Sadiq Khan faces housing rethink over retirement properties

Retirement - E+

London Mayor Sadiq Khan will this week be forced to rewrite part of his new affordable housing strategy after it was revealed that the country’s biggest retirement housing developers had stopped building in London because the conditions were so punitive.

McCarthy & Stone, Churchill Retirement Living, Pegasus Life and Renaissance Retirement had brought a case against the Mayor’s planning guidance at the end of 2017. They said imposing affordable housing requirements along with retirement homes for sale made their schemes financially ­unviable.

A judge ruled last week that part of the Mayor’s conditions was unlawful, and will this week take submissions from the developers to try to improve their terms. Under City Hall’s requirements for any new housing schemes, developers must be able to provide 35pc of the homes on the same site as “affordable” in order to qualify for fast-track planning permission. If they could not provide homes on the same site, they would need to provide 50pc affordable housing elsewhere. 

However, the developers argued it was difficult to provide affordable properties on the same site as homes for older people because retirement housing must be managed by one provider, putting them at a disadvantage.

The judge found that a clause allowing the Mayor’s office to conduct a “late stage review” into schemes to force them to build more homes at a later date was deemed to be unlawful.

Sadiq Khan will have to take his affordable housing plan back to the drawing board Credit: Reuters

Such was the scale of the problem with the policy that the four companies had all stopped buying land in London, squeezing any possible future supply of retirement homes. Mr Khan has previously committed to getting 4,000 homes for older people built in London each year.

Andrew Burgess, group land and planning director at Churchill Retirement Living, said the companies had “won the battle, not the war” and would continue to fight the planning guidance at hearings in November. 

“We’ve all stopped bringing developments forward in London,” he said. “The threat of a late stage review meant lenders were unwilling to fund schemes not knowing whether we would have to provide more affordable housing later.”