Funding Boost for your Regeneration Projects

For the first time amid deepening delivery challenges Homes England will now provide grant funding for regeneration projects.

This is welcome news given the ongoing housing crisis and Homes England’s inability to meet build target for the 2016-21 affordable homes programme, despite extending it to March 23.

This Homes England initiative will no doubt facilitate more regeneration projects and help unlock stalled regeneration projects. It will be interesting to know whether the GLA will follow suit with this initiative as Greater London will benefit from this also.

We know that area regeneration can take many forms- including:

• Improving an existing area (residential and/or commercial centre)

• Remodelling/retrofitting of existing homes and/or demolition and redevelopment to provide additional homes

• Utilising brownfield land

• Public realm improvements

• New infrastructure

What this Homes England’s funding boost for regeneration projects does is to enable better and more housing provision in an economic climate which has virtually stifled new build developments.

Homes England have set out eligibility criteria for this funding, requiring qualifying schemes to:

1. Unlock net additional homes, alongside the replacement homes

2. Start on site by 31 March 2025

3. Complete by the relevant contractual longstop date

4. Minimise the amount of grant requested per home

5. Demonstrate certainty of delivery

6. Align with the priorities of the relevant housing authority

7. Align with the existing strategic objectives of the AHP

Items 1, 4 & 5 are critical, given the nature of regeneration projects. Airey Miller’s experience and expertise in delivering regeneration projects can benefit Local Authorities and Housing Associations looking to secure this regeneration grant funding.

Unlock net additional homes, alongside the replacement homes

Meeting this requirement and optimising the quantum of net additional homes is usually one of the key success criteria set for most area regeneration projects and perhaps one that typically underpins its viability and business case.

RPs will require additional input into the options appraisals and design development process to assist the design team in optimising value. At Airey Miller, we do this working collaboratively with the Architects, master-planners and the rest of the design team with input from our regeneration experts, design managers, cost consultants, in-house Fire Engineers and project managers.

Our approach has assisted various RPs in optimising densities, generating smart design solutions and improving commercial viability. For example, we supported Dover District Council in turning a commercially unviable 42-unit regeneration scheme into a 65-unit viable scheme which was delivered successfully within budget, and which went on to win the RICS 2021 Best South-East Residential Award.

Minimise the amount of grant requested per home

Minimising the amount of grant requested per home does not necessarily impose a cap of funding per home. Whilst funding amount per home will invariably be benchmarked by Homes England, what will be required is for adequate due diligence, design optimisation, robust procurement strategy and value optimisation initiatives to be applied to your regeneration schemes to demonstrate the cost as representing value for money and the requested grant as having been ‘minimised’.

We have assisted various Local Authorities and Housing Associations in implementing these initiatives in recent past and that puts us in a strong position to assist you with meeting this funding criteria.

It must be said however that given the long gestation period of regeneration projects, early start and good forward planning will be required to ensure success. This is even more important in meeting the grant funding criterion for a start on site by March 2025!

Demonstrate certainty of delivery

This can be a challenge for regeneration projects given the complexities of balancing multiple requirements such as, resident engagement, decant, residents’ concerns (e.g., car parking), phasing, access, construction logistics, Health & Safety, etc.

Where balloting is required, this can also pose significant challenges to delivery.

The key message here is to allow adequate time for all the front-end activities which are as important as the actual delivery. By planning adequately for the pre-delivery and the actual delivery, these challenges can be overcome, but RPs will need the support of an experienced team of cost consultants, design managers, regeneration & technical advisers.

Various Local Authorities are currently benefitting from our expertise and our experience in this area – including LB of Enfield & LB of Waltham Forest.

We suspect that the ability of RPs to convincingly demonstrate certainty of delivery is one that may be the most challenging for them, but we can help.

Get in touch…

Kunle Awofeso, Director - Kunle.awofeso@aireymiller.com

Kieran Vincent, Director - Kieran.vincent@aireymiller.com

Ed Richards, Partner - Edward.richards@aireymiller.com