Regeneration

Regen 60

Written evidence submitted by Rochdale Metropolitan Borough Council

Oldham & Rochdale Housing Market Renewal

Background

Oldham & Rochdale were awarded a joint Housing Market Renewal Pathfinder programme (HMR) in 2004 to transform neighbourhoods within the two boroughs and make them desirable to live in, both now and in the long term. The pathfinder’s objectives were to:

· Create a step change in housing diversity and choice

· Transform the quality of housing and deliver long term sustainability

· Promote and provide a range of affordable housing options

· Support the economic development of Oldham and Rochdale, and the wider region:

· Promote community cohesion

· Provide an excellent quality of life

Rochdale MBC

Initially the Rochdale programme was focused on the first wave neighbourhoods of Langley and East Central Rochdale but this was extended to include two further neighbourhoods, Inner Rochdale & Kirkholt, in 2006.

All new housing being developed under the initiative will be built to Code for Sustainable Home Level 4 and construction will be undertaken using a contractually agreed percentage of local labour and suppliers.

In addition, to maximise the potential regeneration effects local supply chain activity will be maximised by way of targeted marketing to engage with local firms. This will also be a catalyst to develop both training and employment opportunities for the population of the boroughs and wider region.

First Wave Neighbourhoods

· Langley

Langley is a housing estate in Middleton on the edge of the Borough of Rochdale. Following the stock transfer of former Manchester City Council social housing to Riverside in 2002, a programme of Decent Standard improvement to around 2,200 homes was completed in 2008. A number of specific surplus sites have also been developed, or identified for development for market housing by Lovell, Riverside’s development partner. Significant sums have been invested to assemble other potential development sites as part of the government’s Housing Market Renewal Initiative.

An ambitious Vision and Masterplan for Langley has been developed and these were refreshed in 2009. As the formally adopted strategic guides for investment the Masterplan builds on the investment made so far, including proposals for:

· Additional new market and social housing, delivered to a high standard, to meet growing demand in the borough;

· An improved environment including a Green Space Corridor - a network of new and improved green spaces; and

· Replacement of the existing poor quality Central Core, with new retail facilities and housing at an appropriate scale to meet local needs and create vibrancy at the heart of the estate along with other public and community services.

As part of the Oldham Rochdale HMR Pathfinder there has been investment of around £15.5m on the Langley Estate in Middleton.

Work in the area has been undertaken in partnership with the local RSL – Riverside Pennine, and their development partner – Lovell Partnerships.

As part of the early wins funding in 2003 we acquired a number of properties (25 houses, 24 flats and 3 empty pubs) to create cleared sites and enable early development to take place.

When the main programme commenced in 2004 the focus of HMR investment was on environmental improvements and over 600 homes received improved front boundaries and parking spaces in key development or future development areas, thus lifting the once poor perception of Langley as an area.

At the same time as this investment was taking place Riverside Pennine were commencing a 5 year, £32m investment programme in their 2,200 homes and Lovell had commenced the building of new homes for sale with a planned build profile of 800 new homes over 10 years.

In order to deliver the objectives of the programme we have been acquiring properties to create the necessary sites. We have acquired and demolished 31 occupied homes, 190 empty homes (includes 180 in the 3 tower blocks) and a former school, library, community centre and church.

There is a clear development profile which is scheduled to commence this year but it is anticipated that the market is not strong enough in areas like Langley without financial support. We are about to test this in the market.

Additional activity that has taken place on Langley with HMR support has been the building of 72 new apartments for rent in two phases by Riverside Pennine, the latter phase to code level 4 standards. This has been mainly HCA funded with support from HMR to improve the quality and sustainability.

Lovell have built and sold over 300 new homes in the area but have suffered from the housing downturn, requiring them to reduce prices significantly to enable people to get the necessary deposits to secure a mortgage. They have also just completed 50 new homes as part of the recent Kick Start programme.

There has been a range of other investment in the area ranging from remodelling of two schools, a new £17m Academy, new Children’s Centre and Library and most recently investment from Tesco in the form of a new Express store.

In addition to the work above we have entered into an innovative arrangement with Riverside Pennine to produce a Land Pooling Agreement (LPA). This agreement relates to land ownership of both parties within the area and ensures that we are able to develop jointly owned sites without any problems. It also ensures that all receipts for land sales are reinvested back into Langley in the future.

All of this shows that confidence has been building in the area with people now wanting to move to Langley who previously would have not considered it an option. Our big concern is that without the right investment the planned programmes will stall and there is a risk that Lovell may move away leaving a number of vacant sites which, if added to the HMR sites, will start to create a worsening image again and potentially undo a lot of the good that has been done.

It has been estimated that investment of around £2.4m over the next 3 years could unlock around 4 times that amount in private investment on at least 2 of our preferred sites.

Over many years there has been a lot of public sector investment in Langley and the HMR programme, working alongside other partners, has really started to make a difference. The strategy for Langley has always been a slow burn one that envisaged a 15 year investment plan that would eventually become self funding. The strategy is at the point of development now but with the continuing uncertainty in the housing market we are unlikely to succeed without further financial support.

· East Central Rochdale

East Central Rochdale has been a priority Housing Market Renewal (HMR) Intervention Area over the last seven years and has benefited from over £20m of investment. This has assembled, cleared and de-risked a number of housing development sites, which were on the cusp of being made available to the market, with the potential of creating some 300 new homes. The Council and partners remain committed to achieving long lasting and wide ranging physical, social and economic improvements across the area with the ultimate aim of reducing deprivation and increasing individual choices.

East Central Rochdale falls within the bottom 5% of the IMD, with certain super output areas within the bottom 3%. The worklessness rate for the local authority area is 16.4% which is above the North West Regional average of 14.1%. Market failure has been recognized over a period of years with the designation of this area as a Housing Market Renewal intervention area. The cessation of the HMR programme has compromised the ability of the public and private sector to propose joint initiatives for housing led regeneration.

The community of East Central Rochdale suffers from high levels of deprivation, low levels of income and significant problems of overcrowding of the housing stock.

The regeneration of East Central Rochdale is a key component of Boroughwide policy as enshrined within the Sustainable Communities Strategy for Rochdale (formerly the Community Strategy), Rochdale Borough Renaissance Masterplan, Rochdale Economic Development Strategy and the emerging Core Strategy for land use planning across the Borough. It is also a key component of Rochdale and Oldham’s Joint Investment Plan – ‘Investing in jobs, homes and communities’ (Oldham and Rochdale Economic Skills Alliance 2010) which ties in to Greater Manchester’s strategic plans for economic growth in the city region. The Oldham & Rochdale Joint Investment Plan has been endorsed by the Homes and Communities Agency and was seen as a model of best practice for the Greater Manchester city region.

The regeneration of East Central Rochdale has followed a consistent and logical vision since the start of the HMR programme. The initial vision can be traced back to the East Central Rochdale Physical Regeneration Framework (PRF) which was commissioned in 2003 and was used to guide and shape the nature of HMR intervention in East Central Rochdale in the early years of the programme, which commenced in 2004/05.

The PRF recognised that the potential for large-scale housing clearance in the ECR was limited, and that sites yielded by such clearance would not result in a net increase of housing stock. In order to cater for the growing demand for houses (and particularly larger households), the PRF outlined a programme of fundamental structural change to land use patterns in the area, utilising sites that were in declining industrial or other employment use for new housing development. In this way it is anticipated that over 900 new homes could be created in the area. The PRF proposed unlocking sites in the River Roch Corridor previously occupied by low grade industrial uses and utilizing them for new residential development, which would remove existing amenity problems, open up the river to the residential community and maximize the development potential of the area.

Following an extensive procurement process, a developer partner was selected for this area. As part of their submission, they proposed a review of the PRF to ensure that it is a deliverable and viable masterplan and as such the East Central Rochdale Strategic Regeneration Framework (SRF) was prepared. In summary, the SRF reaffirms the relevance of the strategy being pursued and confirmed that the previous masterplanning work remained commercially viable and realistic. This includes the general thrust of acquiring the outmoded and marginal industries in the River Roch Corridor and developing new high quality residential schemes which provide increased access to the river.

The adoption of the East Central Rochdale Supplementary Planning Document (SPD) in May 2008 by Rochdale MBC has given a statutory legal status to the regeneration policy and principles for East Central Rochdale. The presence of the SPD also provides statutory support for any acquisitions that need to be pursued using Compulsory Purchase.

The key objectives for the ECR programme are defined within the SRF as:

· Assembling and developing sites close to inner areas

· Enabling communities to take advantage of modern new development nearby whilst still being able to remain near family and community facilities

· Redeveloping targeted social rented estates to provide additional homes and greater diversity

· Transforming land use patterns and the urban form replacing old low value and non-conforming industrial land with higher quality, mixed use sites close to town centres

· Making strong linkages with an improved Rochdale Town Centre and other improvements in the economy (Kingsway Business Park) which will in turn support Housing Market Renewal

· Aligning key services such as health and education to support Housing Market Renewal

HMR activity has been on going in East Central Rochdale for some six years and is showing positive results. These include:

· Construction of 25 new homes at Nelson Place (Trafalgar Street)

· A developer partner appointed for the Dean Street Housing Site

· Cleared and re-mediated sites available for development at Dale/Arkwright Mill and Gowers Street

· Cleared development sites at Nile Street, Kitchen Street and Belfield Road

· Acquisition and clearance of 16 commercial properties covering 2.91 hectares of land which is available for new housing development

· Acquisition and demolition of 117 houses

· Refurbishment of 796 houses

· Ongoing community support for and involvement in the programme of intervention

Given the position within the HMR programme, which was forecast to end in March 2011, there was a focus on the de risking of sites, the procurement of a development partner and construction of new build housing units up. Activities that were pursued in the last 12 months of the programme focussed on

· a limited acquisitions programme to meet existing commitments, to complete the assembly of developable sites or complete the acquisition of entire residential blocks were they have already been part purchased

· a de risking approach by way of remediation of sites to make them more attractive for future development

· the procurement of a development partner for a site at Dean Street which will deliver approximately 70 houses using the Homes and Community Agency Delivery Partner Panel (Northern Cluster). The implementation of this scheme will act as the catalyst to kick start the local market to deliver other schemes in the area, by demonstrating viability.

Evidence collected in the recently completed Rochdale Strategic Housing Market Assessment indicates a clear need to deliver additional housing. Future development would help to address the identified shortfalls and help encourage economic growth by providing a diversified housing offer in the borough and attract and retain economically active households through the provision of aspirational housing.

There are two main drivers in East Central Rochdale for the delivery of housing. These are;

Overcrowding – East Central Rochdale exhibits a need for larger properties to accommodate families currently occupying overcrowded properties – this is evidenced by the large number of terraces with one or two dormer extensions. There are strong links between overcrowding and poor living conditions, poor health and lower levels of educational attainment.

Aspirational Housing – to attract more economically active residents into the area, to increase the earning potential and when coupled with an improved Rochdale Town Centre to retain more of the income that is earned within the Borough.

The Housing Market Renewal programme to date has focused on site acquisition. As such, there are a number of sites that are now cleared, and in some cases remediated, which are available for development. A boroughwide Housing Development Sites prospectus is in preparation and includes the following sites in East Central Rochdale.

· Dale and Arkwright Mill, 1.8 ha site in mixed private and council ownership. Capacity 80 dwellings

· Gowers Street, 1.5 ha site in council ownership. Capacity 60 dwellings

· Nile Street, 2.0 ha site in council ownership. Capacity 70 dwellings

Others sites not included in the prospectus but which will deliver new housing units are

· Dean Street, 1.5 ha site in council ownership. Developer appointed. Capacity 70 dwellings.

· Kitchen Street, 0.25 hectares in council ownership. Housing Association to develop. Capacity 12 units

· Ramsey Street, Various infill sites total 0.4 hectares in council ownership. Capacity – 20 units

In total, if all of these sites were developed, approximately 300 new units would be developed.

In order to remove barriers to housing development and ultimately occupancy by local residents, targeted funding would be required in the following areas:

The Nile Street site is contaminated and costs estimates suggest that for around £400,000 this site could be remediated, making it more attractive for developers

Nile Street and Gowers Street are adjacent to the River Roch and the developable area would be increased by the construction of flood defence mechanisms. This is estimated at around £200,000

In order to stimulate the local housing market, equity products need to be made available to overcome the problem of poor local access to traditional methods of raising finance, as it will give more finance options for potential purchasers. This approach will then enable money to be recycled in the longer term whilst also enabling Rochdale MBC to access the "Homes Bonus" of enhanced council tax as a result of constructing new homes.

Applying a blanket 15% equity product per unit, this gives broad brush maximum investment figures of £4.6m to deliver the 230 units that are not already linked to specific developers. This would be over a period of some 5-7 years, given the necessary phasing of development to ensure that the market is able to accommodate the number of units being delivered.

In total, an investment of some £5.2m, the majority of which could be capable of being recycled would unlock private sector investment of around £30-35m over a period of the next 5-7 years

Second Wave Neighbourhoods

· Inner Rochdale

Inner Rochdale has been a priority Housing Market Renewal (HMR) Intervention Area over the last four years and has benefited from over £5,000,000 of investment.

The area is located immediately to the south of Rochdale Town Centre and a short distance to the west of Kingsway Business Park. It comprises mixed employment, housing and retail uses and is bisected by the Rochdale canal and the railway line. The housing in the area is dominated by terraces.

Oldham Road, a major arterial route into Rochdale town centre from the south, passes through the area. Rochdale Railway station is at the heart of the area and the new Metrolink stop (due to be in place by 2012) will be located outside the railway station.

HMR funding has been utilized to assemble a number of housing and mixed use development sites. These sites have the potential to deliver around 135 new homes. The Council and partners remain committed to achieving long lasting and wide ranging physical, social and economic improvements across the area. The regeneration of Inner Rochdale is a long term strategy which seeks to create a sustainable mixed community, making the area a better place to live and work, and creating a wider choice of housing and improving the economic future of the area. Within the wider Inner Rochdale area, a core area around the Oldham Road Corridor, the railway station and the Canal Basin, has been identified as an area where physical regeneration will be focussed.

The housing market in the area suffers from dysfunction, where there is a mismatch between available housing and householder aspirations. Housing in the area is dominated by terraces and the level of overcrowding is high (20% compared to 7% for Rochdale Borough as a whole). Baseline information and evidence in the area (including consultation with local residents) demonstrates the need for larger houses. There are problems in the area associated with litter, poor maintenance and a lack of quality open space / public realm, resulting in a poor image and appearance. In parts of the area industrial uses often sit inappropriately close to existing homes.

The regeneration of Inner Rochdale is a key component of Borough wide policy as enshrined within the Sustainable Communities Strategy for Rochdale (formerly the Community Strategy), Rochdale Borough Renaissance Masterplan, Rochdale Economic Development Strategy and the emerging Core Strategy for land use planning across the Borough. It is also a key component of Rochdale and Oldham’s Joint Investment Plan (ORESA) which ties in to Greater Manchester’s strategic plans for economic growth in the city region. The Oldham & Rochdale Joint Investment Plan has been endorsed by the Homes and Communities Agency and was seen as a model of best practice for the Greater Manchester city region. The regeneration of the Inner Rochdale area in a comprehensive and sustainable manner is therefore a key objective of the Council and its partners.

A Regeneration Investment Strategy for the area has been prepared, which provides the context to help deliver the regeneration of the Inner Rochdale area. The Regeneration Investment Strategy is a multi functional document which provides a framework for a holistic approach to the regeneration of the area to be progressed and identifies opportunities for new housing and employment developments.

In order to ensure a planning framework is in place to support the Regeneration Investment Strategy, a Supplementary Planning Document has been prepared. The SPD provides a ‘masterplan’ document for the area. The SPD identifies opportunities for new housing and commercial development to help achieve the regeneration of the wider area. The SPD has given a statutory legal status to the regeneration policy and principles for Inner Rochdale.

The key objectives for the Inner Rochdale programme are:

· increase housing choice for existing residents and attract new higher income residents to achieve a diverse and sustainable housing market;

· create affordable, attractive and high quality mixed tenure housing;

· create opportunities for modern employment sites

· improve open space, design quality and the public realm

· enhance key gateways and corridors

HMR activity has been on going in Inner Rochdale for around four years and has achieved a number of positive results. These include:

· Acquisition and clearance of a housing development site at Process Plastics (Norwich Street). This 1.57 hectare site has potential to provide around 65 new homes

· Acquisition and clearance of a housing development site at Isherwood Street and Durham Street. This 1.79 hectare site has potential to provide around 70 new homes

· Acquisition and clearance of a number of mixed use development sites along the Oldham Road frontage

· A comprehensive area improvements programme focussed on the Oldham Road corridor

· Refurbishment of around 300 houses

Given the position within the HMR programme, which was forecast to end in March 2011, the main focus was on completing the assembly of two large comprehensive housing sites (Process Plastics and Isherwood Street); the adoption of a Supplementary Planning Document to provide a planning framework for future development; and area improvements to help improve the appearance of the area in advance of new development.

Funding was not available during 2010/11 to remediate and de-risk the acquired sites in advance of development to make them more attractive for future development

Evidence collected in the recently completed Rochdale Strategic Housing Market Assessment indicates a clear need to deliver additional housing. Future housing development would help to address the identified shortfalls and help encourage economic growth by providing a diversified housing offer in the borough and attract and retain economically active households through the provision of aspirational housing.

Baseline information and evidence in the area (including consultation with local residents) demonstrates the need for larger houses. Housing in the area is dominated by terraces and the level of overcrowding is high. There are strong links between overcrowding and poor living conditions, poor health and lower levels of educational attainment.

The Housing Market Renewal programme to date has focused on site acquisition. As such, there are sites that are now cleared, but not remediated, which are available for development. A boroughwide Housing Development Sites prospectus is in preparation and includes the following sites in Inner Rochdale.

· Process Plastics (Norwich Street) - a 1.57 hectare site in Rochdale Council ownership with potential to provide around 65 new homes

· Isherwood Street and Durham Street - a 1.79 hectare site in Rochdale Council ownership with potential to provide around 70 new homes

In order to remove barriers to housing development and ultimately occupancy by local residents, targeted funding would be required in the following areas:

The Process Plastics and Isherwood Street / Durham Street sites are contaminated. Costs estimates suggest that for around £450,000 and £500,000 respectively these sites could be remediated, making them more attractive to a private sector developer.

In order to stimulate the local housing market, equity products need to be made available to overcome the problem of poor local access to traditional methods of raising finance, as it will give more finance options for potential purchasers. This approach will then enable money to be recycled in the longer term whilst also enabling Rochdale MBC to access the "Homes Bonus" of enhanced council tax as a result of constructing new homes. Applying a blanket 15% equity product per unit, this gives broad brush maximum investment figures of £2.7m to deliver the 135 units that are not already linked to specific developers. The release of these sites would need to be phased to ensure that the market is able to accommodate the number of units being delivered.

In total, an investment of some £3.65m, the majority of which could be capable of being recycled in support of regeneration, would secure the development of around 135 new homes and unlock private sector investment

· Kirkholt

Kirkholt is a predominantly council estate (managed by RMBC’s housing ALMO Rochdale Boroughwide Housing, RBH) with a population of approximately 12,000, housed in some 2,900 properties and is dominated by post 1930’s garden estate housing. Ethnically, the area is home to a mixed community but with a majority of people from a white British background.

Kirkholt Estate forms one of five priority regeneration areas for Rochdale Council across the Borough. The Council and partners are seeking to achieve long lasting and wide ranging physical, social and economic improvements across the area with the ultimate aim of reducing deprivation and increasing individual choices.

The area is one of the key Housing Market Renewal Intervention Areas and falls within the bottom 5% of the Index of Multiple Deprivation, with certain parts of the areas falling within the bottom 3%. The estate has been a priority Housing Market Renewal Intervention Area over the last 5 years (phase 2) and has benefited from over £6m of investment.

This has assembled, cleared and de-risked a number of housing development sites, which were on the cusp of being made available to the market, with the potential of creating some 650 new homes.

Under the development of new homes on the estate two sites are underway and have started on site while the third has an exclusivity agreement with a development partner.

The first development is for the construction of 6, 2 bed bungalows on the site of existing garages on Romney Avenue which is now on site with an estimated completion date of December 2011. This development is due for completion in mid 2012.

The second early win development is for 30 units on Curzon & Cumberland. This development is due for completion in mid 2012.

The third development site is the ex Queensway primary school site (Hartley Lane site). This site has been tendered through the HCA Northern Panel and a report seeking permission of exclusivity was approved by Cabinet in March 2011. It is expected that the site will yield 40 units with a start on site of in late 2011 and a 16 month development timeline.

It has been estimated that investment of around £2.6m over the next 3 years could unlock around 5 times that amount in private investment on at least 3 of our preferred sites.

The Main development site, the Hill Top development opportunity, comprises the school and adjacent RMBC training facility, both of which have been decommissioned and represents a significant development opportunity on the Southern edge of Kirkholt estate. The school and training facility buildings remain and are presently rented to a television production company but can be vacated on short notice. The site also includes substantial school playing fields and open space. The main site comprises approx. 8.01 ha (net available with buffer 5.6ha) with an indicative capacity of 224 dwellings. On development of this site the capital receipts would be reinvested to bring forward the other identified sites including the main shopping and community area of the estate.

This scheme will be delivered by the private sector. Its location and profile are such that it will have a significant impact on the local community, by way of being the largest housing new build scheme in the area within the last ten years and a demonstrable benefit of the Housing Market Renewal programme of site acquisition and remediation (de-risking).

The scheme itself will meet the needs of supporting the change of tenure on the estate by way of providing much needed private houses to this part of Rochdale.

Over many years there has been limited public sector investment in Kirkholt and the HMR programme, working alongside other partners, kick started the development opportunities. The development strategy for Kirkholt has always been a slow burn one that envisaged a 10 year investment plan that will eventually become self funding. The strategy is at the point of development now but with the continuing uncertainty in the housing market we are unlikely to succeed without further financial support.

Wider Regeneration Priorities

Employment & Training

The development of the various sites will directly create a number of jobs as either trade or apprenticeship positions. In addition RMBC will work both directly and through contractual clauses in the development for support from J21’s.

J21 is jointly funded by the two neighbouring boroughs (Oldham & Rochdale), offering comprehensive support to the local construction community and local residents seeking employment in construction. The aim has been to support and promote local contractors into the supply chain of National contractors working on major capital projects across the two boroughs, thus creating sustainable local employment.

April 2011