SWINDON Council is seeking a private partner to speed up the development of Wichelstowe.
Wichelstowe, which suffered setbacks in construction due to the decline in the housing market, has outline planning consent for between 3,800 and 4,500 homes, and 12.6 hectares of employment or commercial uses.
East Wichel, the first of three communities planned there, has been implemented by Taylor Wimpey and other developers working with Swindon Council, which owns most of the land at the overall site.
To speed up the scheme, the cabinet agreed on Wednesday to seek to create a joint venture partnership with a private organisation.
The partner could be a developer, a pension fund or whoever else is deemed appropriate.
The council would transfer into a new jointly-owned company its land, assets, loans and section 106 obligations relating to Wichelstowe, while the partner would invest money and bring expertise. The profits and risks would be shared by the partners equally.
Developing Wichelstowe quickly is vital for Swindon Council, as it borrowed £45m to fund some of area’s key infrastructure.
To deal with the interest, the council holds a compensation fund, which was a severance payment from Taylor Wimpey in exchange for the council letting it out of a building contract.
However, this fund is expected to run out in about four years, meaning the budget for everyday services will be hit if nothing is done.
Hitesh Patel, the council’s board director for transformation and strategic projects, recommended the joint venture partnership after looking into a range of options to develop the site.
His basis was that the council wanted to retain the right level of influence.
He said: “The objectives are to deliver a high quality development at Wichelstowe, to develop the whole of the scheme.
“That means not just the housing but the jobs and the community facilities also delivered during the lifetime of the project – and the project leaves the council on a safe or sound commercial footing.
“A number of options were considered, from selling the land to building the whole development ourselves, to partnering with somebody else to do that.
“The recommended option is the council seeks a joint venture partner which brings expertise, funding, will take risk and share some of the reward with the council.
“This is the best way forward.”
Cabinet has asked officers to commission specialist external advisors to support the evaluation, tender and set-up of a joint venture vehicle, funded through Wichelstowe compensation reserves.
The costs for the initial stages of the procurement exercise are estimated at £150,000 but the cabinet has been warned the cost to complete the procurement and set up a joint venture will be significantly more. A report will be brought to cabinet within six months on the procurement process to select a suitable partner.