Acquisition of Land for Council House Building
North Ayrshire Council · 18 March 2025
Back to Cabinet — 18 March 2025 and its agenda
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NORTH AYRSHIRE COUNCIL 18 March 2025 Cabinet Title: Acquisition of Land for Council House Building Purpose: To seek Cabinet approval for the remainder of the former St. Michael’s Academy site in Kilwinning to be transferred from the General Fund to the Housing Revenue Account. Recommendation: That Cabinet approves the transfer of the former St. Michael’s Academy site from the General Fund to the Housing Revenue Account for the sum of £1,102,480, subject to deduction of abnormal costs. 1. Executive Summary 1.1 The Strategic Housing Investment Plan 2025-2030 was approved by Cabinet on 3 December 2024 and sets out the priorities for affordable housing investment in North Ayrshire over the next five years in order to support the outcomes set out within the Local Housing Strategy 2023-2028. 1.2 The shadow development programme includes the redevelopment of the remainder of the former St. Michael’s Academy site in Kilwinning (see plan at Appendix 1). 1.3 Additional grant funding of up to £2.000m has become available from the Scottish Government during the current financial year, arising from slippage in the delivery of other local authorities’ programmes. This provides an opportunity to accelerate North Ayrshire’s programme and utilise the available funding towards the acquisition cost for the remainder of the former St Michael’s Academy site. This will ensure that investment is maximised within the area and will release funding in future financial years to be utilised for other projects within the plan. 1.4 This report seeks Cabinet approval to transfer the land from the General Fund to the Housing Revenue Account for the sum of £1,102,480, subject to the deduction of abnormal development costs. The gross site valuation has been established through assessment by the District Valuer. 2. Background 2.1 The Scottish Government has confirmed that up to a further £2m slippage funding is available from their Affordable Housing Supply Programme (AHSP) to be spent during the 2024/2025 financial year. This funding is available in addition to the Council’s grant funding allocation for 2024/2025, which is £12.173m. 2.2 The funding is available as some of the other local authorities in Scotland are unable to spend their allocations by 31 March 2025. The funding is available on the condition that it
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is spent, and any transactions concluded, by 31 March 2025. 2.3 The Strategic Housing Investment Plan 2025-2030 sets out priorities for affordable housing investment in North Ayrshire over the next five years, in order to support the outcomes set out within the Local Housing Strategy. 2.4 When preparing the Strategic Housing Investment Plan, the Council and its Registered Social Landlord partners committed to delivering the projects detailed within it. However, the nature of development means that unexpected delays or constraints may emerge. Scottish Government guidance therefore indicates that a slippage programme is required. To meet this requirement, and in light of future AHSP funding uncertainty, the Council has prepared a shadow programme to be accelerated, subject to Cabinet approval, if and when additional funding becomes available. 2.5 As reported to Cabinet on 3 December 2024, should additional funding become available, the Council liaises with the Scottish Government to agree where this can be accommodated. The opportunities to accommodate the additional funding within the main programme have been exhausted, with additional funding anticipated to be claimed for the former Garnock Academy, Kilbirnie site, and the site at Ayrshire Central Hospital, Irvine. It is therefore proposed that the excess funding is utilised for the shadow programme. 2.6 The former St. Michael’s Academy site in Kilwinning was included for development within the Strategic Housing Investment Plan 2025-30 shadow programme. Projects within the shadow programme should be progressed to a ‘shovel ready’ status as far as possible to ensure that we are primed to take advantage of future funding availability. This includes land assembly for future development. 2.7 A valuation has been obtained from the District Valuer based on the full market value of the site. The gross valuation will be subject to the deduction of any abnormal costs agreed as part of the development project. The gross site market value is £1,102,480. The ground is held within the General Fund and there is no rental income for the site. The site extends to 3.12 acres and is expected to accommodate 46 units of new Council housing. The development is anticipated to provide a mixture of general needs houses, amenity bungalows and homes suitable for wheelchair users. 2.8 The site valuation includes an area of ground which is required to consolidate the title to the Council’s second phase development at the former St. Michael’s Academy site. This area is valued at £0.482m, and the acquisition of this land will therefore be funded from the Strategic Housing Investment Plan contingency fund. The remainder of the site is valued at £0.621m and will be funded by the additional Scottish Government grant. 2.9 The Council has appointed an external Quantity Surveyor to agree the abnormal development costs which will be deducted from the acquisition value for the site following internal review by the Council’s Quantity Surveyors. The consultant will also advise on the application of any cap on abnormal costs, if appropriate. This will ensure that the interests of both the General Fund and Housing Revenue Account are protected. 2.10 It is proposed that the land at the former St. Michael’s Academy in Kilwinning is transferred from the General Fund to the Housing Revenue Account at a cost of £1,102,480, subject to the deduction of abnormal costs, before 31 March 2025. 2.11 Subject to the availability of future Scottish Government grant funding, it is currently estimated that works at the site will commence during winter 2027 and conclude by spring
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2029. 3. Proposals 3.1 It is proposed that Cabinet approves the transfer of the remainder of the former St. Michael’s Academy site in Kilwinning from the General Fund to the Housing Revenue Account for the total sum of £1,102,480, subject to deduction of any abnormal development costs. 4. Implications/Socio-economic Duty Financial 4.1 The sum of £1,102,480 will be transferred from the Housing Revenue Account to the General Fund. Abnormal development costs will later be reclaimed from the General Fund, at an agreed cap or limited to the gross transfer value if a cap cannot be established. Human Resources 4.2 None Legal 4.3 There is a requirement to conclude the transfer of assets by 31 March 2025 to enable Scottish Government grant funding to be utilised. The development of the site falls within the Council’s permitted development rights. The site is located in a ‘General Urban Area’ classified zone within the current Local Development Plan (LDP2). Permitted development enables local authorities to carry out works, within their district, for the erection of dwellings so long as the development conforms with the Local Development Plan. The Council will obtain a ‘Certificate of Lawfulness’ from the Planning Service to certify that the site has been considered against the full terms of the adopted Local Development Plan. Equality/Socio-economic 4.4 The provision of new social housing will have a positive impact on those who require specialist accommodation, older people, those who are homeless, or at risk of homelessness, and those for whom purchasing a home is not an affordable option. The benefits of new build housing in relation to health, wellbeing and educational attainment, are well documented. Climate Change and Carbon 4.5 New homes should have a low environmental impact, with the aim of reducing fuel use and associated fuel costs. The project will be delivered in accordance with Building Standards regulations for energy efficiency. It will also be delivered to Section 7, Silver Level, of the 2019 Building Regulations in respect of Energy for Space Heating. New Council homes contribute significantly to the Council’s Sustainability agenda. New housing is more energy efficient, better ventilated, and has higher levels of thermal comfort, which supports improved health and well-being. Key Priorities
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4.6 The provision of new affordable housing supports the Council Plan strategic priorities: ‘Wellbeing’; ‘Climate Change’; ‘A Sustainable Council’: and ‘Communities and Local Democracy’. It supports the ambitions of the Council’s Regeneration Delivery Plan to drive forward development on strategic regeneration sites, including town centres. There is also evidence that children and young people can benefit from improved cognitive development and a reduction in behavioural issues through living in a more attractive, warmer, and better ventilated environment and the provision of new affordable housing also supports the Council Plan priority that children and young people experience the best start in life. Community Wealth Building 4.7 The development of the site supports the Council’s Regeneration Delivery Plan. The plan sets out the Council’s priorities to deliver on the Land and Assets pillar, objectives and associated actions of the Community Wealth Building Strategy. It aims to support equitable land development and the development of underutilised assets for community use. The delivery of the site will also contribute to the Procurement pillar through the inclusion of appropriate community benefit of local supplier clauses within the construction contract and by considering phasing and programming to support delivery by smaller scale and local contractors where appropriate. 5. Consultation 5.1 No consultations were required in the preparation of this report. DAVID W. HAMMOND Executive Director (Communities and Housing) For further information please contact Fiona Ellis, Senior Manager, Housing Strategy and Development, on 01294 324031. Background Papers Strategic Housing Investment Plan 2025-2030
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"This map is reproduced from the OS map by North Ayrshire Council with the permission of the Controller of Her Majesty's Stationery Office © Crown Copyright. Unauthorised reproduction infringes Crown Copyright and may lead to prosecution or civil proceedings. Licence Number :AC0000825715 " Ü 1:2,500 0 30 6015 Meters Site Area: 7.03 Acres or thereby St. Michael's Wynd LAURENCE CREE Head of Service/Chief Officer SUS, TPT & CORP PROPERTY CUNNINGHAME HOUSE, IRVINE, KA12 8EE TEL: (01294 22500 FAX (01294) 225044 NOTE: All ownership information should be checked against the relevant Legal Title. The boundaries shownareindicative only