Backers of £200m housing regeneration scheme in east London apply to government for crucial gap funding
The stalled refurbishment of the Ocean housing estate in Stepney, east London, may have access to a new source of government funding, it emerged this week.
Gordon Brown’s Comprehensive Spending Review last month assigned £180m to regeneration schemes that had become bogged down. The backers of the £200m Ocean project are to apply to the ODPM for a chunk of this money.
The money would be used to tackle the problem of negative value stock transfers. This happens when the value of housing transferred to an association is outweighed by the amount that must be spent to refurbish it.
The news came as it emerged that PRP, the architect on the project, was drawing up a scaled-down masterplan for the site. This would reduce the number of blocks to be demolished from 25 to 14.
PRP was appointed in July last year with a brief to develop an existing masterplan produced by HTA Architects and EDAW.
PRP is liaising with Tower Hamlets council and Sanctuary Housing Association to produce a rigorous business case to present to the ODPM this month.
The new masterplan, which is still under consideration, has scope for 548 affordable homes and the refurbishment of 1031 dwellings.
The Ocean Estate team then intends to use private development across 40 blocks to provide further funding.
Ocean Estate Project insider
We've got to produce a business plan that satisfies the ODPM
A project insider said the scheme had to do three things: “We’ve got to produce a business plan that satisfies the ODPM, ensure the design is deliverable and then get people’s support.”
The scheme, one of the government’s New Deal for Communities regeneration projects, has £21m in NDC funding and £20m from the council, but needs gap funding of a similar amount to move forward.
The projects backers, which includes Ocean New Deal for Communities as well as the council and Sanctuary, worked out that they needed £55m in gap funding to deliver PRP’s previous masterplan.
The ODPM’s £180m fund is similar to the Estates Renewal Challenge Fund, which invested £487m between 1996 and 1998 on stock transfers.
Many observers believe the new fund needs to be more than £800m to be effective nationwide.
Niall McGowan, who heads the project for Tower Hamlets council, said any fresh public money would give the project a boost.
He said: “We welcome the opportunity to make the case for gap funding.”