1.         that Cabinet notes that the existing total amount of capital grant funding received to support the project is £5 million, comprising £3 million from The Levelling Up Partnership and £2 million from The Devon and Torbay Devolution Deal, and notes that this grant funding will be used for both interim funding of schemes before Business Cases are finalised, and for part funding of completed schemes;

2.         that Cabinet approves the principle of the funding model for the Accommodation Repurposing Project, namely that each scheme is funded by a combination of Homes England grant, an appropriate level of supported prudential borrowing, with any residual funding requirement made up from monies already received from the Levelling-Up Partnership, the Devon and Torbay Devolution Deal (or any other relevant affordable housing subsidy available to Torbay Council at the time);

3.         that subject to Full Council approving the £20 million prudential borrowing, Cabinet approves the stated ambition to create an Accommodation Repurposing Programme that is able to deliver an average of 75 units per year and that Full Business Cases for each scheme be presented to Cabinet for approval in due course;

4.         that subject to Full Council approving the £20 million prudential borrowing, Cabinet provide delegated authority to the Director of Finance, in consultation with the Cabinet Member for Housing and Finance, to acquire sites for the Accommodation Repurposing Programme, ahead of Cabinet consideration of a Full Business Case (where necessary);

5.         that Cabinet requests that Head of Strategic Housing and Delivery prepare an annual report for consideration by the Overview and Scrutiny Board and Cabinet, demonstrating progress against the project; and

That Cabinet recommends to Council:

6.         that £20 million of prudential borrowing be approved to part fund individual schemes within the Accommodation Repurposing Programme, subject to repayment of borrowing being supported by rental income from the schemes after deduction of projected management and operating costs and appropriate allowances for future maintenance cost of the properties (taking account of any grant funding that may be available for the individual site).

The Housing Delivery Plan was created to bring forward opportunities over the next five years, both for direct Council housing delivery and housing delivery through partners.  One of the direct interventions identified was the Accommodation Repurposing Project, incorporating schemes designated under the title of ‘Hotels to Homes’.  This was designed to respond to Torbay’s characteristics of having large numbers of small urban brown-field sites many of which were unviable leisure and holiday accommodation such as former hotels, bed & breakfasts, and guest houses. Through this initiative, such properties would be purchased by the Council and converted into new homes.

In addition, the Government had asked all local authorities to accelerate house building throughout the United Kingdom.  An increase to delivery numbers in the Accommodation Repurposing Scheme would help Torbay towards meeting that requirement.  Furthermore, the Council intended to commit to this level of self-delivery through the emerging Torbay Local Plan, as a way of demonstrating how it would achieve its mandatory planning targets and kick-start the local construction sector.  With the Local Plan including this as part of the delivery trajectory for housing (and specifically affordable housing), it was necessary to ensure there was appropriate capital funding in place to meet this obligation.

Option 1 – do nothing.  This would result in under performance against Local Plan/MHCLG delivery numbers.

Option 2 – proceed with the formation of a Social Housing Delivery Programme and associated financing.  This would achieve all the objectives stated in this report and ensure delivery of a large capital housing programme of new homes for the benefit of households with a local connection to Torbay.

Option 3 – partial implementation.  This was an option however, the Council would be more susceptible to market fluctuations in borrowing costs and potentially be unable to upskill and increase capacity to a sufficient level, which would impact upon the Council’s ability to deliver.  It would also not signal the right level of commitment to the Registered Provider/private sector, which may hinder the Council’s ability to get longer-term buy-in or investment for wider growth.

The decision in respect of 1. to 5. will come into force and may be implemented on 23 May 2025 unless the call-in procedure is triggered (as set out in the Standing Orders in relation to Overview and Scrutiny).  The decision in respect of 6. will be considered at the Adjourned Annual Council meeting on 15 May 2025.

An increased and extended social housing grant programme has now been published by Government, with the funding now secure for Brampton Court (and greater understanding on the likely future requirements to secure grant in the coming years) it was now possible to progress decision making for a long term scheme.

A programme and funding proposal had been developed that could sustainably deliver a large number of homes on brownfield sites to help contribute to the requirements of the emerging Torbay Local Plan and the increased housing target that had been given to the Local Planning Authority. 

At the meeting Councillor Tyerman proposed and Councillor Chris Lewis seconded a motion that was agreed unanimously by the Cabinet, as set out above.

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