Pollard Thomas Edwards and Jerram Falkus Construction have designed and built the development for the London Borough of Barking and Dagenham and developer, Explore Investments, a Laing O’Rourke Company. Thames View East is a 100% affordable homes scheme of 151 family houses, 35 duplex flats and 90 one and two bedroom flats.
High-quality traditional homes have transformed the estate’s typography, with the original 1950s nine-storey tower blocks and poor quality low-rise stock now demolished. The Council will nominate and manage all the tenancies, and all the homes have let very easily – the majority to existing local people previously housed in unsatisfactory conditions.
The long-term investment model that funded Thames View East was devised by asset management specialist Long Harbour. Under this model the Council has granted a lease over their land for a fixed period to a private joint-venture funder. The joint venture body has financed the construction of the scheme and will cover all lifecycle and maintenance costs in return for a regular income derived from rental receipts.
The Council retains the freehold interest in the land, and will receive ownership of the properties (at no extra cost) at the end of the investment period. Meanwhile Barking & Dagenham can alleviate the burden on their housing lists by allowing aspiring families to move into these properties, paying intermediate rents for new, high quality homes. Management of the stock remains with Barking & Dagenham on a fully funded basis. By creating a ring-fenced corporate entity, right-to-buy legislation does not apply and the local authority retains control over their housing stock.
The scheme is predominantly composed of family houses, entered at ground level with active frontages and private back gardens. To meet the cost and programme objectives of the project, a carefully limited range of townhouse types was developed, with variety achieved through subtle variations in plan, roof-form and window arrangements. For example, first floor living rooms are located at the front or rear of the house according to orientation. Oriel windows mark the corner houses and alternate along the terraces to provide enhanced space, light and view.
The houses are complemented by five detached apartment blocks, which create the main public frontage to Renwick Road. The ground and first floors contain duplexes with private gardens, which include homes suitable for disabled residents. The combination of houses and maisonettes also fits the flood risk strategy, which prohibits bedrooms at ground level. Roughly half the homes are corner units, which enjoy exceptionally generous and well-lit common areas.
Each block is distinguished by a unique colour scheme and artwork. Space for refuse, bicycles and plant is all integrated within the building, avoiding the need for external stores and shelters.
Pollard Thomas Edwards’ Executive Director, Andrew Beharrell said: “These are great homes, and in a climate where rising land values and diminishing grant make it very difficult for lower income households to find homes in London, the fact that the scheme is 100% affordable is impressive. What makes it exceptional is that this social good is the outcome of a novel investment scheme, which harnesses international interest in London as a force to provide homes for ordinary Londoners. With the final homes complete in April 2014, the financial model behind the redevelopment will begin to prove its worth.”
Thames View East has also taken the first steps towards meeting Barking and Dagenham’s future energy goals of creating a borough-wide heating system with the inclusion of an energy centre on site. This will provide district heating for the whole estate. The new homes will also reach Level 4 of the Code for Sustainable Homes.
Developed by Long Harbour in association with a funding partner, the novel, long-term investment fund is a secure, asset-based finance model based on the particular qualities of social rented housing.
Barking and Dagenham local authority allowed housing to be built on land that it owns, which was supplied cleared of existing tenants and structures. The investor will take the rent as income until the build costs, plus a modest return, is repaid. At this point, ownership of the houses will be transferred to the Baking and Dagenham. In effect this means that, after roughly 40 years, Thames View East and the buildings on it will again belong to the local authority, although it will have provided social housing throughout the life of the scheme.
Social housing provides a virtually guaranteed rent, with practically no vacant properties. It is highly unlikely for a local authority to become insolvent so it is constitutes a very secure investment.
The homes will be rented out and managed by Barking and Dagenham Reside, a new housing company set up by Barking and Dagenham Council. They will be rented out at a mixture of 50%, 65% and the majority at 80% of market rent. These will only be available to people in employment whose earnings are in a pre-determined salary range, helping people who cannot afford to get on the housing ladder, but also find it hard to get a council home.
In practice, this innovative method of funding social housing provides a long-term investment opportunity with exceptional security, offering a moderate return that can be accurately estimated. This finance model appeals to investors with wealth that needs to be secured for the long term, for example pension funds or private equity firms.