Saturday, 26 July 2008

Robbing Peter to pay Paul

Hackney's report to its Planning Committee on 24 July, concerning Hammerson's 51-storey Bishops Place scheme planned for Shoreditch, indicated that the Council would like to spend substantially more public money propping up Transport for London's private towerblock scheme at Dalston Junction.

Hammerson's Bishops Place scheme on land owned by Hackney Council. Hackney has already subsidised TfL's £39million concrete slab over the new Dalston Junction station by demolishing historic buildings and disposing of its flattened site for a peppercorn to the developer, Barratt. The lack of any affordable housing on TfL's site has been an embarassment to the authorities. Hackney hoped that Hammerson would sign up to planning agreements providing for a £14million payment towards "off site affordable housing". Hackney proposed to then take the money from Shoreditch to subsidise housing on TfL's Dalston site - robbing Peter to pay Paul. However the Planning Committee, which had convened for a special meeting, decided to defer consideration of Hammerson's Shoreditch application.

The Dalston developer, Barratt, has been in serious financial difficulties with the crash in development land values and house sales. Its recent renegotiation of covenants with its bankers has been described in the Financial Times as "lifting the coffin lid a fraction." Other house builders are reported to be in even worse financial trouble and there is talk in government circles of intervention if insolvent house builders abandon unfinished developments.

There is however no sign of Barratt pulling men off the Dalston Lane development site and leaving us with concrete stumps. But TfL have been reported recently to have expressed doubts about the use of the concrete slab for a bus turnaround above the new Dalston Junction station - the cost of which predetermined the whole logic of the Dalston towerblocks scheme. OPEN objections to the scheme included a concern that it was a "profligate use of financial and natural resources".

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