The importance of reputation and values when negotiating s.106 agreements?

Developers familiar with negotiating planning obligations know to look out for certain things. For a large housing development there are likely to be affordable housing provisions, open space contributions and a range of other financial commitments covering everything from education to public transport. Until now the focus for developers (their lawyers and agents) has been on minimising the costs, delays any other liabilities associated with the obligations. Few have considered the wider reputational impact of the final negotiated agreement and its implementation. This may be about to change.

There has, for some time, been a growing public awareness of perceived ‘unfair’ arrangements, whereby tenants of the affordable housing units have access to fewer shared services than those occupying the open market units. Most recently, headlines were made by the Baylis Old School complex in south London. According to The Guardian (which originally reported the story) the development was, “segregating the children of less well-off tenants from those of wealthier homebuyers by blocking them from some communal play areas.”

It appears the original development was required to include a mix of affordable and social rental units, and was marketed as including common areas for all residents. The original plans also showed gates, which gave all flats access to the main play area. However, prior to occupation, permission was granted for a ‘minor’ amendment, converting the gates to hedges. This meant that the social housing tenants only had access to a small strip of play area and were excluded from the larger, grassy playground. It is from this that the outrage has stemmed.

After the matter came to light there was some confusion as to where responsibility for the final playground arrangements fell. However it was not long before the developer stepped up and made the announcement that all children could now use the main play area. This decision is likely to be welcomed by residents and campaigners, and many will consider that the developer made the right decision given the publicity the arrangement had attracted. Those involved in bringing forward such developments will, however, be mindful that the cost of maintaining open space will still need to be borne, either by the developer or more usually those who pay the service charge.

However, the story is also a helpful reminder that if Councils, developers, consultants and lawyers are too focused on discharging statutory obligations and minimising cost exposure, they can be taken by surprise by the backlash of adverse publicity and public hostility any ‘unfair’ arrangements can create. An understanding of the context, a little common sense, and an awareness of public sensibilities can always be helpful.

Posted on: 08/04/2019

This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.

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