Friday 13 January 2023

Brent’s Wembley Housing Zone contract award – still too many secrets!


Guest post by Philip Grant in a personal capacity


In a guest post last month (‘Tis the Season to be Sneaky!) I suggested that Brent Council might be trying to use its “urgency procedures” to get the decision to award a major contract for its Wembley Housing Zone (“WHZ”) development slipped through over the Christmas / New Year period, in the hope of avoiding it being called-in for scrutiny.


Although the decision was scheduled to be made on 19 December, it wasn’t officially made, by Brent’s Chief Executive, until 10 January, and published on the Council’s website the following afternoon. Normally, 28 days clear notice of a Key Decision has to be given, but the Urgent Key Decision Form sent to a Scrutiny Committee Chair on 12 December said that was not possible. Yet the decision was made 29 days after “urgency” was claimed!


Part of the Evaluation Process section from the Officer Key Decision Report.


In fact, notice of a Key Decision for this contract could have been given at least several months before 12 December. The Officer Report (undated), on which the decision to award the contract was based, says that the tender process started on 30 April 2022, when the Council advertised for initial expressions of interest from contractors. Eight had provided the necessary responses by the closing date of 31 May. The four short-listed contractors were invited, on 3 July, to submit tenders, and three had submitted valid tenders by the closing date of 18 October.


The Recommendation from the Officer Key Decision Report.


After all of the evaluation of the tenders by Council Officers, the recommendation which Brent’s Chief Executive accepted was to award the “developer partner” contract to Wates Construction Ltd, for a price of £121,862,500. That is a lot of money! In fact, the report shows that it could be even more than that, perhaps as much as £133m (and that is after an estimated £4m already having been spent on architects’ fees).


Extract from the Financial section of the Officer Key Decision Report.


It appears that the £126.5m will be the cost of building 304 homes on two sites which Brent Council already owns. That is a building cost of around £416,000 per unit. As para. 4.2 in the Report extract above states, part of this will be funded through capital receipts from the sale of private homes. When Cabinet agreed this scheme in August 2021, it included allowing the development partner to have half the homes (152, and all on the more favourable Cecil Avenue site, which will be completed first) to sell privately, for profit. How much will Wates be paying Brent for those homes as part of the contract deal? We don’t know – it’s a secret!


Part of the funding will also come from the ‘capital receipts from … intermediate homes’. In plain English that means the sale of percentages in shared ownership flats within the 152 homes that the Council will own. In August 2021, Cabinet agreed that 61 of the 98 homes which Brent would retain on the Cecil Avenue site should be “intermediate”, with only 37 of them for London Affordable Rent. Following the November 2022 Cabinet meeting, will the figure of shared ownership be increased?  We don’t know – it’s a secret!


Wembley Housing Zone extract from the “Affordable Housing” report to Cabinet, 14 November 2022.


Martin published a guest blog I had written about that Affordable Housing report to the November 2022 Cabinet meeting, and another which I wrote following the Council Leader’s response to questions which Cllr. Anton Georgiou had asked at that meeting. I showed that there is already a surplus in shared ownership homes on offer in Brent, which is likely to continue and increase, and that shared ownership is not really affordable to most people in housing need in Brent. So why is the Council planning to make many of the WHZ homes shared ownership, which won’t help the people its affordable homes policy is meant to house?


Outline of the contract from the Officer Key Decision Report.


The contract, as shown by the extract above, is in several parts. This is because although both WHZ sites were given planning permission in February 2021, Ujima House only has outline permission. Because of the long delay in getting to the contract award stage (which has greatly increased the cost of the project), the “developer partner” has to prepare, submit and get approval for the actual Ujima House plans. That’s why there is a completion date of 31 December 2026 (nearly 4 years away!), with a possible extension, for those homes to be delivered.


The former office block at Ujima House still has some “meanwhile” occupants, including the thriving Stonebridge Boxing Club, a vital resource for the local community. They have still to find an alternative home. Despite the long lead time before any work at Ujima House can begin (apart from its possible demolition, leaving an empty site, like that of the former Copland School buildings, where work on the Cecil Avenue homes could start straight away), Brent Council wants to ‘seek to assist them in finding suitable alternative premises’ (evict them a.s.a.p.). 


Extract from the Equality Implications section of the Officer Key Decision Report.


The Report’s determination ‘to ensure a start on site by the end of March 2023’ must mean that the extra £5m funding the Council has obtained from the GLA comes from its 2016-2021 (but extended to 2023) Affordable Housing Programme. There is probably some “spare” money in that pot because Brent will fail to start some of its other New Council Homes projects before the 31 March deadline! The £5m looks like the grant for 50 London Affordable Rent homes, at £100k per home. The Cabinet’s August 2021 decision (possibly since watered down) was for all 54 homes at Ujima House to be for LAR, but only 37 at the Cecil Avenue site, so at least some of the latest GLA agreement must relate to Ujima House.


One final point. The documents published with the decision notice include the Council’s Tender Evaluation Grid, where Wates appear as contractor “C” (the identities of “A” and “B” are secret). Although “C” scored highest overall, because their Financial score was much better than the other two (meaning their price was lowest), they were only second in the Quality section. Their Quality score was 68.6 out of 100 (contractor “B” was best with 72.0). Brent has had problems over poor quality housing developments in recent memory.


The Quality section of the WHZ contract Tender Evaluation Grid.


Non-Cabinet councillors have five working days to call-in the Key Decision for scrutiny, if they consider there are reasonable grounds to do so. As it was published on 11 January, at least five members would need to call-in the decision by 5pm on Wednesday 18 January for the award of the contract to be put on hold, so that (probably) Community and Wellbeing Scrutiny Committee could consider it. It will be interesting to see whether that happens!


Philip Grant.



Philip Grant said...

I understand that Brent's opposition Conservative councillors would not support a call-in of the Key decision to award this contract.

Rather than seeking to increase the amount of genuinely affordable housing in the Wembley Housing Zone, it appears that they are ideologically opposed to any increase in social housing in Brent.

Martin Francis said...

That is unsurprising. We need some of the new Labour backbenchers to show their commitment to truly affordable housing to come forward and support a call-in. Think of that housing waiting list.