maintaining the land would remain with the Council in the interim.

 

REASONS

 

Disposal as proposed would generate a significant capital receipt, increase annually recurring revenue streams, and increase the supply of affordable housing.

 

Disposal of the site supported delivery of the Council’s Medium Term Financial Plan.