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London council considers setting up construction company
Southwark Council is considering setting up its own construction company as part of a new strategy to meet its ambition of delivering 11,000 new council homes by 2043.
According to the new strategy, which is set to be approved by the cabinet on Tuesday, the council is considering setting up a construction company “to create the homes and foster the skills our borough needs”.
The council said it believes the company would “be able to deliver better value, high quality and speed of delivery to [the council’s housing] programme”.
It is envisaged that the company would be a primary, though not exclusive, vehicle for delivering new homes in Southwark.
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The plans are part of a new strategy to ensure that Southwark Council meets its commitment of delivering 11,000 new council homes for social rent by 2043, of which at least 2,500 should be built or under construction by 2022.
Since first making the commitment in 2015, Southwark has delivered just over 670 new council homes, with a further 1,000 homes on site or with planning approved.
According to the strategy, the council still has to find land for at least 5,000 homes in order to meet its long-term target.
The council is therefore focused on identifying sites, including exploring opportunities for land redesignation and the intensification of existing estates.
In order to finance the 11,000 new homes, the council will prioritise any borrowing it undertakes for the delivery of new homes.
In addition to borrowing through the Public Works Loan Board (PWLB), the council is also considering options to “lever in private funding where it is equivalent or less than the value” of borrowing via the PWLB.
Latest data from City Hall shows that more social and London Affordable Rent homes were being built in Southwark than any other London borough. In the first half of 2019/20, 195 homes of these tenures started on site within the local authority.
