Back to basics: a reminder on viability appeals
By Roy Pinnock
We have previously noted the outcome of the viability appeals beginning to trickle through under the new section 106BA/BC provisions as part of the Growth and Infrastructure Act 2013 regime for speeding up planning decisions and delivery. In a recent Inspectorate decision, at Manor Road, South Norwood, the inspector dealing with the section 106BC appeal refused to accept that a commuted sum for affordable housing should be reduced. It is a reminder to get the basics right in an appeal on viability grounds and where the burden of proof lies.
The scheme was intended to be 100 per cent affordable and it was agreed with the LPA that 50 per cent had become the viable level of on-site provision and, furthermore, that it would be not be feasible (for non-financial reasons) to deliver the scheme as a 50/50 affordable/private sale development. The commuted sum in the section 106 agreement therefore kicked in and the appeal was made in relation to the council’s refusal to accept that the amount could not be afforded.
In addition to disputed construction costs, a key issue was the benchmark land value to be used as a development cost. Like the Holsworthy Showground appeal, the Manor Road decision confirms that price paid will not be accepted as a development cost where it represents an excessive bid against existing use value (EUV) (i.e. where it includes hope value associated with future redevelopment). The developer sought a 25 per cent uplift in land value above EUV but this threshold was not accepted and the council’s 20 per cent value was adopted. As a result, the appraisals confirmed that a commuted sum was still achievable…
Click on the link below to read the rest of the Dentons briefing.
Sign in or Register to continue reading this article
It's quick, easy and free!
It takes just 5 minutes to register. Answer a few simple questions and once completed you’ll have instant access.Register now
Why register to The Lawyer
In-depth, expert analysis into the stories behind the headlines from our leading team of journalists.
Identify the major players and business opportunities within a particular region through our series of free, special reports.
Receive your pick of The Lawyer's daily and weekly email newsletters, tailored by practice area, region and job function.
More relevant to you
To continue providing the best analysis, insight and news across the legal market we are collecting some information about who you are, what you do and where you work to improve The Lawyer and make it more relevant to you.
News from The Lawyer
Analysis from The Lawyer
Life in Canada is getting harder for firms as commodities prices fall and work volumes slow
Which firms are cutting it in this era of slimline rosters, and who are the GC new brooms making clean sweeps? The Lawyer can reveal all