The political soap opera this weekend, plus another fabulous sunny Autumn morning – versus writing a blog post about compulsory purchase? Time to use that thinking face emoji.
The inspector’s decision dated 4 October 2022 to decline to confirm the London Borough of Barking and Dagenham Council (Vicarage Field and surrounding land) Compulsory Purchase Order 2021 certainly brings with it some lessons, or at least reminders, for those promoting compulsory purchase orders in association with public/private sector regeneration projects.
Here are the inspector’s conclusions in full:
“368. The scheme underpinning the CPO is wholly in accordance with the development plan and has the benefit of outline planning permission. There is an extremely compelling case in the public interest for the development, in meeting economic, environmental and social needs. This would considerably outweigh the heritage harm and loss of existing jobs.
369. The shopping centre and town centre overall needs redevelopment, it is the lowest ranking Borough in London for poverty, and this scheme is the catalyst that would spark further regeneration. There are also no realistic alternative proposals that would achieve the purpose for which the AA is proposing to acquire the land.
370. I am completely aware that failure to confirm the CPO would have an adverse consequence of losing the opportunity to comprehensively redevelop the site at this time. The Council has staked its reputation on the delivery of the scheme and its delivery is critical to achieve its ambitions.
371. I fully recognise much of the potential financial viability of the scheme is reliant upon the scheme itself and it is a complete ‘catch 22’ situation. The developer is confident the Scheme will be delivered. The funding intentions are clear, and I have no doubt that the developer has access to funds.
372. Nevertheless, there is fundamental lack of tangible and substantive evidence on viability. Given the gravity of the 2016 appraisal, and the lack of an updated appraisal, I cannot be certain that the scheme is financially viable despite all assurances from the AA. Other methods to present the evidence confidentially could have been explored and, if the scheme was viable, I do not understand why this evidence was not presented. Whilst the AA claims viability evidence from objectors has not been presented, it is for the AA to demonstrate substantive information as to the financially viability of the scheme. It has not done so in a way that convinces me.
373. Consequently, because I cannot conclude that the scheme is financially viable, I cannot be confident that there is a reasonable prospect that the scheme will proceed at this time, or that the necessary resources are likely to be made available within a reasonable time scale. This is because there is an expectation of return, and no developer or investor would pursue a scheme that is not economically viable or feasible. This is even if it has access to funds, sees a long term vision, or pools funds so that one scheme may perform better than another. The legal agreements also provide me with little comfort of delivery, despite the depreciating value of the lease.
374. This makes it difficult to show conclusively that the compulsory acquisition of the land included in the order is justified in the public interest at this time, as detailed by CPO Guidance.
375. Added to this are my concerns that inadequate negotiations have taken place, when considering the CPO Guidance. It could not be said that delays have been keep to a minimum. The lag from Cabinet approving the making of the CPO to making the CPO was 3 years. There has been a significant delay in the submission of reserved matters applications, and the outline permission expires in April 2023.
376. The efforts to acquire the CPO lands by private treaty have also been largely ineffective. Claims are made by objectors that the financial offers have not been market value, and it is the shopping centre that has failed, not the surrounding businesses on Ripple Road and Station Parade. There have also been limited efforts to relocate those affected by the CPO to date. A ‘not before’ date has been absent and this has resulted in those subjected to the CPO unable to fulfil business plans, living in limbo for a long period of time. Full information was also not provided at the outset and there was no clearly specified case manager.
377. Consequently, whilst I acknowledge the pressing need for redevelopment and the extremely compelling case for the CPO, for the above reasons, I cannot confirm that the compulsory acquisition of the land included in this Order is proportionate or justified in the public interest.
378. Thus, the London Borough of Barking and Dagenham Council (Vicarage Field and surrounding land Compulsory Purchase Order) 2021 is not confirmed.”
I recommend that you read my partner Raj Gupta’s 10 October 2022 blog post The Vicarage Field CPO and viability and that you subscribe to his forthcoming posts which will cover:
- the Inspector’s criticisms of the promoter’s engagement with occupiers and the deficiencies of its relocation strategy.
- other points made by the Inspector including in relation to planning, publicity and timing matters with some bonus musings on whether the CPO reforms proposed by LURB (e.g. conditional confirmation) would have made any difference to the outcome.
The decision is no doubt frustrating to all those who worked so hard, with the best of objectives – whilst no doubt equivalently a huge relief for those organisations, businesses and individuals whose land interests, activities and livelihoods were at stake.
Michael Walton posted these words on LinkedIn:
“The proposed regeneration of Vicarage Field shopping centre in Barking adds enormous value to the transformative vision for the borough.
As Head of Regeneration Strategy at Be First I advised on initiatives which helped accelerate growth in Barking & Dagenham. Oversight of Vicarage Field was led by another division, and I moved on from Be First prior to the public inquiry into the CPO being held this year.
The decision made recently by the Inspector to not confirm the CPO is disappointing. Prior to it being made, I highlighted similar issues around deliverability. However, the Inspector also placed a high bar on negotiations with affected parties when reaching her decision.
Nonetheless, this should not deter local authorities from seeking CPO powers as part of their regeneration plans – it merely reinforces the need to de-risk projects and put forward a compelling case.”
Agreed. In fact, I suspect that the decision will prove helpful to promoters of future CPOs, in underlining for them what has to be in place, however difficult it may be in current uncertain circumstances, in order for a CPO to be confirmed.
Now to check whether the sun is still shining – and whether we still have a Prime Minister.
Simon Ricketts, 15 October 2022
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