Social Housing Regeneration – Stage One: Feasibility (Nuneaton and Bedworth Borough Council)

Exploring how improving the built environment can help address inequalities in an area of high deprivation.


At a glance

What went in

Priority area addressed: Poor housing design, high levels of deprivation, poor education attainment, poor health and high levels of crime and anti-social behaviour (ASB). 

Resources:

- Approximately 150 hrs of staff time 

- Key Stakeholders included 

  • Housing Portfolio Holder 
  • Both Executive Directors 
  • Director, Regeneration and Housing 
  • Development Project Officer deputising for the Head of Development 
  • Head of Strategic Housing 
  • Head of Financial Services, Finance and Procurement 
  • Principal Planning Policy Officer 
  • Open Spaces Officer, Parks and Recreation 

Partners: 

County Council 
Community Police 
Homes England  

Consultancy Service Thought RG+P included: 
Architects/Urban Designers, Senior Quantity Surveyor 

Timetable: 

Acquiring in-house experience and knowledge in all aspects of the feasibility was accomplished in phase one.  

Delivery of energy efficient, healthy and fit for the future homes will be in Phase Two/Three Procurement (Employer’s Requirements) and Construction (Ensuring quality management assurance and conformity throughout he build).  

Increasing the number of people from the local community accessing training and employment as a direct result of the project will be in phase four after occupation takes place.

What came out

Deliverables: 

Phase one: A feasibility and viability report and the in-house experience and knowledge gained during the course of the phase one process.  

Differences Made/Indicators of Success 

- We have a better understanding and knowledge of the complexities associated with regeneration as well as the economic costs.

- This has allowed decision makers to build a clearer picture on short, medium and long-term expenditures to understand what is possible within the broader context of HRA spend pressures. 

- We are now in a position to explore a phased regeneration approach and to seek out additional funding options 

“The purpose of project was to understand the art of what is possible, which I believe was achieved. We now have a good foundation to move forward to the next stages with the knowledge and experience gained from a very professional team of consultants”.

Dawn Dawson, Director of Regeneration and Housing 

 

Executive summary

One of Nuneaton and Bedworth Borough Council (NBBC)’s pillars of conscience is to improve the quality of life and social justice for residents so that it is closer to that enjoyed by the rest of Warwickshire. 

The proposed regeneration site is in a ward that is statistically one of most deprived areas within the borough for several reasons: low income, poor educational attainment, and poor health. Exacerbating these inequalities are poorly designed homes and built environment giving rise to high levels of crime and anti-social behaviour. Regenerating this area is anticipated to help address these inequalities and behaviours by supporting and enhancing access to improved and affordable housing, improved health, and training and employment opportunities.  

Phase one of the feasibility study was carried out by consultants RG+P working alongside an in-house team who gained experience and knowledge throughout the process. The project team adopted a collaborative approach, helped by experienced and knowledgeable consultants from RG+P who were trusted and engaged with the right stakeholders at the right time. This was key to the success of the project.  

One question that has not been fully answered yet is “can the site be regenerated within budget limit?”. Whilst the feasibility study concentrated on design and economics, quantifying the social value to the project fell outside its scope. In the next steps a cost benefit analysis is planned alongside a construction phasing exercise to evidence added value and to profile the spread of future costs.  

The regeneration project should not be looked at in isolation. A broader picture of the known HRA spend pressures will help to understand whether the project can be delivered within budget limits set by the levels of funding which are available. 

Challenge and context

The socio-economic profile of Nuneaton is less prosperous than the rest of Warwickshire. At £25,150, average household income is lower than the West Midlands region (£26,710) and the UK (26,500). The town has six Lower Super Output Areas in the 10 per cent most deprived nationally.

There is significant variation between the wards Abbey, Barpool, Camp Hill, Kingswood and Wembrook and the rest of the Borough. All five Wards demonstrate high levels of deprivation reflecting high levels of inter-generational poverty after the decline of traditional industries. These wards are associated with higher levels of child poverty, crime and unemployment compared to county and national averages, with a high proportion of the working population having no qualifications. In addition, Abbey Ward together with Wembrook and Barpool host the highest proportion of “Priority Families” in the Borough - 61% of the total number of local families in this category. 

Inequalities are prevalent across these areas and in one particular ward they are exacerbated by poorly designed homes and a general built environment that has given rise to higher levels of crime and anti-social behaviour. 

Regenerating this area is anticipated to help address these inequalities by supporting and enhancing access to improved and affordable housing, improved health and training, and employment opportunities.  

The regeneration sites under consideration measure approximately 2.5 hectares, are relatively close to one another and comprise mainly of three residential areas belonging to NBBC. All are general purpose stock consisting largely of one and two-bedroom flats.

 

Property Type 

Number of Units 

1 BED G.P.FLAT:FIRST FLOOR 

30 

1 BED G.P.FLAT:GROUND FLOOR 

37 

1 BED G.P.FLAT:SECOND FLOOR 

26 

1 BED G.P.FLAT:THIRD FLOOR 

22 

2 BED G.P. FLAT:FIRST FLOOR 

2 BED G.P. FLAT:SECOND FLOOR 

2 BED HOUSE 

13 

2 BED MAISONETTE:FIRST FLOOR 

24 

2 BED MAISONETTE:SECOND FLOOR 

GENERAL PURPOSE FLATLET:FIRST FLOOR 

GENERAL PURPOSE FLATLET:GROUND FLOOR 

37 

Grand Total  

209 

 

Project Objective 

The key objectives for the regeneration project are to: 

  • Improve the quality of life for the local community. 

  • Provide high quality, affordable homes for our most vulnerable residents who are currently in accommodation which is not of good design. 

  • Deliver a regeneration scheme that improves the built environment with a process that delivers opportunities for training and employment to the local community. 

  • Diversify the tenure mix to create a more sustainable community.   

  • Develop a detailed understanding of the housing led regeneration process and harness that knowledge to allow our in-house team to manage that process in its entirety. 

Project Outcomes 

The project outcomes will be measured as follows: 

  • Measurement of the number of members of the local community accessing training and or employment as a direct result of the project. 

  • Use of current design standards to ensure energy efficient, healthy and fit for the future properties are delivered. 

  • Develop an in-house team that is fully experienced in all aspects of feasibility, including formulating the scope, procurement, undertaking the study and assessment of financial information. 

Consultant’s Brief – Phase One - Feasibility Study 

The first step towards the delivery of the regeneration project was to produce a feasibility study which will address the following questions: 

  • Is the regeneration of the site a viable option? 

  • Will the regeneration of the site achieve the project objectives identified above? 

  • Can the site be regenerated within budget limits set by the levels of funding which are available? 

What we did

Engaging consultants 

A client brief for consultancy services was written in-house. RG+P who have offices in London, Birmingham and Leicester were awarded the contract. Directors Robert Woolston and Mitch Dale were NBBC’s main contacts and the led the process.    

Project Management 

Dawn Dawson, Director of Regeneration and Housing was the project lead from NBBC and Robert Woolston, Director of RG+P was the project lead from RG+P. Having a collaborative approach helped to build a trusting relationship. This was very important as NBBC as the client had the vision and RG+P as the consultant helped to bring it to fruition 

Kick start meeting June 2020

  • Reviewed the brief to ensure everyone was “on the same page” 

  • Roles and responsibilities were understood 

  • Review of the options took place – do nothing, do what was needed to keep the existing stock functioning and a full regeneration scheme 

  • A programme was set up with key milestones to achieve 

  • Information request schedules were set up  

  • Regular workshops on “Teams” were setup

Project team meetings/workshops

  • Minutes, actions and information request schedules help to keep the process on track. 

  • Different stakeholder came into the process as the designs began to progress i.e. planner, parks and leisure, finance. 

  • Searches were split between RG+P and NBBC – who was best placed e.g. Title deeds NBBC – drainage surveys RG+P  

  • The process was information hungry and each department had a part to play 

  • Scheme, models and costs came together – a very iterative process 

Final review December 2020

  • Feasibility study including viability report completed and issued in December 2020 

  • Reviewed after fine-tuning-with comments  

  • Re-issued 

Fundamentally, ensuring the full scope of the exercise was understood by both parties from the start helped to mitigate any misunderstandings during or on completion. Outlining the next steps and how the project was going to be achieved set the scene and inspired confidence that the feasibility study would be delivered on time. In addition, RG+P’s lead consultant acted as chairperson for the process which was key in driving the process forward and engaging all stakeholders. Accurate minutes were produced on the same day, together with the request for information schedule which helped keep actions on track and completion within agreed timescales.  

Design Concept 

NBBC’s vision was for the regeneration proposals to create a sociable place, where people feel happy and proud to live. RG+P’s interpretation of that vision is shown in the picture below. This shows the Recreation Ground which will be transformed into a green asset benefitting the community, with the green spine connecting the community from north to south.  

Collaboration featured extensively in all aspects of the project. Workshops (albeit it on Microsoft Teams due to the COVID-19 pandemic) were beneficial as was the use of Google Earth. In normal circumstances site visits would have given a better scale of the changes being proposed. The process was iterative in nature starting from an initial concept that led on through a sequence of workshops building upon the former. At each stage comments from different stakeholders that produced a gradual process of refinement. 

Several overarching themes and objectives emerged from this process which are summarised below:   

 

1. Creation of a “green spine” to connect recreation grounds with regeneration sites. 

2. More pedestrian friendly links across the development and beyond 

3. Defining the edge of the recreation ground with the new development – providing material surveillance over the park and an attractive outlook for residents 

4. Greening of streets more generally with landscaping and trees incorporated into the proposal wherever possible and use of ‘shared surfaces’.  

5. Retention and improvement of connections to the parks and wider community.  

6. Creating well defined streets with a mix of houses and small apartments arranged in perimeter blocks. 

7. Introducing ‘landmark’ buildings creating gateways shopping areas.  

The Master Plan 

The Master Plan has evolved from an initial idea that sought to re-introduce ‘streets and spaces’ into an area that has had its original Victorian character eroded by post-war development. It proposes the removal of outdated apartment blocks and the reintroduction of a broader mix of house types and varied apartments to suit a wide range of accommodation needs identified by NBBC. 

Social streets are the building blocks of the Master Plan and these are created by arranging houses and apartments to define streets and enclose private spaces such as gardens and rear courtyards. By introducing more dwellings and smaller apartments that all have individual entrances onto the street, a greater sense of community can be created through stewardship of the public realm and a more neighbourly outlook. This arrangement also allows more opportunities for ‘eyes on the street’, helping to reduce crime and anti-social behaviour.

One of the major interventions of the masterplan is to provide much better definition and enclosure of the Recreation Ground. This will be achieved with houses and apartments, most of which will be 2-3 storeys in height. A range of different types will be used to  create this edge and respond to their context.  

House Type Design 

There were lots of interesting discussions around house designs. NBBC wanted a consistent house design to use across the whole regeneration area. The intention is that all house types will share some of the same characteristics.  However, they will not be identical as it was felt a mixed approach to the typologies is beneficial in providing a wide range of accommodation types to suit residents at different life stages.  

The houses will: 

  • Be vertically organised, with a first floor living room to reduce impact of street noise and utilise a roof terrace over the integral garages.  

  • Have reduced gardens, supplemented in some cases with roof terraces. 

  • Have internal car parking to reduce the impact of parking on the street scene. 

The house types are combined to create strong visually appealing groupings which contribute to the wider place making agenda and individual character of the streets. 

One of NBBC’s objectives was to ensure the new homes would be energy efficient above current building regulations to keep in step with the climate change agenda of becoming carbon neutral by 2030. These measures will also help toward addressing fuel poverty. National space standards were agreed and aligned with Homes England preferred unit sizes.

The Mix of Homes 

In November 2013, a Strategic Housing Market Assessment (SHMA) was published. The SHMA states a range of type and size of housing is needed to redress imbalances of specific types and sizes, to meet the needs of the changing household structures and to meet the aspirations for the Borough’s economy. This research helped to inform the Council’s Affordable Housing and Range and Mix paper produced in 2015 that would inform developments in the Borough throughout the future.  

The Joint SHMA 2013 recognises that there are a range of factors influencing the demand for different sizes of homes. This includes demographic changes, future growth in real earnings and a household’s ability to save, economic performance and housing affordability. It also analyses a range of factors, including long term demographic trends to provide guidance on the future mix of market housing. 

For NBBC the modelling of long-term social housing needs indicates in particular a comparatively higher need for one-bed properties relative to other areas. However, provision of larger homes can have benefits in managing the housing stock; and one-bed properties may be unpopular. Based on the evidence they recommended the following strategic mix of affordable housing:  

  • 1-bed properties: 40-45%  

  • 2-bed properties: 25-30%  

  • 3-bed properties: 20-25%  

  • 4+ bed properties: 5-10% 

This information was used as a basis to create the following mix of new homes in the proposed regeneration area considering specific localised housing needs as well.

Type 

Numbers 

Percentage by bed space 

1 Bed Bungalow 

(1%) 

1 bed flat 

74 

(30%) 

1 Bedroom Type total  

77 

31% 

2 Bed Bungalow 

(3%) 

2 Bed Flat 

31 

(13%) 

2 Bed House 

46 

(19%) 

2 Bedroom Type Total 

84 

34% 

3 Bed House 

61 

(25%) 

3 Bedroom Type Total 

61 

25% 

4 Bed House 

23 

(9%) 

4 Bed Type Total 

23 

9% 

Total Numbers of Dwellings 

245 

100% 

 

Viability Report 

Two options were considered: 

  1. Do nothing – requiring Whole Life Costs (WLC) of the existing assets. 

  2. Regeneration of the existing assets – requiring WLC of the proposed new assets. 

Information gathering for NBBC was the main activity, which included identifying: 

  • Rent levels 

  • Occupation levels 

  • Number of Leaseholder 

  • General Fund land acquisition costs 

  • Revenue repair costs 

  • Management costs 

  • Overhead costs  

  • Others 

RG+P adhered to a recognised methodology to work out WLC. BCIS cost date and other sources were used. In addition, the Building Research Establishment (BRE) component life expectancies for major element renewal were incorporated into the costings.  

Essentially, baseline information for the existing stock projected over a 60-year period to work out total costs of the asset against total income was compared to the proposed regeneration scheme.  

Results 

The existing assets of NBBC are 209 compared to 245 potential new assets within the proposed regeneration – a net gain of 36 homes. Whilst this is not considered a significant increase in units, full occupancy of the regeneration scheme will accommodate 933 residents. Compared to the 443 people housed in the existing scheme this is a significant increase in accommodation. 

Costs 

The proposed regeneration scheme with full social rent identified a marginal negative return of -1.51% as opposed to the negative return of the existing asset of circa -2.78%.  

Two further options were reviewed that included. 

  1. Disposal of some units through outright sales or  

  2. Letting the additional units at local housing allowance (LHA) level less 20%.  

Option 1 produced a marginal negative return of -1.08% and improved upon the full social rent return by 0.43%. 

Option 2 produced a positive return of 2.62%.  

The difference we made

One of the key outcomes for NBBC was for our in-house team to be fully experienced in all aspects of a regeneration feasibility study. The process NBBC went through, supported by very experienced and knowledgeable consultants who were engaging and structured in their approach, and who helped to create a trusting environment, helped to deliver that outcome.  

Longer-term outcomes will hopefully include:  

  1. Delivery of energy efficient, healthy and fit for the future homes in Phase Two/Three Procurement (Employer’s Requirements) and Construction (Ensuring quality management assurance and conformity throughout he build).  

  2. Increasing the number of the local community accessing training and employment as a direct result of the project in phase four after occupation takes place.  

What's next?

The feasibility and the viability reports are both considered as a starting point.  

More work is needed to understand how the regeneration proposal can be made more viable. Cost Benefit analysis is considered one means to do this by placing a value on the social benefits over the term.  

It has been documented that changing rent level can make a positive impact on the regeneration’s viability. There is scope to charge affordable rents6. However, a balance needs to be struck between what level of affordable rent to charge and what can be afforded. Therefore, additional options are under review on profiling different affordable rent levels and comparing them with LHA levels across all house types. 

The HRA spend pressures have huge potential to affect if, when or how the proposed the regeneration of this area can take place. These are known spend pressures, what about the unknown spend pressures of the future?  

Part of the feasibility appraisal must incorporate horizon gazing and form part of a continuous reviewing process. In addition, assessment of a staged construction regeneration plan will form part of the final decision-making procedure to move forward. This will help in projecting costs in “bite size” expenditure so not to commit too much too quickly and in so doing helping to build in unknown spend pressure resilience.  

There are several other areas under review which would benefit from regeneration. Again, the first phase will be to procure a similar feasibility study and building upon some of the lessons learned. 

Lessons learned

The regeneration project should not be looked at in isolation. A broader picture of the known HRA spend pressures will help to understand whether the project can be delivered within budget limits set by the levels of funding which are available. 

Under different circumstances site visits would have been of real benefit to give a better sense of scale of the changes being proposed.  

Rent levels used in the viability report were based on estimations. Once the house types had been developed valuations could have been determined and a more actual social rent level calculated, which is suggested to be slightly higher than the estimated. Consequently, a clearer viability picture would have been produced sooner. 

Political and Executive level support from the beginning was important in establishing the project’s priority. It helped in resourcing the scheme adequately and in removing any barriers.  Director level decision making helped to set expectation levels and by having a broader knowledge and understanding of what was happening in the wider context in terms of the Town Centre regeneration was informative to the whole process.   

Contact

Mathew Byrne, Head of Development mathew.byrne@nuneatonandbedworth.gov.uk