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North Tyneside Community Infrastructure Levy

Area Wide Viability Assessment

2018

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North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

1. Introduction ...... 4 Previous area wide viability assessments ...... 4 Viability assessment to inform CIL submission and Proposed Modifications ...... 4 2. The Role and Scope of the North Tyneside Viability Assessment ...... 5 Proposed “key outcomes” for the North Tyneside Area Wide Viability Assessment ...... 6 3. The Assessment Methodology ...... 8 4. Summary of evidence informing the proposed Community Infrastructure Levy ...... 10 Neighbouring Local Authorities – The duty to co-operate ...... 15 5. Residential Housing Market Analysis ...... 17 Understanding sales values by floor area and location ...... 25 6. The Viability Assessment – Assumptions and Development Typology ...... 27 7. Benchmarking the AWVA ...... 40 8. Residential Appraisal Outcomes ...... 42 Greenfield Appraisals ...... 42 Brownfield Appraisals ...... 50 9. Commercial Development Appraisal ...... 58 Commercial Typology and Assumptions ...... 58 Commercial Appraisal Outcomes ...... 59 Industrial ...... 59 Supermarket ...... 59 Retail Parade ...... 60 Retail Warehouse ...... 60 Office ...... 60 Hotel ...... 61 Conclusions ...... 61 Appendices ...... 62

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

1 Introduction

Previous area wide viability assessments 1.1 To accompany the preparation of North Tyneside’s Community Infrastructure Levy Draft Charging Schedule evidence of the economic viability of development was provided through the series of Area Wide Viability Assessment (AWVA) documents including a AWVA Community Infrastructure Levy Sensitivity, Addendum 2017. The 2016 Area Wide Viability Assessment supported the North Tyneside Local Plan through Examination in Public alongside additional site specific viability assessments for the two strategic allocations included in the Local Plan. The 2017 AWVA CIL addendum developed this core assessment to take into consideration the effect of a CIL charge upon the viability of development in the Borough. Whilst previous iterations of the Authority’s viability evidence will also continue to assist in informing understanding of the evolution of the Local Plan and CIL in North Tyneside this update also seeks to consolidate the relevant AWVA evidence into a single report.

Viability assessment to inform CIL submission and Proposed Modifications 1.2 This 2018 AWVA CIL Update has been prepared to accompany submission of the CIL Draft Charging Schedule. It has been amended to take into consideration proposed modifications submitted alongside the Draft Charging Schedule and to assist in responding to representations received to the Authority through consultation. It additionally outlines the evidence collated to support formulation of the proposed potential differential charging zones for residential and commercial development.

1.3 North Tyneside Council anticipate continued evolution of its Viability Assessment as proposals for Community Infrastructure Levy progress and welcomes feedback particularly from all aspects of the development industry, landowners and agents on the assumptions and conclusions of this viability assessment.

1.4 The North Tyneside VA has been prepared by the North Tyneside Council and Capita partnership. This involves a wide cross section of the Partnerships development and market expertise including the Strategic Property Team, led by two Senior Property Surveyors, and an Assistant Property Surveyor. The Strategic Property Team has an extensive record of development and property market expertise and has particular knowledge and experience within North Tyneside.

National planning context and latest consultation on the future of Community Infrastructure Levy 1.5 CIL was introduced by the Planning Act 2008 and came into force through the Community Infrastructure Levy Regulations 2010. CIL is a fixed charge upon the floor area created by any development. Monies raised through CIL are pooled into a single fund to help pay for identified strategic and local infrastructure such as, schools, flood mitigation, leisure facilities, highways improvements and other community facilities. These are identified in a CIL Infrastructure List (Regulation 123 List) which is published alongside CIL. 4

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

1.6 A key driver for the preparation of CIL is the restrictions currently in place for the use of planning obligations secured through section 106 agreements. Currently CIL regulations dictate that where a collection of planning applications may cumulatively result in a requirement for a particular infrastructure project, legislation is in place which limits funding being pooled from no more than five separate legal agreements.

1.7 For certain types of infrastructure that may be strategic in scale or nature with a requirement for contributions from a wide range of schemes this raises challenges to Local Planning Authorities seeking to ensure sufficient funding is in place to meet the infrastructure requirements arising from growth in their area. The purpose of CIL is specifically to address this challenge and enable such forms of infrastructure to be funded.

1.8 As highlighted by the government consultation launched in March 2018,there are a number of issues with the current CIL regime and the government has been reviewing potential amendments to application of CIL and crucially pooling thresholds for use of planning obligations for a number of years.

1.9 The proposed consultation itself retains CIL as a form of developer contribution and will continue to apply a pooling threshold to use of S106. However, in certain circumstances it is proposed that pooling thresholds may be lifted. These circumstances include:  Remove the pooling restriction in areas that have adopted CIL;  Where authorities fall under a threshold based on the tenth percentile of average new build house prices, meaning CIL cannot feasibly charged; or  Where development is planned on several strategic sites

1.10 Sales values do not indicate North Tyneside would be classed as under the proposed tenth percentile. As such, removal of pooling thresholds in North Tyneside would be based having an adopted CIL or the nature of development sites in the Borough. The Strategic Allocations of Murton Gap and Killingworth Moor are approximately 50% of North Tynesides remaining development requirements (once other permitted homes are taken into account). The presence of the strategic allocations may consequently mean North Tyneside would fit this criteria. However, it is unclear precisely what would be required for a site or sites to be defined as strategic in this context and it is noted within the consultation that this definition itself may require legislative amendments.

1.11 Therefore, North Tyneside Council’s assessment is that potential changes to CIL remain a possibility through the adoption process and the Authority will need to remain alert to potential implications. However, no decisions are expected until later in 2018 on the government approach and legislative changes will be required to implement any amendments to the system. As such, continued progression to adoption of a CIL based upon the broad principles set out in the Preliminary Draft Charging Schedule and Draft Charging Schedule is viewed as appropriate.

2 The Role and Scope of the North Tyneside Viability Assessment

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

2.1 The National Planning Policy Framework (NPPF) emphasises the importance of securing sustainable development through planning. Key messages within the NPPF highlight the importance of plans being deliverable, with an understanding of the viability of development and the cumulative impact Local Plan policies and requirements might have on delivery.

2.2 Central to assessing the viability impacts of Local Plan policies is paragraph 173 of NPPF. This requires that … “To ensure viability, the costs of any requirements likely to be applied to development, such as requirements for affordable housing, standards, infrastructure contributions or other requirements should, when taking account of the normal cost of development and mitigation, provide competitive returns to a willing land owner and willing developer to enable the development to be deliverable.”

2.3 The North Tyneside Viability Assessment was initially developed in accordance with the guidance provided in Section 2 of the June 2012 Local Housing Delivery Group Paper “Viability Testing for Local Plans” 1 and other available sources of information and guidance including “Financial Viability in Planning” 2 prepared by the Royal Institute of Chartered Surveyors.

2.4 The assessments undertaken in preparation of CIL have been crucial to ensuring conformity with the guidance and requirements for setting CIL set out in planning guidance.

“Charging authorities should set a rate which does not threaten the ability to develop viably the sites and scale of development identified in the relevant Plan (the Local Plan in England, Local Development Plan in Wales, and the London Plan in London). They will need to draw on the infrastructure planning evidence that underpins the development strategy for their area. Charging authorities should use that evidence to strike an appropriate balance between the desirability of funding infrastructure from the levy and the potential impact upon the economic viability of development across their area.”

2.5 In addition prior to submission of the Community Infrastructure Levy a further review has been undertaken to consider alignment of the approach undertaken with the emerging draft Planning Guidance for Viability in Planning published in March 2018.

Proposed “key outcomes” for the North Tyneside Area Wide Viability Assessment 2.6 The North Tyneside Area Wide Viability Assessment (AWVA) has been developed over a number of years to establish a proportionate approach to the evidence required to demonstrate initially that the proposals of the emerging Local Plan were deliverable and further adapted to inform the consideration of Community Infrastructure Levy. This accords with the initial objectives for preparation of the AWVA in 2013/14 that set out to include:  An assessment of area wide plan viability over the short, medium and long term.  An update to the Affordable Housing Viability Assessment 2009.  Local Plan Site Allocation appraisals for residential and economic development.

1.1 1Local Housing Delivery Group Paper, “Viability Testing for Local Plans”, June 2012 2 Royal Institute of Chartered Surveyors, “Financial Viability in planning”

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

 Development of an assessment tool to test impacts of Community Infrastructure Levy.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

3 The Assessment Methodology The North Tyneside AWVA was developed in tandem with progression of the Borough’s Local Plan. This approach considered the potential costs of proposed Local Plan policies and development viability appraisals.

3.1 The development viability appraisals are based on a residual land value. In simple terms, a calculation taking the overall sales value of any development less the full range of costs associated with bringing forward the scheme. As illustrated in Figure 1 where after undertaking that calculation all costs and necessary profits can be covered by the value of the development, the scheme is a viable proposition.

Figure 1: Basic outline of elements required for a viability assessment

Viability Testing Local Plans: Advice for Planning Practitioners, June 2012

3.2 A number of models were considered in determining the most appropriate approach to appraise viability. Initially work was undertaken using the Homes and Community Agency’s Area Wide Viability Model. This offered significant flexibility in assessing the overall potential for all developments in North Tyneside to accommodate affordable housing. However, it was finally determined that the freely available Homes and Community Agency Development Appraisal Tool3 for residential development provided the most appropriate modelling tool.

3.3 North Tyneside Council has included production of a Community Infrastructure Levy (CIL) since publication of the Local Development Scheme 2014. CIL is a locally based development charge that Local Authorities as the Charging Authority can choose to impose to help finance a wide range of identified infrastructure requirements within their area. CIL came into force on 6 April 2010, under the Community Infrastructure Levy Regulations 2010 (SI 948). The regulations were amended in, 2012 , 2013 and 2014.

1.1 3 Homes and Communities Agency, Development Appraisal Tool https://www.gov.uk/government/collections/development-appraisal-tool

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

National Planning Guidance4 for CIL was published in 2014 and last updated in March 2018.

3.4 The CIL regulations place clear controls on the role of planning obligations and limit the degree to which contributions can be pooled to contribute to a single infrastructure project or type. However, planning obligations will continue to be the means to secure contributions to affordable housing provision and can be used for a more limited range of site specific infrastructure requirements arising from development.

3.5 In order to charge CIL, the Local Authority must set out its proposed levy rates in a Charging Schedule. Introduction of CIL is subject to an independent examination where evidence is required to:  Demonstrate that the charging schedule is consistent with and supports the implementation of an up-to-date development plan – for North Tyneside this will be the Local Plan;  Identify the total cost of the infrastructure that the Local Authority wishes to fund through the CIL, known as the “aggregate funding gap” that would be demonstrated through the Infrastructure Delivery Plan; and,  Demonstrate as background evidence the potential impact of the CIL charge on the economic viability of development in the area; tested through the Area Wide Viability Assessment.

The approach to viability assessment 3.6 The specific details for each of the assumptions are outlined in greater detail later in this Viability Assessment Consultation Report. As a basic outline, the approach proposed and adopted to date in preparing the North Tyneside VA has identified: a. Development Typologies based on evidence in the Strategic Housing Land Availability Assessment, Strategic Housing Market Assessment, Employment Land Review, and recognised patterns of development and available sites in North Tyneside for residential and commercial development. The development typologies have been further developed in response to feedback from consultees through the CIL process, particularly in relation to floor areas of homes, and expanded to include specific appraisal of the large Strategic Allocations of Murton Gap and Killingworth Moor.

b. A Threshold Land Values informed by an overall uplift against Existing Use Value, below which selected sites are unlikely to be released by a landowner for development

3.7 A range of evidence base documents have, or are being prepared, that support and inform the North Tyneside Viability Assessment. A summary of each of these documents and their potential relationship to the Viability Assessment is set out below.

1.1 1.1 4 CIL Planning Guidance: http://planningguidance.planningportal.gov.uk/blog/guidance/community-infrastructure- levy/

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

4 Summary of evidence informing the proposed Community Infrastructure Levy

Viability assessment history 4.1 As already noted in this report the preparation of viability assessment for North Tyneside both to inform the Local Plan and Community Infrastructure Levy has been developed and evolved over a number of years. The following notes each of the previous documents prepared to support this CIL submission viability update.

i. The first report prepared in 20155 established an Initial Residual Land Value taking into account the total cost assumptions, including developer profit, and the gross development value and identified the margin between the threshold land value and Initial Residual Land Value.

ii. The 2016 Update6 provided further analysis of known development sites testing the implications of variations to floor area, affordability and s106. This assessment also introduced initial analysis of the impacts of policy regarding Optional Technical Housing Standards and Starter Homes. Results reflected and were based upon these costs being included within the appraisal model. The overall land value uplift achieved over EUV was reported as a figure per hectare and multiplier over EUV

iii. Also in 2016 the Local Plan was supported by the Murton Gap and Killingworth Moor Project Viability and Delivery Report that provided a site specific assessment of the viability of development of the proposed strategic allocations in the context of the site specific infrastructure requirements identified.

iv. The 2017 Area Wide Viability Assessment: Housing Standards Addendum7 was undertaken following examination and public. This developed the 2016 update specifically testing in greater detail the implications of the proposed Nationally Described Space Standards and Optional Building Regulation M4(2) accessible and adaptable homes.

v. The 2017 CIL Addendum was then published in 2017. This developed multiple scenarios for each development typology to consider the level of S106 and CIL payments that could be achieved in the Borough.

4.2 To inform the 2015 Viability Assessment engagement was undertaken with the development industry and significant landowners in North Tyneside to discuss the range of appraisal assumptions, development and land values included in the model. A key element of this engagement in relation to residential viability was a series of workshops involving private house builders and Registered Providers. Through the remainder of the Local Plan 1.1 5 2015 Residential Viability Assessment https://my.northtyneside.gov.uk/sites/default/files/web-page-related- files/Draft%20Area%20Wide%20Viability%20Assessment%202015.pdf 6 2016 Update https://my.northtyneside.gov.uk/sites/default/files/web-page-related- files/Draft%20Area%20Wide%20Viability%20Assessment%202016%20Update.pdf and Commercial Viability Assessment https://my.northtyneside.gov.uk/sites/default/files/web-page-related- files/Draft%20Area%20Wide%20Viability%20Assessment%202016%20Commercial%20evidence%20update.pdf 7 2017 Area Wide Viability Assessment: Housing Standards Addendum http://northtyneside.limehouse.co.uk/file/4931038

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

process and examination the Viability Assessment reports and assumptions were published as evidence alongside the Local Plan and subject to challenge and review by the development industry and Inspector undertaking the Local Plan Examination in Public.

4.3 To inform the CIL process a further workshop was held with key developers in North Tyneside in August 2017. This primary considered and facilitated discussion with developers regarding their view of CIL in general as a tool for securing developer contributions. However, the discussion also highlighted the importance of ensuring appropriate linkage between assumed average floor areas and likely development across the Borough.

4.4 This 2018 AWVA CIL Update further develops the findings of the 2017 CIL Addendum ensuring that the viability implications of revisions to development typology and proposed modifications are understood.

Infrastructure Delivery Plan 4.5 Alongside development of the emerging Local Plan, North Tyneside Council prepared an area wide Infrastructure Delivery Plan (IDP) (Please note updated IDP 2018 submitted alongside CIL Draft Charging Schedule8) and additional Site Specific Infrastructure Delivery Plans for the Strategic Allocations of Murton Gap and Killingworth Moor.

4.6 The IDP seeks to describe North Tyneside’s infrastructure requirements for the life of the Local Plan, the funding identified to support delivery of that infrastructure and potential gaps in funding that may be sought through other as yet unconfirmed sources, including contributions from development. Production of North Tyneside’s IDP has been informed by extensive consultation with utility and service providers and key stakeholders with a role in the delivery of facilities and infrastructure in the Borough.

4.7 The Site Specific IDP for the strategic allocations were developed through close partnership working between North Tyneside Council and the Development Consortia for Murton Gap and Killingworth Moor that included assessment of relevant evidence and preparation of Outline Delivery Frameworks for each site. This Site Specific IDP identified a full schedule of costs associated with the infrastructure necessary to ensure sustainable delivery of these large, complex sites.

4.8 In 2017 and within the 2018 update the area wide and site specific infrastructure requirements arising for Killingworth Moor and Murton Gap have been integrated. This supports understanding of the overall infrastructure need in North Tyneside and the potential funding gap in the Borough.

4.9 The 2018 update indicates that there is a total funding gap for critical infrastructure of some £90m, with a total infrastructure funding gap of at least £130m.

The Regulation 123 list, costs and potential CIL revenue 4.10 The Draft Regulation 123 is the infrastructure that the Council proposes to fund through the CIL revenue and for which planning contributions through S106 agreements will not be 1.1 8 CIL Examination News http://northtyneside-consult.limehouse.co.uk/portal/cil_examination_news

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

sought. In drawing up this list the Council referred to the Local Plan and the Infrastructure Delivery Plan (IDP) that supported the Local Plan to consider the infrastructure needs moving forward. The infrastructure Delivery schedule (IDS) of the IDP provides a breakdown of all the known infrastructure projects with costs identified wherever possible.

4.11 The items included on the Regulation 123 List are considered to be primarily strategic in their impact. The infrastructure on the Regulation 123 list are considered to be deliverable in large part by CIL and more suited in nature or scale to funding via a CIL charge than a s106 contribution. Delivering the infrastructure items included on Regulation 123 via a S106 agreement would present challenges in managing the legislative pooling thresholds for planning obligations that could risk the timely and necessary infrastructure being delivered. The option of developing a longer Regulation 123 List that took into account a wider range of infrastructure types was considered. However, it was determined that this would create additional complexity and include infrastructure projects more likely to arise as a result of specific developments and therefore best served via S106 agreements.

4.12 Through the process of preparing CIL the Council has had regard to and sought to align the potential costs of infrastructure likely to be funded through CIL and the viable CIL revenue. However, there is a potential shortfall in CIL contributions and additional means of funding particularly to support investment in secondary education will be continue to be sought.

4.13 The strategic allocations are the largest two developments in North Tyneside and in total will provide about 5,000 homes towards an outstanding housing requirement of about 10,000 homes. As a consequence the strategic allocations will have a major impact upon overall growth and infrastructure requirements in North Tyneside and commensurately make a substantial overall contribution to anticipated CIL revenue. The Regulation 123 infrastructure provide strategic borough wide benefits and will also mitigate impacts arising from the delivery of the strategic allocated sites.

4.14 Some items on the Regulation 123 list reflect infrastructure types identified in the IDS such as health and community facilities. Such infrastructure types do not at this stage necessarily have specific projects attached to them at this stage. In these circumstances the costs identified reflect the guidance provided through the Planning Obligations SPD and the broad trends in s106 collection for such infrastructure types.

4.15 Alongside the process of bringing forward a CIL for North Tyneside the Council has also updated the planning obligations SPD. A planning obligation, also known as a Section 106 Agreement, is a commitment undertaken by a developer to mitigate site specific impacts caused by new development. They must be necessary and used directly to make a development acceptable and the Council believes that the majority of infrastructure required as a result of new development planned in the Borough will be sought by this method. This results in the developers being responsible for the delivery of the infrastructure and not the charging authority (the Council) which is the case with CIL.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 2: Regulation 123 List infrastructure costs and estimated CIL revenue Secondary Education including indicative cost of land £26,000,000 Health £4,035,792 Community Facilities £1,758,780 Infrastructure Costs Off site walking and cycling infrastructure £2,609,580 SANG £2,000,000 Total £36,404,152

Murton £16,206,750 Killingworth £10,804,500 Revenue arising from Rest of the Borough £3,836,025 residential CIL contribution £30,847,275 development Existing S106 contribution to secondary education £2,850,000 Total estimated funding £33,697,275 Estimated shortfall (based upon revenue arising from residential development) -£2,706,877

Planning Obligations Supplementary Planning Document 4.16 The Local Plan is supported by the Planning Obligations Supplementary Planning Document (SPD)9. An updated SPD was adopted in March 2018 that sets out updated detail on the range and scope of likely contributions to be sought from developers when necessary as part of the planning application process.

4.17 Planning Obligations are expected to remain a key element of developer funding following adoption of the emerging Local Plan and a revision of the Planning Obligations SPD is planned following adoption of the Local Plan. Analysis of the current level of contributions secured through the SPD provides a useful summary of the current costs currently arising for development schemes to ensure that the impact on infrastructure provision is addressed.

Figure 2a: Funding secured through S106 Contributions by infrastructure area Number of Total S106 secured Average per contributing Dwellings dwelling Highways 5,103 £2,346,743 £460 Ecology 4,922 £555,331 £149 Education 4,776 10,294,404 £2,155 Employment 4,675 £421,780 £90 Sport and Leisure 4,560 £2,175,023 £477 Parks 4,463 £2,032,567 £455 Health 3,192 £1,636,354 £513 Pedestrian and Cycling 3,177 £1,055,723 £332 Travel Plan Bond 3,090 £749,000 £242 Playsites 2,892 £1,015,628 £351 Allotments 2,332 £395,882 £170 Public Transport 1,286 £735,135 £572 Air Quality Monitoring 834 £15,000 £35 Affordable Housing (Commuted Sum) 584 £9,743,000 £16,683 Community Facilities and cultural services 452 76,786 £170 Public Right of Way 425 £323,000 £760 Libraries 397 £86,054 £217 Public Art 330 £50,000 £152 Noise 87 £100,000 £1,149

1.1 9Planning Obligations SPD 2018 https://my.northtyneside.gov.uk/sites/default/files/web-page-related- files/planning%20obligation_0.pdf

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

4.18 S106 contributions sought from any one scheme depend on the specific impacts arising from that scheme; and the viability of the individual scheme to deliver any or all of the proposed contributions being sought. As a result it is not typical for any one scheme to make contributions to all forms of infrastructure requirements.

4.19 For comparison the proposed charging rates identified in the latest Proposed Modifications have been added to the above table at Figure 2a. This suggests that some smaller schemes in North Tyneside that typically have been too small to make meaningful contributions to infrastructure such as health and education could see their total contribution increase. This report presents findings illustrating the viability evidence that has been considered in arriving at that proposed charging rate.

Figure 3: Commercial s106 contributions Planning reference Development type Gross Infrastructure S106 agreed Internal Area 16/00646/FUL Industrial estate - wildlife corridor n/a Ecology £5,250 17/00531/FUL Car sales superstore 845sqm Ecology £2,857 16/01922/FUL Energy from Waste About Employment £0 4,000sqm 15/01146/OUT Retail units 13,200sqm Pedestrian and Cycling £187,104 15/01146/OUT Retail units 13,200sqm Travel Plan Bond £50,000 15/01708/FUL Supermarket 2,470sqm Employment £14,800 15/01708/FUL Supermarket 2,470sqm Public Art £15,000 15/00699/OUT B2/B8 Industrial units 20,752sqm Highways £91,449 15/00699/OUT B2/B8 Industrial units 20,752sqm Ecology £20,000 15/00699/OUT B2/B8 Industrial units 20,752sqm Travel Plan Bond £50,000 15/00699/OUT B2/B8 Industrial units 20,752sqm Highways £91,449 14/01698/FUL Retail units 9,476sqm Public Art £30,000 14/01698/FUL Retail units 9,476sqm Employment £11,520 Source: Local Authority Developer Contributions Monitoring, Update April 2018

4.20 Appendix 1 to this report provides a schedule of all residential planning permissions and total contributions secured through Section 106 agreements. North Tyneside Council regularly publishes updated monitoring information regarding s106 contributions on its website here: https://my.northtyneside.gov.uk/category/1140/monitoring-reports.

Housing, employment and retail needs and supply10

The Strategic Housing Land Availability Assessment (SHLAA) 4.21 The North Tyneside SHLAA is updated annually and provides a robust assessment of site delivery. The SHLAA update 2016 was considered and provided a key source of evidence to support the allocation of housing sites within the Local Plan. The identification of sites through the SHLAA provides an important tool for assisting in the assessment of development viability and estimates of potential section 106 and CIL revenue over the life 1.1 10 North Tyneside Housing and Employment Evidence - https://my.northtyneside.gov.uk/category/1134/housing-and-employment

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

of the Local Plan. Figure 4 below outlines forecast future housing delivery based upon the SHLAA 2017 based upon completions to March 31 2017.

Figure 4: Forecast of future housing delivery, 2017 Phase 1 Phase 2 Phase 3 Phase 4 Phase 5

2011/12 – 2017/18 – 2021/22 – 2026/27 – Total 2031/2032 15/16 20/21 25/26 30/31 Planning Permissions - 2,513 1,365 245 - 4,123 Local Plan Site Allocations - 1,348 4,233 2,173 230 7,984 Total Site-Specific Delivery - 3,861 5,598 3,012 230 12,701 Allowances (small sites & windfall) - 303 485 485 97 1,370 Total Identified Delivery (for Local Plan - 4,164 6,083 3,497 327 14,071 to 2032) Other Sites in the Planning Process - 46 154 - - 200 Other SHLAA Sites - 71 1,287 997 149 2,504 NTC Housing Project - 88 - - - 88 Total 4,369 7,524 3,900 476 16,269 Source: North Tyneside SHLAA 2017 Update

The Strategic Housing Market Assessment (SHMA) 4.24 A review of the SHMA, published in 2015, included a comprehensive household survey and provided up-to-date evidence of the housing market, including analysis of sales values and value areas in North Tyneside to inform the North Tyneside VA. The SHMA in particular provides important evidence to inform and support the value bands identified for development within the North Tyneside Viability Assessment. It also sets out evidence of specialist housing needs.

The North Tyneside Employment Land Review 2015 (ELR) 4.25 The 2015 ELR was considered as evidence to inform the North Tyneside Local Plan and was considered through Examination in Public in 2016. Part of this Study has been to appraise the commercial and industrial property market in North Tyneside. It has directly informed the work of the North Tyneside VA in appraising the suitability and market attractiveness of these sites within the Borough for this form of development.

Retail and Leisure Study 2011 and Update 201411 4.26 The 2011 study prepared by Roger Tym and Partners could provide contextual data to support the appraisal of retail and leisure development. However, it does not include detailed financial information for such development. An update of the Retail Study was completed in early 2015, providing useful supporting information about the potential for retail growth in North Tyneside, informing assessments of viability.

Neighbouring Local Authorities – The duty to co-operate 4.27 In considering and assessing viability and ensuring appropriate development contributions towards infrastructure needs and sustainability, regard the methods and assumptions adopted by neighbouring Local Authorities is a useful exercise. Currently in the North East Combined Authority area only Newcastle City Council and Gateshead Borough Council have adopted CIL. Northumberland County Council whilst closely related to North Tyneside has not yet adopted a post NPPF development plan and is some years from preparation of a CIL. 1.1 11 Retail and Leisure evidence https://my.northtyneside.gov.uk/category/1137/retail-leisure-and-regeneration

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

4.28 Newcastle City Council adopted a CIL charging schedule in November 2016. This charging schedule divides the City into three value bands for residential development and commercial development. For residential development Zone A (£60/sqm) includes an area to the north of the city adjacent to the boundary with North Tyneside at West Moor and Wideopen. Zone B (£30/sqm) is largely urban in nature and incorporates the higher market value areas of Gosforth and Jesmond. The remainder of Newcastle City Council’s area is identified as Zone C (£0/sqm). For Commercial development, Zone A includes the City Centre and Zone B includes the area north of the city centre focused upon Gosforth and Jesmond plus small pockets at Newcastle Airport and Kingston Park.

Figure 5: Newcastle City Council – Preliminary Charging Schedule 2012 Residential Residential Residential Commercial Commercial Commercial Zone A Zone B Zone C Zone A Zone B Zone C Dwellings1 (inc. sheltered £60/sqm £30/sqm £0 £0 - - housing) (C3) Student accommodation2 - - - £50/sqm £50/sqm £0 (C3, C4, Sui Generis) Hotels (C1) - - - £0 £40/sqm £0 Small retail (A1) units ≤ 280 - - - £0 £30/sqm £0 sqm net floorspace Supermarket3 (A1)> 280 - - - £10/sqm £10/sqm £10/sqm sqm net floorspace Retail Warehousing4 (A1) - - - £0 £50/sqm £50/sqm >280 sqm net floorspace All Other Development5 £0 £0 £0 £0 £0 £0 1 Dwellings- includes houses and flats 2 Purpose built student accommodation which usually has an element of communal facilities. 3 Supermarkets are convenience–led stores selling mainly everyday essential items, including food, drinks, newspapers/ magazines and confectionary, where it is intended to utilise less than 50% of the gross retail floor area for the sale of comparison goods and where, depending on scale, weekly food shopping needs are met. In addition, the area used for the sale of goods will generally be above that applied for the purposes of the Sunday Trading Act of 280sq. m. 4 Retail warehouses are usually large stores specialising in the sale of household goods (such as carpets, furniture and electrical goods), DIY items and other ranges of goods. They can be stand-alone units, but are also often developed as part of retail parks. In either case, they are usually located outside of existing town centres and cater mainly for car-borne customers. As such, they usually have large adjacent, dedicated surface parking. 5 For clarity this includes: Office (Use Class B business, industry, storage and distribution), Extra Care (Use Class C2) Source: Newcastle CIL Charging Schedule, https://www.newcastle.gov.uk/sites/default/files/wwwfileroot/planning- and-buildings/planning-and-development/charging_schedule_november_2016.pdf

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

5 Residential Housing Market Analysis

5.1 Whilst there are specific issues affecting every development scheme that makes them unique and affects their viability, this area wide assessment develops a set of assumptions that consider the broad costs and values for housing development in the Borough. To inform those assumptions the AWVA has been informed by analysis of the market context, available evidence and feedback from stakeholders to ensure assessments provide an appropriate representation of the overall viability of development in the Borough.

Market context

5.2 The overall context for residential development values provides an important initial benchmark from which development appraisals can be developed. As an initial indication of the housing market context Figure 6 below identifies the House Price Index for England and Wales, Newcastle upon Tyne the North East and North Tyneside.

Figure 6: Price change September January 2015 to February 2018

Source: Land Registry House Price Index, Monthly Average House Price, September 2015

As is apparent from Figure 6, like much of the north and north east, house price growth in North Tyneside has not kept pace with the average across England and Wales since 2015. By December 2017 the overall house price index for North Tyneside was above the North East average and marginally above growth in Newcastle over this period.

The analysis in Figure 7 provides detail on the sale price of all homes across North Tyneside, Newcastle, Tyne and Wear, the North East and England and Wales between 2015 and 2018.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 7: Average price change all homes 2015 to 2018 North Tyneside Newcastle upon Tyne Tyne and Wear North East England and Wales

2015-02 £142,575 £144,951 £127,116 £118,525 £199,522 2016-02 £148,679 £150,838 £131,374 £121,085 £216,083 2017-02 £154,218 £154,826 £134,689 £124,088 £227,555 2018-02 £160,511 £161,211 £138,755 £128,218 £236,909 Source: Land Registry Price Paid Data

5.3 Figure 7 reveals that there is a marginal gap between sales values in North Tyneside and Newcastle upon Tyne, with this gap closing slightly in 2017 and 2018 compared to 2015 and 2016. This relationship is further illustrated in the ONS statistics released annual to identify identifying median house prices and median residence based earnings by district.

Figure 8: Ratio of Median House Prices to Median Residence Based Earnings 2002 to 2017 Year ending Year ending Year ending Year ending Year ending Sep 2013 Sep 2014 Sep 2015 Sep 2016 Sep 2017 House price £137,500 £143,528 £155,000 £155,000 £162,725 North Tyneside Earnings 24,185 24,480 25,757 26,092 28,011

Ratio 5.69 5.86 6.02 5.94 5.81 House price £137,500 £141,000 £150,000 £155,000 £155,998 Newcastle upon Tyne Earnings 24,287 25,343 26,425 26,577 26,655

Ratio 5.66 5.56 5.68 5.83 5.85 House price £124,598 £128,895 £137,000 £138,400 £141,135 Tyne and Wear Earnings £24,113 £24,598 £25,256 £25,327 £26,155

Ratio 5.17 5.24 5.42 5.46 5.40 House price £121,103 £126,410 £132,448 £134,083 £135,551 North East Earnings £24,085 £24,802 £25,320 £25,725 £26,080

Ratio 5.03 5.10 5.23 5.21 5.20 House price £195,307 £209,853 £226,826 £244,090 £258,537 England and Wales Earnings £27,324 £27,492 £27,877 £28,578 £29,147

Ratio 7.15 7.63 8.14 8.54 8.87 Source: Office for National Statistics, Ratio of House Prices to Residence Based Earnings 2002 to 2017

5.9 Data for the most recent year ending September 2017 appears to indicate a notable increase both in house prices and residence based earnings for North Tyneside. On balance it is notable that there is little distinction in house prices in Newcastle and North Tyneside. However, from the figures published by ONS that over the period considered average median house prices have exceeded or matched those in Newcastle in each of the previous five years. This contrasts with the mean average sale price identified in Figure 7 which reflects a greater volume of homes in North Tyneside sold at a lower value. This is reflected in ONS data on lowest quartile house prices – identified as £112,000 in North Tyneside and £114,000 in Newcastle.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

5.10 The above data reflects the overall housing market in North Tyneside. Overall, this illustrates that the housing market in both Newcastle and North Tyneside are substantially more expensive than sales values across Tyne and Wear and the wider North East but remain significantly more affordable than the average across England and Wales.

5.11 The following analysis seeks to consider specifically the new homes market in North Tyneside. Figure 9 below illustrates the strengthening delivery of new homes in North Tyneside since 2012/13. This uplift in delivery mirrors wider improvements in the homebuilding market over the period but also reflects specifically the renewed availability of land in North Tyneside as a number of major housing sites gained planning permission and have subsequently driven increased house building rates.

Figure 9: New home completions 2012/13 to 2017/18 Year Gross completions 2012/13 495 2013/14 447 2014/15 568 2015/16 775 2016/17 854 2017/18 Est. over 900 * Source: North Tyneside Planning Monitoring

*total gross additions pending confirmation following analysis of splits and mergers

5.12 The following table based upon Land registry sales data for new homes identifies both the overall sale value of new homes in North Tyneside and Newcastle between 2013 and 2017 and the price range within the new homes market.

Figure 10: New Home Sale Prices 2013 to 2017/18 in North Tyneside and Newcastle upon Tyne (excluding “Other” transactions) NORTH TYNESIDE 2013 2014 2015 2016 2017 Number of records 254 254 459 395 553 Total value of sales £51,399,357 £59,861,896 £100,419,909 £90,562,524 £148,255,832 Average £202,360 £235,677 £218,780 £229,272 £268,094 Higher third (mean average) £298,449 £296,571 £311,628 £326,929 £368,865 Middle third (mean average) £187,610 £204,006 £204,474 £220,430 £263,204 Lower third (mean average) £123,454 £135,239 £125,274 £142,594 £173,785

NEWCASTLE UPON TYNE 2013 2014 2015 2016 2017 Number of Records 344 475 542 572 503 Total value of sales £68,349,458 £80,398,950 £108,058,043 £114,842,933 £93,788,065 Average £198,690 £169,261 £199,369 £200,774 £186,457 Higher third (average) £290,335 £252,882 £303,070 £300,799 £277,142 Middle third (average) £179,681 £161,945 £177,224 £168,030 £160,087 Lower third (average) £120,942 £94,129 £116,393 £129,658 £121,540 Source: Land Registry Price Paid Data 2013 to February 2018

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Variation in the housing market informing CIL Charging Zones

5.13 The approach to CIL can take a number of approaches. A flat rate CIL charge could be applied across the whole Borough. This would provide a simpler overall structure but would require the identified CIL rate to be set at a level that did not unduly impair the ability of development in lower and medium value market areas to come forward. As an alternative to this approach the CIL regulations allow for an adjustment to be made to CIL charging rates based upon the viability of development.

5.14 Overall North Tyneside represents a fairly contiguous urban area. However, there are established variations in average house prices across the area. Reflecting this and to ensure both the best return from CIL and avoid unduly harming the deliverability of development stepped charge reflecting these housing market areas has been pursued.

5.15 A series of indicative housing market zones were initially identified for North Tyneside within the emerging North Tyneside Strategic Housing Market Assessment (SHMA). This SHMA prepared during 2014 and 2015 identified three broad value areas. These value areas are outlined at Figure 11 on the following page.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 11: Average House Prices – North Tyneside 2012/13

Source: Land Registry House Prices / North Tyneside SHMA (Arc4)

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North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

5.16 To assist in wider analysis of the available data the SHMA established this value zones at ward level to provide comparison with an areas' demography and Council priorities. The following table at Figure 12 groups each North Tyneside ward by value band.

Figure 12: Market value areas by Ward Lower value Medium value Higher value <£70,000 to £120,000 £120,000 to £170,000 £170,000 plus Battle Hill Benton Cullercoats Camperdown Collingwood Monkseaton North Chirton Killingworth St Mary’s Howdon Longbenton Tynemouth Northumberland Monkseaton South Preston Riverside Valley Wallsend Weetslade Whitley Bay

5.44 As illustrated via the broad areas identified through the SHMA to inform the Local Plan there are three broad value zones in North Tyneside. Areas to the south and west of the Borough are generally of lower value. The remaining areas and greatest number of wards within North Tyneside are of medium value. Within the urban area a higher value area extends along the Coast and east of the Borough with further higher value pockets elsewhere such as at Benton and Killingworth village too small to be recorded at ward level.

5.45 To inform preparation of CIL therefore this initial identification of broad value areas suggested that a stepped charging schedule might be appropriate for the Borough if justified. However, a CIL charge based upon ward boundaries does not provide sufficient sensitivity to the variation in market value across the Borough. Reflecting this, to inform the 2017 AWVA CIL sensitivity addendum an analysis was undertaken of land registry data by house price.

5.46 To provide a significant enough sample to be informative this analysis is based upon the sale of all homes in the Borough. Figure 13 on the next page maps this data by postcode area informed by actual sales data and estimated prices. Estimated values were arrived at through GIS analysis of the actual sales prices of each adjacent postcode area to establish an average between those adjacent postcodes.

5.47 Combined with this postcode level price analysis and the SHMA housing market area zones a series of propose CIL charging zones were identified in the North Tyneside Preliminary Draft Charging Schedule in February 2017. The boundaries of these charging zones have remained largely unchanged and will be submitted alongside the Draft Charging Schedule and Proposed Modifications.

5.48 Figure 14 follows immediately after Figure 13 and provides an update on recorded sales data for 2017. This updated postcode price map also overlays the proposed Charging Zones and identifies generally the location of a number of notable recent development sites in the Borough.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 13: Price paid date Heatmap, 2016

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 14: Price paid Heatmap, 2017

Wellfield(West Park)

Scaffold HillPark) (Holystone The and The Acres The Meadows Station Road Station Road W (EastBenton Rise) Shiremoor West (Backworth Parket al)

CHARGING ZONESCHARGING

DRAFT

Billy (Darsley Pit Green) andDarsley (WhitfieldPark Green) (Moorfields)

Whitehouse Farm East Wideopen East (Five Mile Park)

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

5.49 As illustrated in the final map based on 2017 sales data, areas of development identified by have come forward recorded sales typically achieve higher value sales. The Charging Zones that have been developed and which are identified on Figure 14 reflect both variation in house prices and assessment of the nature and subsequent viability of most forms of development likely to come forward in various parts of the Borough. As such the charging zones identified include:  U0 – a lower value area in the urban area  U1 – a medium value area in the urban area  U2 – a higher value area in the urban area  R1 – a medium value area outside the existing urban area  R2 – a higher value area outside the existing urban area

Understanding sales values by floor area and location

5.50 So far this report has considered the overall housing market in North Tyneside and provided a spatial assessment of variation across the Borough. This spatial assessment informed the proposed charging zones set out within the Community Infrastructure Levy Draft Charging Schedule.

5.51 Figure 15 informs understanding of the market in North Tyneside to inform key assumptions including overall floor area, and revenue (price) per square metre and to explore any variation in those assumptions that might exist across the Borough. This data is based upon a relative same of new homes development and sales in North Tyneside, taken specifically from those properties where Land Registry Price Paid Data and Energy Performance analysis can be aligned.

5.52 In total just over 900 records of sales and Energy Performance Certificates have been analysed. The address for each record has been identified and recorded against a prospective CIL charging zone. It should be noted that in some instances where new build Greenfield development has already commenced they have been accorded an urban area charging zone in the proposed CIL. However, for the purposes of this analysis where such sites are in effect an extension of the urban area they have been assessed as if there were outside the existing urban area and therefore accorded an R1 or R2 zone.

5.53 A full schedule of the data analysed by site is available at Appendix 2 of this report.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 15: New build sales data by CIL Charging Zone / 2013 2014 2015 2016 2017 Total

R2 - 24 31 28 - 83 R1 72 67 76 66 - 281 Total U2 21 23 43 8 4 99 sales U1 31 112 187 56 2 388 U0 40 14 - - - 54 Total 164 240 337 158 6 905 R2 - 3,517 4,537 3,742 - 11,796 R1 6,293 5,967 5,660 6,766 - 24,686 Total U2 3,350 2,280 4,518 914 547 11,609 Floor U1 3,133 10,286 18,678 4,432 205 36,734 Area U0 3,547 1,052 - - - 4,599 Total 16,323 23,102 33,393 15,854 752 89,424 R2 £0 £8,795,975 £11,962,345 £10,382,860 £0 £31,141,180 R1 £12,621,839 £12,731,071 £12,840,864 £15,178,650 £0 £53,372,424 Total U2 £7,852,680 £5,563,125 £10,785,641 £2,262,600 £1,402,890 £27,866,936 Value U1 £6,206,273 £19,679,930 £39,741,894 £9,492,456 £446,795 £75,567,348 U0 £5,683,423 £1,810,155 - - - £7,493,578 Total £32,364,215 £48,580,256 £75,330,744 £37,316,566 £1,849,685 £195,441,466 R2 - £2,501 £2,637 £2,775 £0 £2,640 R1 £2,006 £2,134 £2,269 £2,243 £0 £2,162 U2 £2,344 £2,440 £2,387 £2,475 £2,565 £2,400 Average U1 £1,981 £1,913 £2,128 £2,142 £2,179 £2,057 £/sqm U0 £1,602 £1,721 - - - £1,629 Total £1,983 £2,103 £2,256 £2,354 £2,460 £2,186 Annual - 6.05% 7.27% 4.3% 4.5% increase % R2 - 147 146 134 - 142 R1 87 89 74 103 - 88 Average U2 160 99 105 114 137 117 Floor U1 101 92 100 79 103 95 Area U0 89 75 - - - 85 Total 100 96 99 100 125 99 Source: Derived from Land Registry New Build Sales Data (2013 to date) and Open Data Communities Energy Performance of Buildings https://epc.opendatacommunities.org/domestic/search

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

6 The Viability Assessment – Assumptions and Development Typology 6.1 The North Tyneside VA will appraise a range of hypothetical sites, to establish a broad understanding of development costs and values. These hypothetical sites will reflect a range of development forms in North Tyneside to develop an understanding of area wide viability.

6.2 Based on the range of information collected about the current housing market in North Tyneside and an understanding of the housing market within the Borough the following assumptions are proposed for the Viability Assessment modelling.

6.3 At this time continued adoption of the core Viability Assessment assumptions contained within the 2016 AWVA and 2017 Addendum for Technical Standards and CIL is considered most appropriate. However, on key assumptions and where available updated evidence has been collated to ensure assumptions remain reasonable and up to date. This will enable consistency in approach between each stage of the viability assessment and clear comparison in relation to the conclusions and outputs of the CIL sensitivity analysis and this update.

6.4 The following table provides a summary of the assumptions that have been employed by North Tyneside Council through its Viability Assessments.

Figure 16: Residential Appraisal Assumptions Assumption Value / Cost Update 2016 Market housing Lower = £1,900 per sqm values Medium = £2,350 per sqm Higher = £2,550 per sqm Affordable Social Rent: 2 bed £60k; 3 bed £70k housing values Affordable Rent: 2 bed £65k; 3 bed £75k (specialist wheelchair accessible, 3 bed £92k) Intermediate: 2 bed £70k; 3 bed £80k Floor area National Space Standard Private Affordable (Incorporating 1 bed flat 45 45 50 National Space 2 bed flat 65 60 65 Standards, larger 3 bed flat 80 75 80 floor area used in 2 bed house 75 65 70 appraisal where 3 bed house 89 85 90 greater) 4+ bed house 111 115 120 Larger 4+ bed house 124 150 N/A Construction For this issue of the Viability Assessment figures from BCIS Q1 2016 – rebased to North Tyneside. costs – including Flats = £1,320m2 (£1,100m2 per sqm and 15% net to gross adjustment.) contingency Houses market = £996m2 (£830m2 build cost plus 20% externals) No difference in build costs between market and affordable due to standards convergence. Accessible Homes Market and 90% Affordable Homes Affordable *Required only where Uplift per Unit Affordable Homes - 10% M4(3)2a)~ Homes - 10% specific occupier (Cost inc. - M4(2) M4(3)2b)*~ identified.

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North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Assumption Value / Cost Update 2016 additional space) ~ n.b. 10% build requirement would be 1 Bed Flat £1,229.00 £9,917.00 £10,074.00 identified as a condition 2 Bed Flat £1,196.00 £11,934.00 £12,091.00 to planning applications. 2 Bed House £1,101.00 £15,819.00 £28,303.00 Assumed that increased 3 Bed House £1,386.00 £17,238.00 £29,722.00 development cost would 4 Bed House £1,387.00 £17,499.00 £29,983.00 be reflected in increased 1 Bed Flat /m2 £27.31 £220.38 £223.87 revenue for home. 2 Bed Flat / m2 £18.40 £183.60 £186.02 2 Bed House / m2 £14.68 £210.92 £377.37 3 Bed House / m2 £15.57 £193.69 £333.96 4 Bed House / m2 £12.06 £152.17 £260.72 Applied Build Cost Houses M4(2) Flats M4(2) Affordable M4(3)2b) with 20% £1,013.61 £1,503 £1,256.72 externals and accessibility uplift s106 Contribution Schemes 400 + Homes Schemes 100+ Homes Schemes 35+ Homes Schemes 5+ Homes Total Per Unit £6,138.00 £4,111.00 £2,907.00 Sustainable Addition 2% uplift on build costs Construction Uplift Brownfield land £100,000 per hectare to cover greater risk of additional abnormal costs to development of brownfield cost uplift land. Professional and i. 10% design and professional fees finance costs ii. 3% marketing fees on private sales value iii. £500 legal fees on private sales iv. 5.5% land acquisition and stamp duty on gross residual value v. 6.5% development finance vi. 6.5% credit balance re-investment

Developers profit Market housing = 20% Affordable housing = 6% Existing Use value Greenfield/Agricultural land = £20,000 per hectare Brownfield land = £250,000 per hectare

Market Housing 6.5 From the analysis of the housing market set out through Section 4 of this report the following assumptions are applied to market housing values for the area wide viability assessment.

Figure 17 – Market housing land value assumptions Lower Value Medium Value Higher Value £ / sqm £1,900 £2,350 £2,550

Affordable Housing 6.6 Since adoption of the North Tyneside Local Plan in July 2017, the Borough seeks 25% affordable housing at all residential developments of 11 homes or more. This requirement was proposed through the North Tyneside Local Plan and found to be a sound approach to housing requirements. The policy makes specific allowance for consideration of site specific constraints or circumstances that might affect the viability of development. However, for the most part development in North Tyneside has for a number of years been successfully delivered and met the 25% requirement, as highlighted by Figure 18.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 18: Affordable Housing Delivery 2004/05 to 2011/12 Affordable Market Total (Gross) Percentage 2004/05 13 850 863 1.5% 2005/06 65 789 854 7.6% 2006/07 21 705 726 2.8% 2007/08 23 642 665 3.4% 2008/09 80 366 446 17.9% 2009/10 189 177 366 51.6% 2010/11 141 222 363 38.8% 2011/12 89 366 455 19.5% 2012/13 126 369 495 34% 2013/14 106 341 447 31% 2014/15 183 385 568 32% 2015/16 102 673 775 13% 2016/17 281 573 854 32.9% Source: North Tyneside Housing Strategy and Planning Information Monitoring

6.1 Reflecting this policy position this updated AWVA for CIL does not produce various scenarios for affordable housing mix. In each appraisal the volume of affordable is fixed at 25% of each development. The only exception to this approach is appraisals of the 5-dwelling development typology that falls below the 11 dwelling threshold established through Local Plan Policy DM4.6 Affordable Housing.

6.2 Definitions relating to affordable housing provided in the National Planning Policy Framework (March 2012) are currently under review. The likely impact of such changes appears to indicate a move towards minimum provision on larger sites and a widening of the definition of affordable housing to include Starter Homes and other means of subsidised home ownership. Such changes are assessed broadly as both widening the range of products available to meet an affordable requirement and enhancing the revenue potential for developers.

6.3 However, at this time affordable housing continues to be comprised of Social rented, affordable rented and intermediate housing, provided to eligible households whose needs are not met by the market. The approach to this viability assessment consequently is undertaken in accordance with current national policy and legislation regarding affordable homes and Local Plan policy.  Social rented guideline target rents are determined through the national rent regime.  Affordable rented subject to rent controls that require a rent of no more than 80% of the local market rent (including service charges, where applicable).  Intermediate housing is homes for sale and rent provided at a cost above social rent, but below market levels subject to the criteria in the affordable housing definition above. Products such as Discount Market value homes have not been considered as part of the affordable homes mix through the viability appraisals.

6.4 The value of social rented housing is established through guideline target rents, whilst affordable rented housing is set at 80% of market value. Whilst the current SHMA does not consider the requirements for affordable rented housing in North Tyneside it expected that this sector will be popular with registered providers due to the flexibility and returns it provides them. In general within, the approach taken to such delivery within North Tyneside

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

given the relative difference between affordable and social rents, is to welcome either tenure as a contribution to providing the 75% target for rented accommodation. The survey of 2013 indicated an average rent of £563 and a lower quartile rent of £450. A review of the evidence provided by VOA Private Rental market Statistics, March 31st 2017 indicates average mean rents in North Tyneside stood at £553 per calendar month and lower quartile rents stood at £450.

Figure 19: Social housing for rent, North Tyneside Price per tenure 1 Bed 2 Bed House 3 Bed House Ave Weekly Weekly Annual Weekly Annual Weekly Annual rent Affordability of 80% £96.37 Private Rent Affordability of Social £60 £3,100 £74 £3,842 £73.3 £4,127 £71.92 Rent Source: North Tyneside SHMA 2014 - RP rents 2011 RSR return; VOA Private Rents 2013 6.5 Through engagement with Registered Providers active within North Tyneside and the Council’s housing strategy team the following estimates for the value of intermediate affordable housing have been made.

Figure 20: Intermediate sale Average Market Value 1 bed 2 bed 3 bed 4 bed plus House n/a £70,000 £80,000 n/a Flat n/a £70,000 n/a n/a

Optional technical standards

6.6 Policy DM4.9 of the adopted Local Plan has introduced nationally described space standards (NDSS) and a proportion of accessible and adaptable homes. This requires all homes to meet NDSS and 50% of all market homes required to achieve the optional building regulation M4(2) for adaptable homes. Meanwhile, 90% of affordable homes should meet M4(2) and a further 10% would required to be M4(3)b) wheelchair accessible – if an appropriate household can be identified for the property.

Accessibility Standards 6.7 The cost uplift applied to the development appraisals is informed by the findings of the Housing Standards Review – Cost Impacts report prepared by EC Harris LLP12. The cost uplift provided in that report indicates that the basic accessible and adaptable standard M4(2) would result in a relatively modest increase in overall build costs of approximately £1,100 to £1,400 in total for houses.

6.8 Meanwhile, the more substantial requirements of wheelchair accessible and adaptable homes resulted in a cost uplift for M4(3)2b) of £28,300 to nearly £30,000 per unit depending upon number of bedrooms. This highest standard requires a specifically identified household occupier and is only included within Local Plan policy as required for 10% of affordable homes, with a fall back to M4(3)2a) otherwise. Due to the specialised nature of these homes and the additional support likely to be available to the household discussions

1.1 12https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/353387/021c_Cost_Report_11th_Sept_2014_FINAL.pdf

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

with Registered Providers have indicated that a value premium could be applied to such affordable homes.

Nationally described space standards 6.9 The application of the Technical Optional Standard for Nationally Described Space Standards (NDSS)13 as set out in Table 1 below.

Figure 21: Nationally Described Space Standards – Gross Internal Area (sq. metres) Number of 1 person 2 person 3 person 4 person 5 person 6 Person 7 Person 8 Person Average Bedrooms 1 Bed Flat 39 50 ------45 2 Bed Flat - - 61 70 - - - 65 2 Bed House - - 70 79 - - - - 75 3 Bed Flat - - - 74 86 - - - 80 3 Bed House - - - 84 93 - - - 89 4 Bed House - - - - 97 106 115 124 111 4+ Bed House 110 121 130 124

6.10 Analysis within the Housing Optional Technical Standards Update14 report prepared by Capita North Tyneside in June 2016 indicated that current developments of 2 bed and 3 bed houses in particular fell below the Gross Internal Area identified by the NDSS. For two bed homes in particular prepared for Market Sale the GIA of buildings is typically at least 10sqm below the NDSS.

6.11 In undertaking Viability Assessments to establish the impact of space standards the additional floor area influences both the build cost and revenue as both elements are considered on a £ per square metre basis. Table 2 outlines the estimated total purchase price based upon the Higher (£2,500/sq metre), Medium (£2,350/sq metre) and Lower (£1,900/sq metre) price bands included in the Area Wide Viability Assessment.

Figure 22: Impact of Space Standards upon House Prices £/m2 Number of 1 person 2 person 3 person 4 person 5 person 6 Person 7 Person 8 Person Average Bedrooms £2,5k 1 Bed Flat £99,450 £127,500 ------£114,750 £2,3k 1 Bed Flat £91,650 £117,500 ------£105,750 £1,9k 1 Bed Flat £74,100 £95,000 ------£85,500 £2,5k 2 Bed Flat - - £155,550 £178,500 - - - - £165,750 £2,3k 2 Bed Flat - - £143,350 £164,500 - - - - £152,750 £1,9k 2 Bed Flat - - £115,900 £133,000 - - - - £123,500 £2,5k 2 Bed House - - £178,500 £201,450 - - - - £191,250 £2,3k 2 Bed House - - £164,500 £185,650 - - - - £176,250 £1,9k 2 Bed House - - £133,000 £150,100 - - - - £142,500 £2,5k 3 Bed Flat - - - £188,700 £219,300 - - - £204,000 £2,3k 3 Bed Flat - - - £173,900 £202,100 - - - £188,000 £1,9k 3 Bed Flat - - - £140,600 £163,400 - - - £152,000 £2,5k 3 Bed House - - - £214,200 £237,150 - - - £226,950 £2,3k 3 Bed House - - - £197,400 £218,550 - - - £209,150 £1,9k 3 Bed House - - - £159,600 £176,700 - - - £169,100

1.1 13 Technical housing standards – nationally described space standard, DCLG, March 2015 14 Housing – Optional Technical Standards Update, Capita North Tyneside, June 2016

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

£/m2 Number of 1 person 2 person 3 person 4 person 5 person 6 Person 7 Person 8 Person Average Bedrooms £2,5k 4 Bed House - - - - £247,350 £270,300 £293,250 £316,200 £283,050 £2,3k 4 Bed House - - - - £227,950 £249,100 £270,250 £291,400 £260,850 £1,9k 4 Bed House - - - - £184,300 £201,400 £218,500 £235,600 £210,900 £2,5k 4+ Bed - - - - - £280,500 £308,550 £331,500 £316,200 House £2,3k 4+ Bed - - - - - £258,500 £284,350 £305,500 £291,400 House £1,9k 4+ Bed - - - - - £209,000 £229,900 £247,000 £235,600 House

6.12 As such the impact of increasing the size of a two bed home from approximately 65sq metres to a 75 sq metre average has the effect of increasing the price of the home in a low value area by £19,000 in a low value area and £25,550 in a high value area.

Construction Costs 6.13 The previous AWVA have been based upon a construction cost established through Building Cost Information Service (BCIS) from Q1 2016. An analysis of the index of Tender Prices for Residential build identifies that there has been inflation in build costs since that time. This index is highlighted at Figure 23 below:

Figure 23: BCIS Private Housing Construction Price Index Date Index Status Percentage change on year 2013 168 2.4%

2014 179 Firm 6.5% 2015 189 Firm 5.6% 2016 196 Firm 3.7% 2017 205 Provisional 4.6% Base: 1998 mean = 100 Last updated: 12-Mar-2018 Downloaded: 30-Apr-2018 12:50 Source: BCIS

Figure 24: Annual increase in new build house price revenue in North Tyneside 2013 2014 2015 2016 2017

Annual increase % - 6.05% 7.27% 4.3% 4.5% Source: Land registry Price Paid Data, North Tyneside

6.1 As can be seen over the period since 2016 annual percentage increase in build costs have been 3.7% and 4.6%. Meanwhile, over this period Figure 24 has illustrated that sales revenue per square metre in North Tyneside has similarly increased by 4.3% and 4.5%. it is consequently considered that update to the latest house prices and build costs is not necessary to ensure a reasonable and robust calculation of development viability.

Sustainable Construction - Zero Carbon Homes and Energy Efficiency 6.2 The Government has expressed its committed to ensuring all new homes are ‘zero carbon’ from 2016. In April 2014 changes to Part L of the Building Regulations were introduced raising overall standards for sustainable construction. For new homes, the changes deliver a 6% improvement on 2010 standards across the build mix.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

6.3 Similarly a strengthening of carbon dioxide targets for new non-domestic buildings deliver a 9% improvement on 2010 standards aggregated across the build mix. Further changes are proposed from 2016 in line with the zero carbon agenda.

6.4 In March 2014 the Government confirmed its intention to wind down the Code for Sustainable Homes and to consolidate technical standards. These will similarly result in changes to the Building Regulations. The emerging approach is one of providing scope for Local Authorities within their Local Plans to set out specific local standards for construction where they are clearly based on a justified need to set standards that differ from those established nationally.

6.5 Attributing a cost to these enhanced building standards is complex. Improved efficiencies will achieve cost savings in respect of the running expense of new development and therefore may attract a premium in the sales price. In addition, as technology progresses and inclusion of sustainability standards as part of construction become commercial in scale, the relative costs of such measures will decline.

6.6 Analysis provided by the Zero Carbon Hub “Cost Analysis: meeting the zero carbon standard, February 2014”15 outlined a range of estimated costs for achieving zero carbon homes. Figure 25 below provides an illustration of estimated additional cost for the construction of a zero carbon home.

Figure 25: Cost above Part L1A 2013 for achieving the Zero Carbon Standard for different house types via lowest cost route Element Detached house Semi-detached Mid-terraced Low-rise house house apartment Per home Fees £1,728 £61 -£76 -£32 Heating and LZC technology £3,270 £2,824 £2,477 £978 Carbon compliance £4,998 £2,885 £2,401 £947 Allowable solutions £2,118 £1,504 £1,508 £1,375 Total (central) £7,116 £4,389 £3,910 £2,322 Range £6,700-£7,500 £4,100-£4,700 £3,700-£4,200 £2,200-£2,400 Per m2 Fees £15 £1 -£1 £0 Heating and LZC technology £28 £37 £32 £18 Carbon compliance £42 £38 £31 £18 Allowable solutions £18 £20 £20 £25 Total (central) £60 £58 £51 £43 Range £57-£64 £54-£62 £48-£55 £42-£44 Zero Carbon Hub – Costs Analysis 2014

6.7 Compared to estimated build costs arising from BCIS the above table suggests an uplift of between 5% and 7% above part L1A of the Building Regulations, to achieve zero carbon 1.1 15 Zero Carbon Hub “Cost Analysis http://www.zerocarbonhub.org/sites/default/files/resources/reports/Cost_Analysis- Meeting_the_Zero_Carbon_Standard.pdf

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

homes. The estimates considered here represent the lowest cost route set out by the Zero carbon hub to achieving zero carbon. A range of alternative scenarios also exist based on alternative methods of reducing carbon emissions.

6.8 Through development of the Local Plan requirements, for implementing zero carbon and the implications for build costs will be kept up to date. At this time there are clear additional costs associated with these increasing standards and to enable some consideration of the implications, an additional appraisal will be undertaken incorporating an assumed premium of 2% on BCIS build costs.

Site Infrastructure Costs 6.9 An additional allowance to take account of additional site infrastructure costs for external works is included. This will typically be calculated at 10% of the build costs.

Brownfield Land Cost Burden 6.10 To allow the development appraisals to reflect the typical picture of the potential costs arising from sites, whilst not having the ability to consider the specific circumstances and requirements of sites, an additional cost uplift of £100,000 per hectare has been included for Brownfield land.

6.11 This uplift is based on an acknowledgement of the increased risk of issues such as contamination or site clearance that could arise from Brownfield development. Whilst Greenfield land can also require significant additional funding simply to make them appropriate for development the risk is reduced.

Professional and Finance Costs 6.12 The assumptions for profession fees and development costs have been applied as follows based on industry standards:

 10% professional fees  3% marketing fees on private sales value  £500 legal fees on private sales  5.5% land acquisition and stamp duty on gross residual value  6.5% development finance  6.5% credit balance re-investment

Planning Obligations 6.13 North Tyneside Council maintains an ongoing and up to date assessment of planning obligations secured through section 106 agreements. An overview of obligations secured through s106 has been provided at section 4 of this report. The Council has determined that the following thresholds and contributions per unit represent the reasonable average cost of section 106 contributions. The following table sets out the overall rang of planning contributions sought from schemes.

Figure 26: Planning Contributions Monitoring Size of development Total s106 Number of Average per Number of Average per collected dwellings dwelling market dwellings market dwelling 5+ dwellings £325,462 228 £1,427 216 £1,507

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Size of development Total s106 Number of Average per Number of Average per collected dwellings dwelling market dwellings market dwelling 35+ dwellings £2,412,046 850 £2,838 941 £2,563 100+ dwellings £7,695,921 1957 £3,933 1738 £4,428 400+ dwellings £12,955,200 3083 £4,202 2146 £6,037

Land Value Assumptions 6.14 A key element of the residual land value methodology is to establish that the value of the development is greater than the cost of developing the site plus the value of the land or benchmarked value.

6.15 It is also the case that for the value of the development to simply exceed the existing use of the land would in most circumstances not be sufficient to incentivise the landowner to release the land for development. This is central to the understanding of viability and deliverability in the context of the NPPF that establishes viability is dependent on a willing landowner and willing developer. In such circumstances both parties would expect a reasonable return.

6.16 Within guidance on undertaking viability assessments, the approach set out by the Local Housing Delivery Group is based on an assessment of Existing Use Values, with the existing use value of land subject to a percentage uplift or premium. The approach taken therefore looks at an Existing Use Value of £20,000 per hectare for agricultural land and £300,000 per hectare of existing brownfield land.

6.17 Applying the approach adopted through the Killingworth Moor and Murton Gap Project Viability and Delivery Report for greenfield land uplifts upon existing use value for agricultural land of between 20 and 30 times have been viewed as providing a deliverable site. This would establish a threshold land value of approximately £600,000 per hectare for agricultural land. For brownfield sites an overall uplift of about three times existing use value has been considered an appropriate uplift to realise a deliverable site. This would equate to a threshold land value of approximately £900,000 per hectare.

Developers Profit 6.18 The HCA Development Appraisal Tool assumes developer profit on gross development value. Throughout the Area Wide Viability Assessment process developers profit has been set at 20% for market housing and 6% for affordable housing. However, the site specific Murton and Killingworth Project Viability and Delivery report set profit on market housing for those two sites at 18%.

Housing Mix 6.19 In determining the mix of house types and sizes a range of sources have been used including review of recent developments, and the mix of housing requirements identified by the Strategic Housing Market Assessment 2015. Through the annual monitoring of housing delivery the mix of house sizes set out in Figure 27 have been provided over the past six years.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 27: Recorded house completions by bedroom size 1 Bed Flat 2 Bed Flat 3 Bed Flat 4+ Bed 1 Bed 2 Bed 3 Bed 4+ Bed Flat House House House House 2016/17 424 151 21 0 8 134 234 289 2015/16 122 73 0 0 1 97 149 180 2014/15 11 41 1 0 0 99 160 200 2013/14 19 105 2 0 0 46 119 89 2012/13 28 76 0 0 2 28 152 128 2011/12 5 66 1 0 10 54 184 60 2010/11 0 21 0 0 0 72 161 59 2009/10 0 159 0 0 0 25 93 35 Total 52 427 3 0 12 225 709 371 % 3% 24% 0% 0% 0.5% 13% 39.5% 20% NTC Annual Information Monitoring Figure 28: Suggested annual profile of new dwellings based on current stock profile, aspirations and expectations Dwelling Type Current stock % Profile of new dwelling stock based on: Like Expect House 1/2 Beds 13.4% 12.4% 17.8% House 3 Beds 41.2% 35.5% 35.9% House 4 or more Beds 19.6% 25.0% 14.0% Bungalow 7.2% 18.9% 13.8% Flat 18.1% 7.3% 17.1% Other 0.4% 0.8% 1.4% Total 100% 100% 100% North Tyneside Strategic Housing Market Assessment 2015

6.20 Within the North Tyneside Strategic Housing Market Assessment 2015 analysis of household types, and the expectations and aspirations of those planning to move the following profile of housing size is provided.

6.21 From the above tables greatest current housing delivery are two bed flats, and three and four bed homes. Analysis from the SHMA clearly illustrates that, except for flats, these are also amongst the house types sought most by respondents. Within the development typologies below the range of house sizes set out seek to take account of previous feedback provided by developers to the type of homes they are likely to deliver, the current mix of housing delivery and the evidence of the SHMA.

6.22 It should be noted that as the distribution of actually development sites over the local plan period will not be uniform across the development typologies these do not provide an outline of the overall mix of housing types and size expected to be delivered in the borough.

Development Typology 6.23 The following development typologies have been employed for undertaking the AWVA CIL sensitivity. Each of these development typologies are appraised in a theoretical greenfield location and brownfield location – adjusted appropriately in terms of Equivalent Use Value and additional abnormal costs.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 29: Development typology mix Tenure Housing type Number % Number % Strategic Not Accessible Accessible Market 2 Bed 15 8% 15 8% 3 Bed 75 38% 75 38% 4 Bed 50 25% 50 25% Larger 4 Bed 10 5% 10 5% Sub total 150 75% 150 75% Affordable 2 Bed Rent 23 12% 22 11% 3 Bed Rent 15 8% 10 5% 2 bed Shared Ownership 7 4% 8 4% 3 Bed Shared Ownership 5 3% 5 3% 3 Bed Rent Wheelchair Accessible 0 0% 5 3% Sub total 50 25% 50 25% All 200 100% 200 100% Major Not Accessible Accessible Market 2 Bed 4 4% 4 4% 3 Bed 19 19% 18 18% 4 Bed 13 13% 12 12% Larger 4 Bed 2 2% 3 3% Sub total 38 38% 37 37% Affordable 2 Bed Rent 5 5% 5 5% 3 Bed Rent 5 5% 3 3% 2 bed Shared Ownership 2 2% 1 1% 3 Bed Shared Ownership 1 1% 2 2% 3 Bed Rent Wheelchair Accessible 0 0% 1 1% Sub total 13 13% 12 12% All 51 51% 49 49% Medium Not Accessible Accessible Market 2 Bed 2 6% 1 3% 3 Bed 6 17% 7 20% 4 Bed 4 11% 4 11% Larger 4 Bed 1 3% 1 3% Sub total 13 37% 13 37% Affordable 2 Bed Rent 2 6% 1 3% 3 Bed Rent 2 6% 2 6% 2 bed Shared Ownership 1 3% 0 0% 3 Bed Shared Ownership 1 3% 0 0% 3 Bed Rent Wheelchair Accessible 0 0% 0 0% Sub total 6 17% 3 9% All 19 54% 16 46% Small Not Accessible Accessible Market 2 Bed 0 0% 0 0% 3 Bed 3 21% 4 29% 4 Bed 2 14% 2 14% Larger 4 Bed 0 0% 0 0% Sub total 5 36% 6 43% Affordable 2 Bed Rent 0 0% 0 0% 3 Bed Rent 0 0% 3 21% 2 bed Shared Ownership 0 0% 0 0% 3 Bed Shared Ownership 0 0% 0 0% 3 Bed Rent Wheelchair Accessible 0 0% 0 0% Sub total 0 0% 3 21% All 5 36% 9 64% 5-Dwellings Not Accessible Accessible Market 2 Bed 0 0% 0 0% 3 Bed 0 0% 3 60% 4 Bed 0 0% 2 40% Larger 4 Bed 0 0% 0 0% Sub total 0 0% 0 0% Affordable 2 Bed Rent 0 0% 0 0%

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Tenure Housing type Number % Number % 3 Bed Rent 0 0% 0 0% 2 bed Shared Ownership 0 0% 0 0% 3 Bed Shared Ownership 0 0% 0 0% 3 Bed Rent Wheelchair Accessible 0 0% 0 0% Sub total 0 0% 0 0% All 0 0% 5 100%

6.24 Appendix 3 provides a further analysis of some of the major developments in the area with detailed evidence regarding house types and mix.

Main modifications – additional development typology 6.25 To further inform the approach proposed within the submitted CIL Draft Charging Schedule and Main Modifications, further analysis and appraisal has been undertaken targeted specifically at understanding the impact upon viability of the Strategic Allocations of Murton Gap and Killingworth Moor.

6.26 It is recognised that due to the scale of these sites they represent a major potential source of contribution towards overall CIL revenue and ensuring that the specific impacts are understood.

6.27 The Murton Gap and Killingworth Moor Project Viability and Delivery Report16 identified the development typology set out at Figure 30 below.

Figure 30: Strategic Sites Development Typology (average market dwellings floor area 116sqm) No. of units No of units Size (m2) House Type Tenure/Phase Sales Valuation Murton Gap Killingworth Moor 10 8 65 2 Bed House Open Market Build phase 1 £150,000 347 290 90 3 Bed House Open Market Build phase 1 £210,000 408 340 140 4 Bed + House Open Market Build phase 1 £325,000 110 80 65 2 Bed House Affordable Rent phase 1 £65,000 81 79 85 3 Bed House Affordable Rent phase 1 £75,000 34 27 65 2 Bed House Shared Ownership phase 1 £70,000 30 26 85 3 Bed House Shared Ownership phase 1 £80,000 7 6 65 2 Bed House Open Market Build phase 2 £150,000 247 221 90 3 Bed House Open Market Build phase 2 £210,000 291 260 140 4 Bed + House Open Market Build phase 2 £325,000 75 63 65 2 Bed House Affordable Rent phase 2 £65,000 61 59 85 3 Bed House Affordable Rent phase 2 £75,000 25 22 65 2 Bed House Shared Ownership phase 2 £70,000 20 19 85 3 Bed House Shared Ownership phase 2 £80,000 12 5 65 2 Bed House Open Market Build phase 3 £150,000 427 170 90 3 Bed House Open Market Build phase 3 £210,000 502 200 140 4 Bed + House Open Market Build phase 3 £325,000 135 47 65 2 Bed House Affordable Rent phase 3 £65,000 100 47 85 3 Bed House Affordable Rent phase 3 £75,000 48 16 65 2 Bed House Shared Ownership phase 3 £70,000 30 15 85 3 Bed House Shared Ownership phase 3 £80,000

6.1 This proposed development mix resulted in an average floor area for market homes of approximately 116sqm. Application of the Therefore to additionally test the proposed 1.1 16 http://www.northtyneside.gov.uk/pls/portal/NTC_PSCM.PSCM_Web.download?p_ID=565839

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018 average floor area submitted in response to the Local Plan an analysis of viability based upon an average floor area of 105sqm has also been considered, as set out in Figure 31 below.

Figure 31: Strategic Sites Development Typology (amended average market dwellings floor area to 105sqm) No. of units No. of units Size (m2) House Type Tenure/Phase Sales Valuation Murton Gap Killingworth Moor 12 8 65 2 Bed House Open Market Build phase 1 £150,000 435 290 90 3 Bed House Open Market Build phase 1 £210,000 510 340 140 4 Bed + House Open Market Build phase 1 £325,000 120 80 65 2 Bed House Affordable Rent phase 1 £65,000 119 79 85 3 Bed House Affordable Rent phase 1 £75,000 41 27 65 2 Bed House Shared Ownership phase 1 £70,000 39 26 85 3 Bed House Shared Ownership phase 1 £80,000 9 6 65 2 Bed House Open Market Build phase 2 £150,000 332 221 90 3 Bed House Open Market Build phase 2 £210,000 390 260 140 4 Bed + House Open Market Build phase 2 £325,000 95 63 65 2 Bed House Affordable Rent phase 2 £65,000 89 59 85 3 Bed House Affordable Rent phase 2 £75,000 33 22 65 2 Bed House Shared Ownership phase 2 £70,000 29 19 85 3 Bed House Shared Ownership phase 2 £80,000 8 5 65 2 Bed House Open Market Build phase 3 £150,000 255 170 90 3 Bed House Open Market Build phase 3 £210,000 300 200 140 4 Bed + House Open Market Build phase 3 £325,000 71 47 65 2 Bed House Affordable Rent phase 3 £65,000 71 47 85 3 Bed House Affordable Rent phase 3 £75,000 24 16 65 2 Bed House Shared Ownership phase 3 £70,000 23 15 85 3 Bed House Shared Ownership phase 3 £80,000

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

7 Benchmarking the AWVA 7.1 As part of the 2016 AWVA update a series of site specific assessment of actual development sites was undertaken. The assumptions and findings from this assessment are provided with the 2016 AWVA submitted along with this 2018 AWVA to support the CIL Draft Charging Schedule and Proposed Modifications. The purpose of this benchmarking assessment was to test the results achieved against known sites that have been delivered in North Tyneside in recent years These development appraisals are adjusted based upon the site areas and development mix approved under the relevant planning applications, and the level of section 106 and other highway costs otherwise estimated. For all other key assumptions the costs and values set out in the summary of AWVA assumptions are utilised. The table below at Figure 32 outlines the conclusions from these appraisals.

Figure 32: Actual development sites benchmarking summary Sites and key assumptions Residual Residual / Ha

Whitehouse Farm £2,350m2 revenue, £996m2 build costs, Off-site affordable (22ha), 367 £22,970,068 (52.11 x EUV) £1,042,199 units Whitehouse Farm £22,574,838 £2,350m2 revenue, £1014m2 M4(2) build cost, Off-site affordable (22ha) £1,024,267 (51.21 x EUV) 367 units Scaffold Hill £2,350m2 revenue, £996m2 build cost, 25% affordable, (20.39ha country £19,372,557 (47.51 x EUV) £950,101 park not included) 460 units Scaffold Hill (58.88 x EUV with £1,177,670 (based on £2,350m2 revenue, £996m2 build cost, 25% affordable, (20.39ha country purchase circa £24m DAT purchase price) park not included) 460 units residual -£6,094,323) Scaffold Hill £2,350m2 revenue, £1014m2 build cost, 25% affordable (10% M4(3)2b) £18,256,109 (44.77 x EUV) £895,346 £1,257m2, (20.39ha country park not included,) 460 units Land at Great Lime Road, Forest Gate £2,350m2 revenue, £996m2 build cost, 25% affordable , (1.78ha) 61 units £2,797,580 (78.58 x EUV) £1,571,674

Land at Great Lime Road, Forest Gate (98.34 x EUV with £1,966,854 (Based on £2,350m2 revenue, £996m2 build cost, 25% affordable, (1.78ha) 61 units purchase circa £3.5m DAT purchase price) residual -£915,409) Land at Great Lime Road, Forest Gate £2,350m2 revenue, £1014m2 build cost, 25% affordable (10% M4(3)2b) £2,661,808 (74.77 x EUV) £1,495,398 £1,257m2) (1.78ha) 61 units Hadrian Education Centre (demolition of buildings) £2,209,829 (3.55 x EUV) £982,146 £2,350m2 revenue, £996m2 build cost, 25% affordable (2.49ha) 66 units Hadrian Education Centre (demolition of buildings) £2,350m2 revenue, (3.59 x EUV with purchase £994,289 (Based on £996m2 build cost, 25% affordable, (2.49ha) 66 units circa £2.2m / DAT residual purchase price) £162,783) Hadrian Education Centre (demolition of buildings) £2,350m2 revenue, £1014m2 build cost, 25% affordable (10% M4(3)2b) 2,066,939 (3.32 x EUV) £918,640 £1,257m2), (2.49ha) 66 units Parkside School (demolition of buildings) £421,850 £201,842 £1,900m2 revenue, £996m2 build cost, 25% affordable, (2.09ha) 69 units ( 0.81 x EUV) Parkside School (demolition of buildings) (2.87 x EUV with purchase £717,703 (Based on £1,900m2 revenue, £996m2 build cost, 25% affordable, (2.09ha) 69 units circa £1.5m / DAT residual purchase price) -£1,219,090) Parkside School (demolition of buildings) £1,900m2 revenue, £1014m2 build cost, 25% affordable (10% M4(3)2b) £270,809 (0.52 x EUV) £129,574 £1,257m2), (2.09ha) 69 units

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Sites and key assumptions Residual Residual / Ha

St Stephens (demolition of buildings) £1,900m2 revenue, £996m2 build cost,25% affordable, (0.96ha) 41 units £232,048 (0.97 x EUV) £222,766

St Stephens (demolition of buildings) £1,900m2 revenue, £1014m2 build cost, 25% affordable (10% M4(3)2b) £158,955 (0.66 x EUV) £152,597 £1,257m2), (0.96ha) 41 units Norgas House (demolition of office) £2,350/m2 revenue, £996/m2 build cost homes, £1,320/m2 build cost £3,777,848 (5.72 x EUV) £1,428,838 flats, 20% affordable (fixed sales at £80k flats, £85k homes), (2.64ha) 119 units Norgas House (demolition of office) £2,350 & £2,086/m2 revenue, £996/m2 build cost homes, £1,320/m2 build £3,060,832 £1,157,652 cost flats, 20% affordable (fixed sales at £80k flats, £85k homes), Build size (4.63 x EUV) increased from 79 to 89m2) (2.64ha) 119 units. Norgas House (demolition of office), £2,350 & £2,086/m2 revenue, £1014/m2 build cost homes, £1,500/m2 £2,709,542 £1,024,789 build cost flats, 20% affordable (fixed sales at £80k flats, £85k homes),3 (4.10 x EUV) bed size increased from 79 to 89m2) (2.64ha) 119 units

7.2 The results indicate that larger schemes such as Scaffold Hill and Whitehouse Farm achieve an uplift of approximately 50 times agricultural land value (an EUV of £20,000 per hectare). Site 114 Land at Great Lime Road exhibits a greater EUV uplift of approximately 78 times agricultural land value. Based upon the EPC and Land Registry Data collated at Appendix 2 average revenue per square metre at this site is approximately £2,300. This is marginally lower than the modelled medium sales value of £2,350 per square metre.

Results for the brownfield sites considered exhibit significantly lower multipliers as can be expected with the additional cost assumption applied to brownfield development and the greater EUV assumed per hectare. Within medium value area with standard build costs applied Hadrian Education Centre achieved an uplift of over 3 times EUV. Based upon land registry and EPC data recorded sales averaged approximately £2,282 per square metre. Meanwhile, both Parkside School and St Stephens School sites in the lower value band returned at less than existing use value at 0.81 and 0.97 respectively.

7.3 It is notable that for all of the above sites the resultant residual value when applying the standard assumptions to the DAT model was lower than the recorded price paid for the land. Revenues applied per square metre appear robust. It may therefore be possible that the assumed costs upon development, after highway and section 106 contributions, are higher than the burden upon development in practice.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

8 Residential Appraisal Outcomes

Greenfield Appraisals

8.1 The following tables set out the conclusions of sensitivity testing potential CIL rates and alternative s106 contributions upon the residual value and uplift achieved against Existing Use Value.

Strategic Development Sites 8.2 The following table summarises results for the Strategic Development Typology in a greenfield location. This is a mixed 400 dwelling development type providing 25% affordable housing.

8.3 The distribution of this scale of development is expected to lie almost exclusively outside the existing urban area of North Tyneside. There is considered to be no probability of a greenfield development of over 10 hectares coming forward within the urban area In all but the most exceptional circumstances.

Figure 33: Strategic Development Typology – Existing Use Value £350,000 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

Strategic, higher value £2,550/m2

£6,138 £2,455,200 £0 £130 £2,376,000 £11,597,749 £859,093 32.2 £6,138 £2,455,200 £0 £115 £3,415,500 £11,947,867 £885,027 33.2 £6,138 £2,455,200 £0 £100 £2,821,500 £12,297,985 £910,962 34.2 £6,138 £2,455,200 £0 £80 £2,376,000 £12,764,809 £945,541 35.5 £6,138 £2,455,200 £0 £55 £1,633,500 £13,348,338 £988,766 37.1 £6,138 £2,455,200 £0 £0 £0 £14,632,104 £1,083,860 40.6 Strategic, medium value £2,350/m2

£6,138 £2,455,200 £0 £55 £1,633,500 £9,908,175 £733,939 27.5 £6,138 £2,455,200 £0 £0 £0 £11,191,784 £829,021 31.1 £4,604 £1,841,200 £1,535 £55 £1,633,500 £10,390,717 £769,683 28.9 £3,453 £1,381,040 £2,685 £55 £1,633,500 £10,752,359 £796,471 29.9 £2,589 £1,381,040 £3,549 £80 £2,376,000 £10,440,150 £773,344 29.0 £1,942 £776,840 £4,196 £80 £2,376,000 £10,643,668 £788,420 29.6 Strategic, lower value £1,900/m2

£6,138 £2,455,200 £0 £0 £0 £3,263,587 £241,747 9.1 £4,604 £1,841,400 £1,535 £55 £1,633,500 £2,462,206 £182,386 6.8 £3,453 £1,381,040 £2,685 £55 £1,633,500 £2,824,003 £209,185 7.8 £2,589 £1,035,800 £3,549 £55 £1,633,500 £3,095,326 £229,283 8.6 £1,942 £776,840 £4,196 £55 £1,633,500 £3,298,843 £244,359 9.2

8.4 The Table 6 above identifies that across the “Higher value” band this development typology enables a sufficient uplift against EUV to prove viable even with the addition of a CIL charge

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

of £130 per square metre and the retention of the estimated average s106 contribution of £6,138 dwellings per unit.

8.5 Moving to the “Medium value” band significantly impacts viability. At this revenue, uplift against EUV of approximately 30x with an £80 per square metre CIL requires s106 o reduce to less than £2,000 per unit. At a CIL charge of £55 per square metre the deduction required to s106 to achieve approximately 30x EUV is less significant with approximately £3,500 per unit retained for s106 contributions per unit.

8.6 Uplift against EUV for the “Lower value” band is significantly reduced. The base uplift against EUV with the standard application of a s106 £6,138 is 9.1x. Inclusion of CIL at a £55 rate per square metre and reduction s106 to £3,500 per unit results in an uplift of 7.8x.

8.7 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

Major development sites 8.8 The following table summarises results for the Major Development Typology in a greenfield location. This is a mixed 100 dwelling development type providing 25% affordable housing.

8.9 The distribution of this scale of development is considered most likely at locations that lie outside the existing urban area. Relatively few areas of greenfield land, that could be considered potentially suitable for residential development, exist within the urban area.

Figure 34: Major Development Typology – Existing Use Value £90,000 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

Major, higher value £2,550/m2

£5,139 £513,800 -£1,028 £130 £964,340 £2,901,803 £853,471 32.2 £4,111 £411,100 £0 £130 £964,340 £2,987,572 £878,698 33.2 £4,111 £411,100 £0 £115 £853,070 £3,080,498 £906,029 34.2 £4,111 £411,100 £0 £100 £741,800 £3,173,424 £933,360 35.3 £4,111 £411,100 £0 £80 £593,440 £3,297,326 £969,802 36.6 £4,111 £411,100 £0 £0 £0 £3,792,932 £1,115,568 42.1 Major, medium value £2,350/m2

£4,111 £411,100 £0 £55 £407,990 £2,578,123 £758,271 28.6 £4,111 £411,100 £0 £0 £0 £2,918,852 £858,486 32.4 £3,083 £308,320 £1,028 £55 £407,990 £2,663,959 £783,517 29.6 £2,312 £231,240 £1,799 £55 £407,990 £2,728,331 £802,450 30.3 £1,734 £173,430 £2,377 £80 £593,440 £2,621,734 £771,098 29.1 £1,301 £130,000 £2,810 £80 £593,440 £2,658,004 £781,766 29.5 Major, lower value £1,900/m2

£4,111 £411,100 £0 £20 £148,360 £776,990 £228,526 8.6 £4,111 £411,100 £0 £0 £0 £900,825 £264,949 10.0

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

£3,083 £308,300 £1,028 £20 £148,360 £862,843 £253,777 9.6 £2,312 £231,240 £1,799 £20 £148,360 £927,199 £272,706 10.3 £1,301 £130,000 £2,810 £55 £407,990 £794,921 £233,800 8.8 £1,301 £130,000 £2,810 £20 £148,360 £1,038,890 £305,556 11.5 £1,301 £130,000 £2,810 £15 £111,270 £1,042,724 £306,684 11.6 £976 £97,500 £3,135 £55 £407,990 £822,063 £241,783 9.1

8.10 The Table 7 above identifies that across the “Higher value” band this development typology enables a sufficient uplift against EUV to prove viable even with the addition of a CIL charge of £130 per square metre and the retention of the estimated average s106 contribution of £4,111 dwellings per unit. Indeed it is demonstrated that a greater s106 contribution could be secured whilst continuing to provide a reasonable uplift for a landowner.

8.11 At the “Medium value” band an uplift against EUV of approximately 30x with an £80 per square metre CIL requires reduction of s106 contributions per unit to less than £1,500. At a CIL charge of £55 per square metre the deduction required to s106 to achieve approximately 30x EUV is less significant with approximately £3,000 to 2,300 per unit retained for s106 contributions per unit.

8.12 Uplift against EUV for the “Lower value” band is significantly reduced. The base uplift against EUV with a s106 contribution of £4,111 is 10.0x. In this lower value band a £55 CIL charge only approaches an equivalent EUV uplift to the baseline position with a reduction in s106 contributions to approximately £1,000 per unit.

8.13 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

Medium development sites 8.14 The following Table 8 summarises results for the Medium Development Typology in a greenfield location. This is a mixed 35 dwelling development type providing 25% affordable housing.

8.15 The distribution of this scale of sites in a greenfield setting could remain varied and take place both within and outside the urban area. However, it is considered that the smaller scale of this development typology means the Council can expect most developments of this nature to take place on suitable sites within the existing built up areas of the Borough.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 35: Medium Development Typology – Existing Use Value £30,000 s106 per Total s106 Deduction CIL CIL Charge Residual Residual / EUV Dwelling costs against Rate Ha Uplift baseline s106

Medium, higher value £2,550/m2 £2,907 £101,745 £0 £130 £334,100 £1,063,842 £941,453 35.5 £2,907 £101,745 £0 £115 £295,550 £1,098,369 £972,008 36.6 £2,907 £101,745 £0 £100 £257,000 £1,132,896 £1,002,563 37.8 £2,907 £101,745 £0 £80 £205,600 £1,178,933 £1,043,304 39.3 £2,907 £101,745 £0 £0 £0 £1,363,078 £1,206,264 45.4 Medium, medium value £2,350/m2 £2,907 £101,745 £0 £55 £141,350 £914,444 £809,242 30.5 £2,907 £101,745 £0 £0 £0 £1,041,044 £921,278 34.7 £2,180 £76,307 £727 £55 £141,350 £936,355 £828,633 31.2 £1,635 £57,231 £1,272 £80 £205,600 £895,240 £792,248 29.8 £1,635 £57,231 £1,272 £55 £141,350 £952,785 £843,173 31.8 £1,226 £42,920 £1,681 £80 £205,600 £907,566 £803,156 30.3 Medium, lower value £1,900/m2 £2,907 £101,745 £0 £0 £0 £295,869 £261,831 9.9 £1,635 £57,231 £1,272 £55 £141,350 £207,609 £183,725 6.9 £1,226 £42,920 £1,681 £55 £141,350 £219,938 £311,311 7.3 £1,226 £42,920 £1,681 £20 £51,400 £300,000 £222,436 10.0 £1,226 £42,920 £1,681 £15 £38,550 £312,011 £276,116 10.4 £920 £59,130 £1,987 £55 £141,350 £229,182 £202,816 7.6

8.16 The Table 8 above identifies that across the “Higher value” band this development typology enables a sufficient uplift against EUV to prove viable even with the addition of a CIL charge of £130 per square metre and the retention of the estimated average s106 contribution of £2,907 dwellings per unit.

8.17 At the “Medium value” band an uplift against EUV of approximately 30x with an £80 per square metre CIL requires reduction of s106 contributions per unit to less than £1,500. At a CIL charge of £55 per square metre the deduction required to s106 to achieve approximately 30x EUV is less significant with approximately £2,000 per unit retained for s106 contributions.

8.18 Uplift against EUV for the “Lower value” band is significantly reduced. The base uplift against EUV with a s106 contribution of £2,907 is 9.9x. In this lower value band a £55 CIL remains lower than this equivalent rate even where s106 contributions are reduced below £1,000 per unit. Application of the lower £15 and £20 CIL charges enable EUV uplifts of approximately 10x EUV whilst retaining over £1,200 per unit s106 contribution.

8.19 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

8.20 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

Small Development Typology 8.21 The following Table 9 summarises results for the Small Development Typology in a greenfield location. This is a mixed 14 dwelling development type providing 25% affordable housing.

8.22 The distribution of this scale of site is considered most likely in small greenfield locations within the existing urban area – although the potential for such sites to come forward at other locations is acknowledged.

Figure 36: Small Development Typology – Existing Use Value £17,000 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

Small, higher value £2,550/m2

£939 £13,146 £0 £115 £122,705 £497,851 £905,184 29.3 £939 £13,146 £0 £100 £106,700 £512,186 £931,247 30.1 £939 £13,146 £0 £80 £85,360 £531,299 £965,998 31.3 £939 £101,745 £0 £0 £0 £607,752 £1,105,004 35.8 Small, medium value £2,350/m2

£939 £13,146 £0 £55 £53,845 £408,662 £743,022 24.0 £939 £13,146 £0 £0 £0 £461,223 £838,587 27.1 £704 £9,859 £235 £55 £53,845 £411,493 £748,169 24.2 £704 £9,859 £235 £20 £21,340 £444,944 £808,989 26.2 £528 £7,392 £411 £55 £53,845 £413,618 £752,033 24.3 £528 £7,392 £411 £20 £21,340 £447,066 £812,847 26.3 £528 £9,859 £411 £15 £16,005 £451,844 £821,535 26.6 £396 £5,544 £543 £15 £16,005 £453,436 £824,429 26.7 Small, lower value £1,900/m2

£939 £13,146 £0 £0 £0 £131,533 £239,151 7.7 £396 £5,544 £543 £55 £53,845 £85,520 £155,491 5.0 £396 £5,544 £543 £20 £21,340 £118,968 £216,305 7.0 £396 £5,544 £543 £15 £16,005 £123,746 £224,993 7.3 £396 £5,544 £543 £0 £0 £138,081 £251,056 8.1 £297 £4,158 £642 £55 £53,845 £86,713 £157,660 5.1 £0 £0 £939 £0 £0 £142,856 £259,738 8.4

8.23 The Table 9 above identifies that across the “Higher value” band this development typology enables a sufficient uplift against EUV to prove viable even with the addition of a CIL charge of £115 per square metre and the retention of the estimated average s106 contribution of £939 dwellings per unit. The overall uplift for this development typology is reduced compared to larger schemes.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

8.24 At the “Medium value” band an uplift against EUV of 27.1 is achieved with no CIL charge. With introduction of CIL reduction of the s106 sought to approximately £500 to £700 enables retention of an EUV uplift of over 26x EUV at a lower £15 and £20 rate. However, a s106 contribution of less than £500 per unit would be required to enable viable application of a £55 per square metre CIL charge.

8.25 Uplift against EUV for the “Lower value” band is significantly reduced. The base uplift against EUV with a s106 contribution of £939 is 7.7. In this lower value band a £55 CIL has a relatively large impact even where s106 contributions per unit are reduced to below £300 per unit – at this rate an EUV of 5.1x is recorded. Consequently a lower CIL rate of £20 to £15 with a s106 contribution reduced to about £400 achieves a broadly equivalent uplift of 7x EUV but remains at best marginal in terms of providing a reasonable return to a landowner. For this lower value band a zero charge for both CIL and s106 achieves an uplift of 8.4x, which remains marginal a marginal return for a landowner.

8.26 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

5 Dwellings Development Sites 8.27 The following Table 10 summarises results for the 5 Dwelling Development Typology in a greenfield location. This is a 3 and 4 bed development of 5 dwellings with no affordable housing provision – falling below the affordable housing threshold of 11 units.

8.28 The distribution of this scale of sites in a greenfield setting is most likely on suitable sites within the existing built up area of the Borough.

Figure 37: 5 Dwellings Development Typology – Existing Use Value £4,250 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106 5 dwellings, higher value £2,550/m2

£500 £2,500 £0 £130 £63,570 £235,172 £1,383,365 55.3 £500 £2,500 £0 £115 £56,235 £241,741 £1,422,006 56.9 £500 £2,500 £0 £100 £48,900 £248,311 £1,460,653 58.4 £500 £2,500 £0 £80 £39,120 £257,070 £1,512,176 60.5 £500 £2,500 £0 £0 £0 £292,108 £1,718,282 68.7 5 dwellings, medium value £2,350/m2

£500 £2,500 £0 £80 £39,120 £189,917 £1,117,159 44.7 £500 £2,500 £0 £55 £29,395 £200,866 £1,181,565 47.3 £500 £2,500 £0 £20 £9,780 £216,195 £1,271,735 50.9 £500 £2,500 £0 £15 £7,335 £218,385 £1,284,618 51.4 £500 £2,500 £0 £0 £0 £224,955 £1,323,265 52.9 5 dwellings, lower value £1,900/m2

£500 £2,500 £0 £80 £39,120 £38,822 £228,365 9.1 £500 £2,500 £0 £55 £29,395 £49,771 £292,771 11.7

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

£500 £2,500 £0 £20 £9,780 £65,100 £382,941 15.3 £500 £2,500 £0 £15 £7,335 £67,290 £395,824 15.8 £500 £2,500 £0 £0 £0 £73,860 £434,471 17.4 £375 £1,875 £125 £55 £29,395 £50,310 £295,941 11.8 £375 £1,875 £125 £20 £9,780 £65,639 £386,112 15.4 £375 £1,875 £125 £15 £7,335 £67,829 £398,994 16.0

8.29 It is notable across all value bands that this development type reflects a significant improvement in return for landowners compared to the previously considered development typologies. In terms of density of development the typology is broadly similar at approximately 30 dwellings per hectare. However, the exclusion of the affordable homes policy requirement may significant enhance the uplift achieved.

8.30 Across both higher and medium value bands this typology achieves healthy returns against EUV, whilst even at the lowest value band the uplift achieved is notably improved if still marginal overall.

Strategic Allocations

8.31 The following tables at Figure 38 and Figure 39 draw initially upon the findings from the Murton and Killingworth Project Viability and Delivery Report. The strategic allocations are major developments with a range of additional infrastructure including open space, strategic transport and education provision to be accommodated on site. In total the development area of each site is expected to equate to approximately 50% of the total allocated area.

8.32 Within the Project Viability and Delivery Report assumptions were made regarding the relevant gross development area against which the land value per hectare and subsequent uplift would be considered. Figure 38 provides updated results and further sensitivity analysis of the impacts of amending the mix of development and the proposed CIL charging rates. Meanwhile, to allow further comparison with other development typologies an assessment of land value based upon net development area – derived from an assessment of land area required to provide the allocated homes at 27 dwellings per hectare.

Figure 38: Strategic Allocations Results Summary based upon gross developable area (Murton, 155ha, Killingworth 107ha) Site EUV Residual Multiplier Price/ S106/S278 CIL Total Land Value gross ha Costs contributions Murton – 2016 £3,106,200 £91,000,000 29.3 £585,924 £33,046,989 £0.00 £33,046,989 assessment Murton (with CIL at £3,106,200 £88,000,000 28.3 £566,608 £20,345,680 £17,967,369 £38,313,049 £68.7per sqm) Murton (market floor £3,106,200 £87,500,000 28.2 £563,389 £33,046,989 £0.00 £33,046,989 area revised to 105sqm with 2 bed at 75sqm Murton (market floor £3,106,200 £86,500,000 27.8 £556,950 £20,345,680 £16,222,185 £36,567,865 area revised to 105sqm with 2 bed at 75sqm) (With CIL at £68.6per

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Site EUV Residual Multiplier Price/ S106/S278 CIL Total Land Value gross ha Costs contributions sqm) (M1) Murton (market £3,106,200 £90,900,000 29.3 £585,281 £20,345,680 £11,114,325 £31,460,005 floor area revised to 105sqm with 2 bed at 75sqm) (With CIL at £47per sqm) Killingworth 2016 £2,140,000 £66,500,000 31.1 £621,495 £25,324,267 £0.00 £25,324,267 assessment Killingworth (with CIL at £2,140,000 £64,750,000 30.3 £605,140 £16,283,197 £12,007,320 £28,290,517 £68.7 per sqm) Killingworth (market floor £2,140,000 £55,500,000 25.9 £518,691 £25,324,267 £0.00 £25,324,267 area revised to 105sqm with 2 bed at 75sqm) Killingworth (market floor £2,140,000 £54,300,000 25.4 £507,476 £16,283,197 £10,814,447 £27,097,644 area revised to 105sqm with 2 bed at 75sqm)(with CIL at £68.7 per sqm) (K1) Killingworth (market £2,140,000 £56,300,000 26.3 £526,168 £16,283,197 £7,409,315 £23,692,512 floor area revised to 105sqm)(with CIL at £47 per sqm)

Figure 39: Strategic Allocations Results Summary based upon net developable area (Murton, 111ha: Killingworth, 74ha) Site EUV Residual Multiplier Price/ net S106/S278 CIL Total Land Value ha Costs contributions (M1) Murton £2,220,000 £91,000,000 41.0 £819,819 £33,046,989 £0.00 £33,046,989 (M1) Murton (with CIL at £2,220,000 £88,000,000 39.6 £792,792 £20,345,680 £17,967,369 £38,313,049 £68.7per sqm (M1) Murton (market £2,220,000 £87,500,000 39.4 £788,288 £33,046,989 £0.00 £33,046,989 floor area revised to 105sqm with 2 bed at 75sqm (M1) Murton (market £2,220,000 £86,500,000 39.0 £779,279 £20,345,680 £16,222,185 £36,567,865 floor area revised to 105sqm with 2 bed at 75sqm) (With CIL at £68.6per sqm) (M1) Murton (market £2,220,000 £90,900,000 40.9 £818,918 £20,345,680 £11,114,325 £31,460,005 floor area revised to 105sqm with 2 bed at 75sqm) (With CIL at £47per sqm) (K1) Killingworth £1,480,000 £66,500,000 44.9 £898,648 £25,324,267 £0.00 £25,324,267 (K1) Killingworth (with CIL £1,480,000 £64,750,000 43.8 £875,000 £16,283,197 £12,007,320 £28,290,517 at £68.7 per sqm) (K1) Killingworth (market £1,480,000 £55,500,000 37.5 £750,000 £25,324,267 £0.00 £25,324,267 floor area revised to 105sqm with 2 bed at 75sqm) (K1) Killingworth (market £1,480,000 £54,300,000 36.7 £733,783 £16,283,197 £10,814,447 £27,097,644 floor area revised to 105sqm with 2 bed at 75sqm)(with CIL at £68.7 per sqm) (K1) Killingworth (market £1,480,000 £56,300,000 38.0 £760,810 £16,283,197 £7,409,315 £23,692,512 floor area revised to 105sqm)(with CIL at £47 per sqm)

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

It is apparent that the adjustment firstly in average floor area has a substantial effect upon the residual land value. Meanwhile, for both Murton and Killingworth the proposed CIL rate may reduce the overall uplift secured against EUV.

Greenfield assessment summary 8.33 Overall the Council has indicated that it will seek a viable CIL rate that continues to enable appropriate collection of s106 to avoid harm to the collection of appropriate funds to address the planning impacts of development.

8.34 From the analysis of results provided at Greenfield locations it is apparent that where development is in higher value bands there is significant scope for greater developer contributions. However, the Council consider a precautionary principle should be applied and it would prove potentially harmful to overall delivery of housing to take an approach that significantly increased the cost burden upon development on the assumption that it would come forward at a higher value rate.

8.35 However, it is generally considered that for the larger Strategic, Major and to a lesser extent Medium development typology a CIL rate of £47 to £69 would not harm viable delivery where s106 contributions are reduced by approximately 30% to 40%.

8.36 In the Small development typology the impact of reduced scale whilst continuing to contribute to other policy costs such as affordable housing further impact upon development. More typically for these Medium and Small development typologies a CIL charge of £15 to £20 can be sustained with a reduction of s106 contributions of approximately 30%.

8.37 Typically for the lower value band it is noted that spatially the evidence available to the Council demonstrates that the lowest revenues are most likely within the urban area where fewer opportunities exist for larger greenfield development. It is more likely that smaller developments within the urban area would fall within this value band, whilst larger developments would come forward outside the urban area in medium and higher value bands.

Brownfield Appraisals 8.38 The following tables set out the conclusions of sensitivity testing potential CIL rates and alternative s106 contributions upon the residual value and uplift achieved against Existing Use Value.

8.39 In general it has been determined through previous North Tyneside Area Wide Viability Assessments and the Strategic Allocations Site Specific Project Viability Assessments that for Brownfield sites a land value uplift of at least 2 to 3 times Existing Use Value (EUV) represents a reasonable return.

Strategic Development Sites 8.40 The following table summarises results for the Strategic Development Typology in a brownfield location. This is a mixed 400 dwelling development type providing 25%

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

affordable housing. The distribution of this scale of development is expected to lie within the existing urban area of North Tyneside and most typically represent the redevelopment of older cleared or derelict areas of brownfield land. Appropriate additional costs are included for this development typology to account for additional potential abnormal and remediation costs.

Figure 40: Strategic Development Typology – Existing Use Value £3,375,000 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

Strategic, higher value £2,550/m2

£6,138 £2,455,200 £0 £130 £2,376,000 £10,382,026 £769,039 3.1 £6,138 £2,455,200 £0 £115 £3,415,500 £10,732,143 £794,974 3.2 £6,138 £2,455,200 £0 £100 £2,821,500 £11,082,261 £820,908 3.3 £6,138 £2,455,200 £0 £80 £2,376,000 £11,549,085 £855,488 3.4 £6,138 £2,455,200 £0 £55 £1,633,500 £12,132,615 £898,712 3.6 Strategic, medium value £2,350/m2

£6,138 £2,455,200 £0 £0 £0 £9,976,217 £738,979 3.0 £6,138 £2,455,200 £0 £55 £1,633,500 £8,692,452 £643,885 2.6 £4,604 £1,841,200 £1,535 £55 £1,633,500 £9,174,836 £679,617 2.7 £3,453 £1,381,040 £2,685 £55 £1,633,500 £9,536,633 £706,417 2.8 £2,589 £1,381,040 £3,549 £80 £2,376,000 £9,224,458 £683,293 2.7 £1,942 £776,840 £4,196 £80 £2,376,000 £9,427,974 £698,368 2.8 Strategic, lower value £1,900/m2

£6,138 £2,455,200 £0 £0 £0 £2,047,864 £151,694 0.9 £4,604 £1,841,400 £1,535 £55 £1,633,500 £1,246,483 £92,332 0.4 £3,453 £1,381,040 £2,685 £55 £1,633,500 £1,608,279 £119,132 0.5 £2,589 £1,035,800 £3,549 £20 £594,000 £2,696,576 £199,746 0.8 £2,589 £1,035,800 £3,549 £15 £445,500 £2,813,282 £208,391 0.8 £2,589 £1,035,800 £3,549 £55 £1,633,500 £1,879,634 £139,232 0.6 £1,942 £776,840 £4,196 £20 £594,000 £2,900,061 £214,819 0.9 £1,942 £776,840 £4,196 £15 £445,500 £3,016,767 £223,464 0.9 £1,942 £776,840 £4,196 £55 £1,633,500 £2,083,119 £154,305 0.6

8.41 Delivery of a brownfield development in the higher and medium value bands exhibits a strong uplift against EUV with a baseline uplift for delivery in a medium value band with no CIL charge of 3.0x. A CIL charge up to £130 per square metre is potentially viable in the highest value bands whilst a reduction in s106 to £3,500 results in a reasonable uplift and minimal reduction in the viability of development for a £55 per square metre charge.

8.42 The viability of brownfield development in lower value locations is considerably reduced and falls below Existing Use Value where a full s106 charge is raised. Under the scenarios tested using alternative CIL and s106 rates even the lower £15 per square metre charge requires a reduction of s106 contributions from £6,138 to under £2,000 per unit.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

8.43 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

Major Development Sites 8.44 The following table summarises results for the Major Development Typology in a brownfield location. This is a mixed 100 dwelling development type providing 25% affordable housing. The distribution of this scale of development is again considered most likely at locations within the existing urban area.

Figure 41: Major Development Typology – Existing Use Value £850,000 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

Major, higher value £2,550/m2

£5,139 £513,800 -£1,028 £130 £964,340 £2,595,562 £763,401 3.1 £4,111 £411,100 £0 £130 £964,340 £2,681,390 £788,644 3.2 £4,111 £411,100 £0 £115 £853,070 £2,774,316 £815,975 3.3 £4,111 £411,100 £0 £100 £741,800 £2,867,242 £843,306 3.4 £4,111 £411,100 £0 £80 £593,440 £2,991,144 £879,748 3.5 Major, medium value £2,350/m2

£4,111 £411,100 £0 £0 £0 £2,612,670 £768,432 3.1 £4,111 £411,100 £0 £55 £407,990 £2,271,941 £668,218 2.7 £3,083 £308,320 £1,028 £55 £407,990 £2,357,776 £693,464 2.8 £2,312 £231,240 £1,799 £55 £407,990 £2,422,149 £712,397 2.8 £1,734 £173,430 £2,377 £80 £593,440 £2,315,552 £681,045 2.7 £1,301 £130,000 £2,810 £80 £593,440 £2,351,763 £691,695 2.8 Major, lower value £1,900/m2

£4,111 £411,100 £0 £20 £148,360 £470,808 £138,473 0.6 £4,111 £411,800 £0 £0 £0 £594,710 £174,915 0.7 £3,083 £308,300 £1,028 £20 £148,360 £556,644 £163,719 0.7 £2,312 £231,240 £1,799 £20 £148,360 £621,016 £182,652 0.7 £1,301 £130,000 £2,810 £55 £407,990 £488,738 £143,746 0.6 £1,301 £130,000 £2,810 £20 £148,360 £705,508 £207,502 0.8 £1,301 £130,000 £2,810 £15 £111,270 £736,483 £216,613 0.9 £1,000 £100,000 £3,111 £0 £0 £854,522 £251,330 1.0 £976 £97,500 £3,135 £55 £407,990 £515,839 £151,717 0.6

8.45 Delivery of a brownfield development in the higher and medium value bands exhibits a strong uplift against EUV with a baseline uplift for delivery in a medium value band with no CIL charge of 3.1x. A CIL charge up to £130 per square metre and even additional s106 contributions is potentially viable in the highest value bands. A reduction in s106 to approximately £2,000 results in a reasonable uplift and minimal reduction in the viability of development for a £55 per square metre CIL charge.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

8.46 The viability of brownfield development in lower value locations is considerably reduced and falls below Existing Use Value. Under the scenarios tested using alternative CIL and s106 rates the lower £15 per square metre charge requires a reduction of s106 contributions from £4,111 to under £1,500 per unit. A return for the landowner equivalent to EUV is achieved where there is no CIL charge and s106 contributions are reduced to £1,000 per unit.

8.47 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

Medium Development Sites 8.48 The following Figure 42 summarises results for the Small Development Typology in a brownfield location. This is a mixed 35 dwelling development type providing 25% affordable housing. The distribution of this scale of site is considered most likely in brownfield locations within the existing urban area, although the potential for smaller areas of brownfield redevelopment of this scale outside the urban area is also noted.

Figure 42: Medium Development Typology – Existing Use Value £282,500 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

Medium, higher value £2,550/m2

£2,907 £101,745 £0 £130 £334,100 £962,081 £851,399 3.4 £2,907 £101,745 £0 £115 £295,550 £996,608 £881,954 3.5 £2,907 £101,745 £0 £100 £257,000 £1,031,136 £912,510 3.7 £2,907 £101,745 £0 £80 £205,600 £1,077,172 £953,250 3.8 Medium, medium value £2,350/m2

£2,907 £101,745 £0 £0 £0 £948,239 £839,051 3.4 £2,907 £101,745 £0 £55 £141,350 £821,528 £727,016 2.9 £2,907 £24 £2,907 £19 £2,180 £76,307 £727 £55 £141,350 £843,445 £746,412 3.0 £1,635 £57,231 £1,272 £80 £205,600 £802,329 £710,026 2.8 £1,635 £57,231 £1,272 £55 £141,350 £859,874 £760,950 3.0 £1,226 £42,920 £1,681 £80 £205,600 £814,659 £720,937 2.9 Medium, lower value £1,900/m2

£2,907 £101,745 £0 £0 £0 £194,108 £171,777 0.7 £1,635 £57,231 £1,272 £55 £141,350 £105,855 £93,677 0.4 £1,226 £42,920 £1,681 £55 £141,350 £118,179 £311,311 0.4 £1,226 £42,920 £1,681 £20 £51,400 £198,743 £222,436 0.7 £1,226 £42,920 £1,681 £15 £38,550 £210,252 £186,064 0.7 £920 £32,186 £1,987 £55 £141,350 £127,422 £112,763 0.5 £920 £42,920 £1,987 £15 £38,550 £219,495 £194,243 0.8

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

8.49 Delivery of a brownfield development in the higher and medium value bands exhibits a strong uplift against EUV with a baseline uplift for delivery in a medium value band with no CIL charge of 3.1x. A CIL charge up to £130 per square metre is viable in the highest value bands. A reduction in s106 to approximately £2,000 results in a reasonable uplift and minimal reduction in the viability of development for a £55 per square metre CIL charge.

8.50 The viability of brownfield development in lower value locations is considerably reduced and falls below Existing Use Value. Under the scenarios tested using alternative CIL and s106 rates the lower £15 per square metre charge requires a reduction of s106 contributions from £2,907 to approximately £1,000 per unit to match the baseline return where no CIL is applied but still remains below EUV. A return for the landowner equivalent to EUV is achieved where there is no CIL charge and s106 contributions are reduced to £1,000 per unit.

8.51 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

Small Development Sites 8.52 The following Figure 43 summarises results for the Small Development Typology in a brownfield location. This is a mixed 14 dwelling development type providing 25% affordable housing. The distribution of this scale of site is considered most likely on suitable sites within the existing built up area of the Borough although the potential for such development on smaller previously developed locations outside the urban area is noted.

Figure 43: Small Development Typology – Existing Use Value £137,500 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

Small, higher value £2,550/m2

£939 £13,146 £0 £115 £122,705 £407,797 £741,449 3.0 £939 £13,146 £0 £100 £106,700 £422,132 £767,513 3.1 £939 £13,146 £0 £80 £85,360 £441,245 £802,264 3.2 Small, medium value £2,350/m2

£939 £13,146 £0 £80 £85,360 £335,241 £609,529 2.4 £939 £13,146 £0 £0 £0 £371,169 £674,853 2.7 £939 £13,146 £0 £55 £53,845 £357,558 £650,105 2.6 £704 £9,859 £235 £55 £53,845 £360,389 £655,253 2.6 £704 £9,859 £235 £20 £21,340 £393,837 £716,067 2.9 £528 £7,392 £411 £55 £53,845 £362,514 £659,116 2.6 £528 £7,392 £411 £20 £21,340 £395,962 £719,931 2.9 £528 £9,859 £411 £15 £16,005 £400,740 £728,618 2.9 £396 £5,544 £543 £15 £16,005 £402,332 £731,513 2.9 Small, lower value £1,900/m2

£396 £5,544 £543 £0 £0 £88,551 £161,002 0.6 £396 £5,544 £543 £55 £53,845 £35,990 £65,436 0.3

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

£396 £5,544 £543 £20 £21,340 £69,438 £126,251 0.5 £396 £5,544 £543 £15 £16,005 £74,217 £134,940 0.5 £297 £4,158 £642 £55 £53,845 £37,184 £67,607 0.3 £0 £0 £939 £0 £0 £93,327 £169,685 0.7

8.53 Delivery of a brownfield development in the higher and medium value bands exhibits a reasonable uplift against EUV with a baseline uplift for delivery in a medium value band with no CIL charge of 2.7x. A CIL charge up to £115 per square metre is viable in the highest value bands whilst maintaining an uplift of 3.0x EUV. A reduction in s106 to approximately £600 would result in a reasonable uplift and minimal reduction in the viability of development for a £55 per square metre CIL charge.

8.54 The viability of brownfield development in lower value locations is considerably reduced and falls below Existing Use Value even where no CIL charge of s106 is applied.

8.55 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

5 Dwellings Development Site 8.56 The following Figure 44 summarises results for the 5 Dwelling Development Typology in a brownfield location. This is a 3 and 4 bed development of 5 dwellings with no affordable housing provision – falling below the affordable housing threshold of 11 units. The distribution of this scale of sites in a brownfield setting is most likely on suitable sites within the existing built up area of the Borough although the potential for such development on smaller previously developed locations outside the urban area is noted.

Figure 44: 5 Dwellings Development Typology – Existing Use Value £42,500 s106 per Total s106 Deduction CIL Rate CIL Charge Residual Residual / EUV Dwelling costs against Ha Uplift baseline s106

5 dwellings, higher value £2,550/m2

£500 £2,500 £0 £130 £63,570 £219,863 £1,293,312 5.2 £500 £2,500 £0 £115 £56,235 £226,432 £1,331,953 5.3 £500 £2,500 £0 £100 £48,900 £233,002 £1,370,600 5.5 £500 £2,500 £0 £80 £39,120 £241,761 £1,422,124 5.7 5 dwellings, medium value £2,350/m2

£500 £2,500 £0 £80 £39,120 £174,608 £1,027,106 4.1 £500 £2,500 £0 £55 £29,395 £185,557 £1,091,512 4.4 £500 £2,500 £0 £20 £9,780 £200,886 £1,181,682 4.7 £500 £2,500 £0 £15 £7,335 £203,076 £1,194,565 4.8 £500 £2,500 £0 £0 £0 £209,646 £1,233,212 4.9

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

5 dwellings, lower value £1,900/m2

£500 £2,500 £0 £80 £39,120 £23,026 £135,447 0.5 £500 £2,500 £0 £55 £29,395 £33,976 £199,859 0.8 £500 £2,500 £0 £20 £9,780 £49,305 £290,029 1.2 £500 £2,500 £0 £15 £7,335 £51,494 £302,906 1.2 £500 £2,500 £0 £0 £0 £58,064 £341,553 1.4 £375 £1,875 £125 £55 £29,395 £34,514 £203,024 0.8 £375 £1,875 £125 £20 £9,780 £49,843 £293,194 1.2 £375 £1,875 £125 £15 £7,335 £52,033 £306,076 1.2

8.57 Again for this development type it is notable across all value bands that this development type benefits from a significant improvement in return for landowners compared to the previously considered development typologies. For Higher and Medium value bands the returns achieved would enable an £80 per square metre contribution and a £500 per unit s106 contribution.

8.58 Across both higher and medium value bands this typology achieves healthy returns against EUV, whilst even at the lowest value band the uplift achieved is notably improved but only remains greater than EUV at the £15 and £20 per square metre CIL rates.

8.59 The proposed modification would reduce an £80 per square metre charge to £68.60 and a £55 per square metre charge to £47. Meanwhile proposed charging rates within the urban area remain unchanged.

Brownfield Assessment Summary 8.60 Overall the Council has indicated that it will seek a viable CIL rate that continues to enable appropriate collection of s106 to avoid harm to the collection of appropriate funds to address the planning impacts of development.

8.61 From the analysis of results provided at Brownfield locations it is apparent that where development is in higher value bands there is significant scope for greater developer contributions. However, the Council consider a precautionary principle should be applied and consider of the nature and distribution of brownfield land in North Tyneside would indicate that it falls more generally in medium and lower value areas associated with older industrial development and town centre locations. Meanwhile most development opportunities for higher value brownfield development are limited to smaller infill sites to the east of the Borough and smaller areas to the west and north of the urban area.

8.62 It is therefore considered that within the urban area, where the majority of brownfield development would come forward, schemes will typically fall within value bands between the lower and medium range. The results of the summary undertaken demonstrate that significant challenges to viable development exist at the lower value band. In such areas to maintain a broadly equivalent impact upon EUV application of a £15 to £20 per square metre CIL charge with a s106 charge per unit set at between 40% and 60% of baseline rates.

Residential Appraisals Conclusions

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

8.63 The results of this viability appraisal sensitivity assessment have been considered to establish an understanding of the degree to which the baseline estimate of s106 contributions might be adjusted to allow for a proportion of developer contributions to be secured through s106. It has considered how the nature of development sites and relationship to the housing market influences the viability of development and the options for charging a CIL rate whilst securing an appropriate estimate of s106 contributions to address the planning impacts of developments. In summary the outcome of the appraisals is outlined in Figure 45.

Figure 45: Residential appraisal summary conclusions Typology Location Potential CIL Rate Proportion of baseline s106 Larger greenfield Outside urban area £47 to £68 per square 50% to 70% (Strategic, Major, Medium and metre Strategic Allocations) Smaller greenfield Mixed – predominantly within £15 to £20 per square 70% (Medium, Small, 5 Dwellings) the urban area metre Larger brownfield Within urban area £15 to £20 per square 40% to 60% (Strategic, Major, Medium) metre and Zero rate in lowest value areas Smaller brownfield Mixed – predominantly within £15 to £20 per square 40% to 60% the urban area metre and Zero rate in lowest value areas

8.64 From this analysis and conclusions therefore five basic charging zones are supported, informed by the nature of the development anticipated and relative value band. With reference to the Residential Sales Values it is possible to accord these charging zones to the locations identified as follows in Figure 46 below.

Figure 46: Potential CIL Charging Zones Zone Location Urban Area Zero Rate (U0) Based upon the lower value areas within the urban area. Focused in general to the south of the A1058 and associated with older town centre locations and former employment land. Urban Area 1 (U1) The broad extent of the residential area of North Tyneside generally understood to represent a strong housing market but where opportunity is restricted to smaller brownfield and greenfield infill developments. Urban Area 2 (U2) Limited to locations identified as higher value sales areas predominantly located to the east of the Borough. Remaining Area 1 (R1) The areas outside the predominantly urban area. Largely agricultural land but washes over some areas of brownfield land. Remaining Area 2 (R2) Those locations outside the urban area directly within and adjacent to areas of higher value sales.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

9 Commercial Development Appraisal

9.1 Within North Tyneside, there are a number of large successful commercial sites, such as Silverlink Retail Park, Cobalt Business Park, Quorum Business Park, and also some significant development sites in the pipeline, such as Indigo Park, Swan Hunter and Northumberland Park. These sites have the potential to be very successful; however there will be limited demand for new speculative developments outside of these primary sites within the Borough.

9.2 The table below outlines the assumptions that have been used in developing the commercial typologies. They are meant to represent typical new developments in the Borough, although are likely to be subject to significant fluctuation even within a Borough as small as North Tyneside. After considering the Gross Development Value and Gross Development cost, we have looked at whether a reasonable return can be provided to both the landowner and developer in order for the schemes to be considered viable.

9.3 A reasonable return to the developer has been assumed to be 20% of the Gross Development cost on most property types. The current economic market provides great risk and uncertainty. The amount of speculative development across all property types has dramatically reduced in the last decade. A developer is now very unlikely to undertake commercial development unless they can be confident that they will be able to find an end user and/or purchaser, along with achieving that level of profit. Lenders will also require this confidence in order to be able to provide lending facilities.

9.4 A reasonable return for the landowner has been assessed on the basis of whether a threshold land value can be achieved. This has been considered on a price per hectare basis, and this does vary across property types – retail land is worth more than industrial land for instance.

Commercial Typology and Assumptions

Figure 47: Commercial Development Typology and Assumptions Supermarket Retail Retail Warehouse Industrial Office Hotel & Restaurant parade Size 2,323 920 323 929 13,470 60 beds (sq m) 566m2 restaurant Site Area (ha) 0.75 0.2 0.75 0.2 0.6 0.2 Rent (per sq m) £200 £188 £290 £65 £ 172 £4,000/ room £160 Restaurant Rent free period 6 months 12 months 12 months 3 months 6 months 6 months Yield 6% 8% 7% 8% 7% 6%

Build Cost (per sq m) £1,244 £804 £1,615 £52 £1,404 £45,000/ room £1,643 Restaurant Land Value (£ per ha) £1,5m £1,5m £1,5m £250k £750k £1m

9.5 Evidence has been taken from a variety of sources, including published indices (eg BCIS), commercial property databases (CoStar), evidence from real life development appraisals, industry standards and discussion with developers and other professionals, and the writer’s own knowledge.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

9.6 General Assumptions  For each appraisal the following general assumptions were made:  External works were calculated at up to 20% of the construction cost.  Professional fees were up to 10% of the build costs  Stamp duty was calculated using the HMRC stamp duty calculator  Purchaser’s costs were at 4-6%  The finance has been calculated at a rate of between 5 – 6%

Commercial Appraisal Outcomes

Industrial 9.7 This development was based upon a new single warehouse of 929 sq m with the need for new infrastructure. Based on the assumptions adopted and a land cost of £250,000 per hectare the proposed development would not provide the required return to the developer.

9.8 This is not unexpected given the lack of speculative industrial development within the local and regional market, which highlights the challenges of making such schemes financially viable. However, Indigo Park demonstrates how developers would now be taking schemes of this nature forward through marketing the site for end users first.

9.9 Once an end user is secured, then the development becomes a lot safer, which would result in a drop in yield and ensure that a reasonable return can be provided to the developer.

9.10 A large scheme of this nature is also only likely to go ahead if external funding can be obtained in order to obtain the large scale infrastructure required for the development. No CIL has been requested or tested on industrial typologies.

Supermarket 9.11 We have assumed a development similar in scale to the Aldi supermarket development at Foxhunters Road and have adopted a site area of 0.75 hectares which is apportioned equally between the structure and onsite car parking.

9.12 An appropriate developers profit for a scheme of this nature is considered to be 20% profit on development cost.

9.13 Based on a land cost of £1,250,000 and the assumptions contained within the appraisal the proposed development would turn out a profit which we believe would be sufficient to developers including a contribution of £20m2 for CIL.

9.14 As supermarkets provide a more secure end user than a retail warehouse, then developers may be willing to lower their profit expectations still further to ensure that the scheme is deliverable.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Figure 48: Supermarket appraisal summary (updated 2017/18 based upon DAT Model) Site EUV Residual Multiplier Price/ gross S106/S278 CIL Land Value ha Costs Supermarket (Greenfield) £15,000 £1,049,236 69.9 £1,398,981 £0 £0 Supermarket (Greenfield) with £10 CIL £15,000 £1,026,217 68.4 £1,368,289 £0 £23,230 Supermarket (Greenfield) with £20 CIL £15,000 £1,003,198 66.9 £1,337,597 £0 £46,460 Supermarket (Greenfield) with £10 CIL £15,000 £1,189,281 79.3 £1,585,708 £0 £23,230 (Developer profit reduced to 17%) Supermarket (Greenfield) with £10 CIL £15,000 £1,164,600 77.6 £1,552,800 £25,000 £23,200 (Developer profit reduced to 17%) Supermarket at 1,440sqm gross area £10,000 £650,409 65.0 £1,300,818 £0 £0.00 (Greenfield) Supermarket at 1,440sqm gross area (Greenfield) with £10 CIL (Developer profit £10,000 £732,757 73.3 £1,465,514 £25,000 £14,400 reduced to 17%)

Retail Parade 9.15 The appraisal for this development was based upon a similar scheme to that of Northumberland Park providing 12 retail units with associated car parking.

9.16 Again an appropriate developers profit on cost is thought to be 20%. Based on a land cost of £300,000 equating to £1,500,000 per ha and the assumptions contained within the appraisal the proposed development would provide a profit on cost of 21%. This is very much on the margins of viability, and would be subject to the location within the Borough.

9.17 There are unlikely to be options for new retail centres in existing locations, which limits them to new retail centres in new developments of significant numbers i.e. 2,000 dwellings plus. Even then, as demonstrated by Northumberland Park, demand can be slow and a developer must account for significant void and rent free periods. A relatively low rate of CIL of up to £5 per square metre is relatively small and doesn’t have a material effect on the viability of this typology.

Retail Warehouse 9.18 We have based a scheme on the new development currently being constructed adjacent to Silverlink Retail Park and have used this as a guide to the assumptions made within our own appraisal.

9.19 Based on a land cost of £1,150,000 and the assumptions made the proposed development would provide a profit on cost of 20.33%. With a CIL rate included, the profit is still within the 30% range, therefore it appears reasonable to assume that the CIL rate for Zones B & C is viable. Again, this is at the margins of viability, and would therefore be subject to significant risk if developed speculatively without an end user or within the existing main retail park at Silverlink.

Office 9.20 We have assumed an office development of similar specification to the Cobalt Business Park totalling 13,470 sqm. Office development within the region remains very difficult without significant subsidy or tax advantages due to low rental values and relatively poor occupier demand. Based on a land cost of £450,000 and the assumptions contained within the appraisal the proposed development would provide a low profit on cost.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

9.21 Without being developed on one of the two existing primary office parks in the Borough (Cobalt and Quorum), and without significant external funding support, there is unlikely to be any speculative development of this nature. However, a relatively low CIL charge of circa £5 per metre square makes a very negligible difference to the viability of the scheme, therefore it could not be said that CIL makes the scheme any more unviable than without it.

Hotel 9.22 We have assumed a development similar to the new Premier Inn hotel and associated restaurant development in Whitley Bay. Based on a land value of £1,000,000 per hectare, this provides a developer’s return of 18% with the CIL rate included.

9.23 Locations less attractive than Whitley Bay sea front are likely to struggle to achieve similar returns for developer profit. Again, ensuring a pre-let may see a developer willing to lower their expected return or result in less stringent borrowing restrictions. There will be limited demand for new hotel accommodation in the Borough, therefore development is unlikely to proceed speculatively, and would only proceed once a pre-let is in place. Therefore the risk to a developer would be relatively low.

Conclusions 9.24 These are the most common development types that we currently see in the Borough, although of course there may occasionally be other development types as well. However as all of the above typologies are on the margins of being able to deliver reasonable returns, any other riskier, less common developments are also likely to struggle to deliver a surplus.

9.25 Therefore it is very unlikely that any significant S106 contributions will be deliverable from commercial development in the Region over and above the suggested CIL rates, unless essential to the delivery of the scheme.

North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Appendices

Appendix 1: Funding secured through S106 Contributions by site Site / Description Planning reference Dwellings Affordable housing S106 agreed S016 per Relevant CIL Charging Zone dwelling Moorhouses Reservoir, 15/01999/OUT 50 25% (12 homes) £2,700 £54 Zone U1 £19 Draft CIL rate North Shields Smiths Dock, North Shields 11/02390/OUT 800 3.75% (30 homes) £125,000 £156 Site is identified as U1. £19 Draft CIL rate. (Noted that agreed s106 for Smiths Dock reflects significant investment in remediation of a former shipyard.) East Wideopen Farmhouse, 16/00848/FUL 12 n/a £2,748 £229 Zone U1 (n.b prior to wider £47-£68 Draft CIL rate if in Wideopen development would have fallen place prior to development into either R1 or R2 zone) Tynemouth Road, Howdon, 13/01655/FUL 12 n/a £3,918 £327 Zone U0 £47-£68 Draft CIL rate if in Wallsend place prior to development Lynn Club, Cragside Avenue, 12/00699/FUL 13 n/a £6,966 £536 Zone U1 £19 Draft Cil rate North Shields John Street, Cullercoats 16/00193/FUL 10 n/a £5,895 £590 Zone U2 £24 Draft CIL rate Rosehill Social Club, 15/00329/FUL 10 n/a £5,895 £590 Zone U0 £0 Draft CIL rate Wallsend Dudley Peoples Centre 15/00949/FUL 14 n/a £8,498 £607 Zone U1 £19 Draft CIL rate 40 Bell Street, Fish Quay, 12/01745/FUL 14 n/a £9,142 £653 Zone U1 £19 Draft CIL rate North Shields Former High Point, Whitley 15/00731/FUL 14 n/a £9,506 £679 Zone R2 £24 Draft CIL rate Bay Charlotte Place (St 14/01490/FUL 41 n/a £27,839 £679 Zone U1 £19 Draft CIL rate Stephens, Longbenton) Former Breeze, Whitley Bay 13/00235/FUL 14 n/a £9,856 £704 Zone U2 £24 Draft CIL rate Fenwick Colliery, East 15/01307/FUL 18 Zero £12,978 £721 Zone R1 £45 Draft CIL rate Holywell Grange Interiors, Bird 16/01858/OUT 35 Zero £37,573 £1,074 Zone U1 £19 Draft CIL rate Street, North Shields West Chirton Industrial 14/01018/OUT 400 Between 2% and 15% £438,000 £1,095 Zone U0 £0 Draft CIL rate

62 1.16 North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Site / Description Planning reference Dwellings Affordable housing S106 agreed S016 per Relevant CIL Charging Zone dwelling Estate determined by phase Esplanade, Whitley Bay 13/01526/FUL 14 n/a £15,995 £1,143 Zone U2 £24 Draft CIL rate Kendal Building, Waterville 11/02074/OUT 40 Zero (daycare and £51,495 £1,287 Zone U1 £19 Draft CIL rate Road, North Shields sheltered apartments scheme) East Wideopen, Five Mile 13/00198/FUL 107 25% (27 homes) £150,624 £1,408 Zone U1 (n.b. prior to wider £47-£68 Draft CIL rate if in Park (northern extension) development would have fallen place prior to development into either R1 or R2 zone) Hadrian Education Centre, 12/02047/FUL 66 25% (17 homes) £100,109 £1,517 Zone U1 £19 Draft CIL rate Addington Drive, Wallsend St Bartholomews, Benton 15/00406/FUL 14 n/a £23,492 £1,678 Zone U2 £19 Draft CIL rate Norgas House, 13/00691/FUL 121 20% (24 homes) £212,815 £1,759 Zone U1 £19 Draft CIL rate Northumbrian Way, Killingworth Billys Pit, Benton, (Darsley 13/00965/FUL 75 25% (19 homes) £136,500 £1,820 Zone U2 (n.b. noted development £47-£68 Draft CIL rate if in Green) form equivalent to remaining area place prior to development rather than urban) Land at Great Lime Road, 13/01412/FUL 61 25% (16 homes) £140,326 £2,300 Zone U1 (n.b. prior to wider £47-£68 Draft CIL rate if in Forest Gate, development would have fallen place prior to development (The Coppice) into either R1 or R2 zone) Station Road, Backworth 16/01952/OUT 53 25% (13 homes) £135,329 £2,553 Zone U1 (n.b. prior to wider £47-£68 Draft CIL rate if in (South of Pavillion Pub) development would have fallen place prior to development into either R1 or R2 zone) Stanley Miller (The Limes), 11/01307/OUT 99 20 (19 homes) £253,000 £2,556 Zone U1 £19 Draft CIL rate Palmersville East Wideopen, Five Mile 09/02537/FUL 330 23% (74 dwellings) £909,258 £2,755 Zone U1 (n.b. prior to wider £47-£68 Draft CIL rate if in Park development would have fallen place prior to development into either R1 or R2 zone) Stephenson House, 16/00232/FUL 87 25% (21 homes) £284,812 £3,274 Zone U1 £19 Draft CIL rate Killingworth Darsley Park, Whitley Road, 15/01144/FUL 71 25% (18 homes) £306,750 £4,320 Zone U2 (n.b. noted development £47-£68 Draft CIL rate if in Benton (Whitfield Green) form equivalent to remaining area place prior to development rather than urban) North Tyneside General 11/00765/OUT 80 16% (13 homes) £348,780 £4,360 Zone U2 £24 Draft CIL rate Hospital, Rake Lane (Dove Park) Shiremoor West, 13/00781/OUT 590 25% (147 homes) £2,585,060 £4,381 Zone U1 (n.b. prior to wider £47-£68 Draft CIL rate if in

63 1.16 North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Site / Description Planning reference Dwellings Affordable housing S106 agreed S016 per Relevant CIL Charging Zone dwelling (Backworth Park) development would have fallen place prior to development into either R1 or R2 zone) Land East of the Covers, 13/00987/FUL 58 25% (15 homes) £276,478 £4,767 Zone U1 £19 Draft CIL rate (The Meadows) Former Parkside School, 14/00897/FUL 69 25% (17 homes) £347,928 £5,042 Zone U1 £19 Draft CIL rate (Meadowfield), Wallsend Ballast Hill Road, North 16/01692/FUL 34 £100k commuted sum £173,000 £5,088 Zone U1 £19 Draft CIL rate Shields Station Road East, Wallsend 12/02025/FUL 650 25% (162 homes) £2,349,650 £3,615 Zone R1 £47 Draft CIL rate (East Benton Rise) Station Road West, 16/01885/FUL 593 25% (148 homes) £3,817,890 £6,438 Zone R1 £47 Draft CIL rate Wallsend West of Backworth, 14/01687/OUT 290 25% (73 homes) £1,969,565 £6,792 Zone R1 £47 Draft CIL rate Killingworth Avenue (Backworth Park) Former REME Depot, 14/00730/FUL 125 25% (31 homes) £931,094 £7,449 Zone R2 £68 Draft CIL rate Killingworth, Stephenson Park Scaffold Hill (Holystone 11/01600/FUL 450 25% (113 homes) £4,077,600 £9,061 Zone U1 (n.b. prior to £47 Draft CIL rate Park) commencement of development would have fallen into either R1 or R2 zone) North of North Ridge, 11/00226/OUT 200 £3m commuted sum £3,870,000 £19,350 Zone U2 (n.b. prior to £47-£68 Draft CIL rate if in Whitley Bay (West Park) commencement of development place prior to development 12/00675/FUL would have fallen into either R1 or (Noted that agreed S106 R2 zone) includes affordable housing commuted sum) Whitehouse Farm 11/02337/FUL 384 £6.44m commuted £8,654,565 £22,538 Zone U1 (n.b. prior to £47-£68 Draft CIL rate if in (Moorfields) 16/01316/FUL sum commencement of development place prior to development would have fallen into either R1 or (Noted that agreed S106 R2 zone) includes affordable housing commuted sum)

64 1.16 North Tyneside Local Plan Area Wide Viability Assessment CIL Update, 2018

Appendix 2: Sales Value and Floor Area – Land Registry and EPC based data Planning Development Developer Analysis based on available Energy Performance and Land Registry Data Analysis based on Land Registry Data alone CIL Reference Sales Total Floor Total Sales Sales Vale / Average Floor Average Sale Sales Total Sales Average Sale Sales Zone Area Value sqm Area Value Value Value timeframe 04/01170/FUL St Aidan's, Wilington Bellway 16 1,841 £2,898,228 £1,574 115.06 £181,139 45 £6,252,008 £138,933.51 to 2014 U0 Quay, Wallsend 04/03816/REM Earsdon View, Bellway 220 19,136 £41,492,584 £2,168 86.98 £188,603 369 £74,408,259 £201,648 early 2000s U1 Shiremoor to date 05/02234/FUL St Aidan's, Wilington Bellway 19 1,179 £1,801,585 £1,528 62.05 £94,820 - to 2014 U0 Quay, Wallsend 09/02537/FUL East Wideopen (Five Bellway 31 2,372 £4,840,375 £2,041 76.52 £156,141 292 £71,182,270 £243,775 2013 to date R1 Mile Park) 09/03159/FUL Montague Apartments Small developer 1 114 £275,000 £2,412 114.00 £275,000 5 £1,325,000 £265,000 £2,013 U2 10/02040/FUL Land adjacent to the Bellway 22 2,394 £4,714,463 £1,969 108.82 £214,294 22 £4,714,463 £214,294 to 2013 U1 Covers (The Acres) 10/02567/FUL Former St Joseph’s Bellway 10 1,757 £4,087,180 £2,326 175.70 £408,718 11 £4,557,180 £414,289 to 2013 U2 Training Centre, Killingworth Village 11/00226/OUT West Park, Wellfield, Taylor Wimpey 85 12,108 £31,929,170 £2,637 142.45 £375,637 118 £46,220,165 £391,696 2014 to date U2 Monkseaton 11/00748/FUL St Leonards, Linskill, Gentoo Homes 10 1,479 £3,490,500 £2,360 147.90 £349,050 12 £4,220,500 £351,708 to 2013 U2 North Shields 11/00765/OUT Dove Park, North Story Homes 10 1,149 £2,877,500 £2,504 114.90 £287,750 46 £12,148,000 £264,087 2016 to date U2 Shields 11/01307/OUT Stanley Miller (The Taylor Wimpey 73 7,010 £13,558,571 £1,934 96.03 £185,734 96 £18,119,993 £188,750 to 2016 U1 Limes) 11/01346/FUL Howdon Green Bellway 7 585 £1,099,275 £1,879 83.57 £157,039 7 £1,099,275 £157,039.29 2013/14 U0 11/02037/FUL Former Gleeson Homes 9 628 £964,505 £1,536 69.78 £107,167 11 £1,178,135 £107,103 to 2013 U0 Northumberland Arms and PH, Rosehill, Wallsend regeneration 12/01083/FUL Reflection, Annitsford Gentoo Homes 13 1,542 £2,884,795 £1,871 118.62 £221,907 13 £2,884,795 £221,907 2014/15 U1 12/01265/FUL Stanton Grove, North Derestreet 13 835 £2,369,350 £2,838 64.23 £182,258 13 £2,369,350 £182,258 2014/15 U2 Shields Housing 12/02047/FUL Hadrian Education Avant (Formerly 47 5,052 £11,528,390 £2,282 107.49 £245,285 49 £12,003,380 £244,966.94 2014 to U1 Centre, Wallsend Bett Homes) 2016 13/00622/FUL St Edmunds Close Avant (Formerly 10 1,156 £2,353,450 £2,036 115.60 £235,345 11 £2,603,445 £236,677 to 2014 U1 Bett Homes) 13/00691/FUL Norgas House Barratt 103 8,291 £17,163,647 £2,070 80.50 £166,637 117 £19,276,492 £164,756 2013 to U1 2016

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Planning Development Developer Analysis based on available Energy Performance and Land Registry Data Analysis based on Land Registry Data alone CIL Reference Sales Total Floor Total Sales Sales Vale / Average Floor Average Sale Sales Total Sales Average Sale Sales Zone Area Value sqm Area Value Value Value timeframe 13/00781/OUT Backworth Park Miller Homes, 11 1,270 £2,862,560 £2,254 115.45 £260,233 100 £29,168,960 £291,690 2016 to date R1 (Heritage Green, Story Homes Brierdene) 13/00965/FUL Darsley Green, Benton Taylor Wimpey 39 4,419 £10,464,521 £2,368 113.31 £268,321 39 £10,464,521 £268,321 2014/15 U2 13/00987/FUL Adjacent to Covers II Bellway 54 4,945 £9,683,052 £1,958 91.57 £179,316 49 £8,830,972 £180,224 2014 to U1 (The Meadows) 2016 13/01412/FUL The Coppice, Land at Avant (Formerly 44 4,933 £11,018,780 £2,234 112.11 £250,427 43 £10,798,785 £251,135 2014 to U1 Great Lime Road, Forest Bett Homes) 2015 Gate 14/00897/FUL Former Parkside School Bellway 17 1707 £3,688,720 £2,161 100.41 2,160.94 52 £10,950,555 £210,588 2016 to date U1 (Parkside Meadows) 14/01490/FUL Former St Stephens Keepmoat 31 2,488 £5,022,845 £2,019 80.26 £162,027 31 £5,022,845 £162,027 2015/16 U1 (Charlotte Place) Homes 15/00945/FUL Scaffold Hill, Holystone Taylor Wimpey, 4 406 £934,980 £2,303 101.50 £233,745 92 £24,747,556 £268,995 2016 to date R1 (Holystone Park) Bellway 11/02337/FUL Whitehouse Farm Bellway 51 £17,276,390 £338,752.75 2017 to date R1 Energy Performance not recorded for these sites 12/02025/FUL East Benton Rise 76 £14,858,790 £195,510.39 2017 to date R1 13/00873/FUL Monks Haven 2 £472,450 £236,225.00 2015 U2

14/00046/FUL Hatfield House, Unknown 32 £2,129,218 £66,538.06 2015/16 U1 Apartments 14/00730/FUL Stephenson Park Bellway 54 £14,330,340 £265,376.67 2016 to date R2 15/00406/FUL St Bartholomew’s Gentoo Homes 5 £1,943,750 £388,750.00 2017 to date U2

15/00945/FUL Holystone Park 92 £24,747,556 £268,995.17 2016 to date R1

15/01144/FUL Whitfield Green Taylor Wimpey 21 £7,203,894 £343,042.57 2017 to date U2 16/00232/FUL Southgate Park Bellway 18 £2,665,002 £148,055.67 2017 to date U1

13/01342/FUL Station Apartments Small builder 6 £1,042,500 £173,750.00 2016/17 U2 04/01271/FUL East Farm Mews, Charles Church 1 £284,950 £284,950.00 2016 U1 Backworth 13/00335/FUL Deauchars, Backworth Small builder 6 £1,014,950 £169,158.33 2015/16 U1 (conversion) 08/03446/FUL Panama View, Blue 2 £269,000 £134,500.00 2016/17 U2 Apartments Developments Ltd 13/02105/FUL Walton Cottage, Small builder 1 £370,000 £370,000.00 2015 U1

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Planning Development Developer Analysis based on available Energy Performance and Land Registry Data Analysis based on Land Registry Data alone CIL Reference Sales Total Floor Total Sales Sales Vale / Average Floor Average Sale Sales Total Sales Average Sale Sales Zone Area Value sqm Area Value Value Value timeframe Preston 09/02229/FUL Glendale Ave., Whitley Small builder 1 £325,000 £325,000.00 2015 U2 Bay Energy Performance not recorded for these sites 14/00083/FUL Benton Farm Mews, HRT 5 1208000 £241,600.00 2015/16 U2 Benton Developments 05/02631/FUL Churchill Court, Whitley Small builder 3 £690,000 £230,000.00 2014/15 U2 Bay 05/03255/FUL The Irvin Building Gentoo Homes 1 £135,000 £135,000.00 2015 U1 09/01681/FUL Vernon Drive, Small builder 1 £400,000 £400,000.00 2013 U2 Monkseaton 10/03198/FUL Former Glebe School, Charles Church 9 £3,129,700 £347,744.44 2013 U2 Whitley Bay (Lodge Court) 11/01834/FUL Queens Vale, Wallsend Avant (former 9 £1,930,465 £214,496.11 2013 U1 Coast Road Bett Homes) 10/01033/FUL Meadway House, Forest Bellway Homes 1 £200,000 £200,000.00 2013 U1 Hall 06/02852/FUL White Swan Close, Dunelm 5 £930,985 £186,197.00 2013 U1 Killingworth 12/01451/FUL Former Magpie Pub, Blue Box 2 £344,000 £172,000.00 2013 U1 North Shields (Blue Box Development Dev.) 10/01274/FUL Warrington Grove, Ben Bailey 4 £549,225 £137,306.25 2013 U1 North Shields Homes

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Appendix 3: House Types by Development Site Developer Development Site House type plans No. on Site / Phase Beds Square feet Square metres Bellway Earsdon View Whitebeam - 4 1,660 154 Bellway Earsdon View Alder - 4 1,525 142 Bellway Earsdon View Acacia - 4 1,418 132 Bellway Earsdon View Rowan - 4 1,228 114 Bellway Earsdon View Juniper - 4 969 90 Bellway Earsdon View Hazel - 3 916 85 Bellway Holystone Park Redwood 6 4 2,085 194 Bellway Holystone Park Plane 11 4 1,718 160 Bellway Holystone Park Pine 14 4 1,666 155 Bellway Holystone Park Bay 13 4 1,661 154 Bellway Holystone Park Alder 6 4 1,525 142 Bellway Holystone Park Lime 7 4 1,422 132 Bellway Holystone Park Acacia 17 4 1,418 132 Bellway Holystone Park Oak 19 4 1,327 123 Bellway Holystone Park Rowan 17 4 1,228 114 Bellway Holystone Park Maple 17 4 1,193 111 Bellway Holystone Park Chestnut 17 3 965 90 Bellway Holystone Park Hawthorn 2 3 946 88 Bellway Holystone Park Willow 2 3 946 88 Bellway Holystone Park Hazel 8 3 916 85 Bellway Holystone Park Cherry 8 3 795 74 Bellway Holystone Park Ash 3 2 637 59 Taylor Wimpey Holystone Park Flatford 11 3 866 80 Taylor Wimpey Holystone Park Midford 12 4 1,170 109 Taylor Wimpey Holystone Park Shelford 22 4 1,378 128 Taylor Wimpey Holystone Park Aldenham 26 3 967 90 Taylor Wimpey Holystone Park Downham 31 4 1,244 116 Taylor Wimpey Holystone Park Eynsham 30 4 1,334 124 Taylor Wimpey Holystone Park Haddenham 22 4 1,460 136 Taylor Wimpey Holystone Park Lavenham 17 5 1,646 153 Taylor Wimpey Holystone Park Milldale 7 3 869 81 Bellway The Meadows Salisbury 6 3 870 80.8 Bellway The Meadows Tornado 1 3 915 85 Bellway The Meadows Sandhurst 20 3 893 82.94 Bellway The Meadows Brampton 6 3 958 89.03 Bellway The Meadows Somerton 2 4 977 90.76 Bellway The Meadows Stourton 7 4 1,181 109.68 Bellway The Meadows Brentwood 4 4 1,349 125.34

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Developer Development Site House type plans No. on Site / Phase Beds Square feet Square metres Bellway The Meadows Belsay 6 4 1,362 126.5 Bett Coppice Place salisbury 3 3 870 80.8 Bett Coppice Place brampton 6 3 1,010 93.8 Bett Coppice Place somerton 1 3 1,230 114.3 Bett Coppice Place sandhurst 10 3 1,230 114.3 Bett Coppice Place weston 2 6 4 1,273 118.28 Bett Coppice Place brentwood 2 7 4 1,349 125.34 Bett Coppice Place belsay 5 4 1,359 126.3 Bett Coppice Place stourton 8 4 1,230 114.3 Bett Hadrian Mews M1.6 5 3 848 78.7792 Bett Hadrian Mews m1.7b 4 3 900 83.61 Bett Hadrian Mews m1.9b 6 3 975 90.5775 Bett Hadrian Mews m1.10a 3 3 1,020 94.758 Bett Hadrian Mews m1.11 12 4 1,173 108.9717 Bett Hadrian Mews M2.1 4 4 1,291 119.9339 Bett Hadrian Mews m2.2 8 4 1,360 126.344 Bett Hadrian Mews m2.5a 4 4 1,400 130.06 Bett Hadrian Mews t4 3 4 1,238 115.0102 Taylor Wimpey West Park Wilton 23 5 1,739 162 Taylor Wimpey West Park Portrush 10 5 2,551 237 Taylor Wimpey West Park Troon 9 5 2,380 221 Taylor Wimpey West Park Cavendish 13 4 2,220 206 Taylor Wimpey West Park Ashbury 16 5 2,034 189 Taylor Wimpey West Park Lavenham 44 5 1,625 151 Taylor Wimpey West Park Hadenham 14 4 1,441 134 Taylor Wimpey West Park Downham 41 4 1,226 114 Taylor Wimpey West Park Radford 18 4 1,351 126 Taylor Wimpey West Park Sherbourne 9 5 1,792 166 Taylor Wimpey West Park Langdale 3 4 1,515 141 Miller Heritage Green Darwin 3B det 7 3 921 86 Miller Heritage Green Darwin DA 3 3 939 87 Miller Heritage Green Kipling 6 3 1,027 95 Miller Heritage Green Orwell 10 3 960 89 Miller Heritage Green Esk 8 4 1,098 102 Miller Heritage Green Rolland 14 4 1,086 101 Miller Heritage Green Buchan 8 4 1,264 117 Miller Heritage Green Auden 18 4 1,278 119 Miller Heritage Green Crompton 17 4 1,341 125 Miller Heritage Green Mitford 10 4 1,381 128

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Developer Development Site House type plans No. on Site / Phase Beds Square feet Square metres Miller Heritage Green Ryton 16 4 1,400 130 Miller Heritage Green Stevenson B 6 4 1,401 130 Miller Heritage Green Stevenson DA 5 4 1,419 132 Miller Heritage Green Buttermere 7 5 1,502 140 Miller Heritage Green Jura 8 5 1,679 156 Miller Heritage Green Roserbury 7 5 1,984 184 Miller Heritage Green Tressell 1 4 1,349 125 Persimmon East Benton Rise Ph1&2 8 2 613 57 Persimmon East Benton Rise Ph1&2 Chedworth 27 4 1,257 117 Persimmon East Benton Rise Ph1&2 Cherryburn 10 4 1,244 116 Persimmon East Benton Rise Ph1&2 Cheviot A 4 2 609 57 Persimmon East Benton Rise Ph1&2 Cheviot B 4 2 664 62 Persimmon East Benton Rise Ph1&2 Dunston 2 616 57 Persimmon East Benton Rise Ph1&2 Horton 20 3 969 90 Persimmon East Benton Rise Ph1&2 Lumley 35 4 1,223 114 Persimmon East Benton Rise Ph1&2 Caldwell 16 2 650 60 Persimmon East Benton Rise Ph1&2 Roseberry 18 4 1,096 102 Persimmon East Benton Rise Ph1&2 Rufford 76 3 870 81 Persimmon East Benton Rise Ph1&2 Swale 87 3 929 86 Persimmon East Benton Rise Ph1&2 Winster 19 4 1,257 117 Persimmon East Benton Rise Ph1&2 Woodchester 12 5 1,590 148 Persimmon East Benton Rise Ph1&2 Prestwick 15 3 1,068 99 Robertson Backworth Park Jasmine Story Homes Backworth Park Wellington 12 4 1,238 115 Story Homes Backworth Park Greenwhich 11 4 1,261 117 Story Homes Backworth Park Durham 12 4 1,334 124 Story Homes Backworth Park Boston 15 4 1,351 126 Story Homes Backworth Park Warwick 11 4 1,402 130 Story Homes Backworth Park Arundel 8 4 1,440 134 Story Homes Backworth Park Harrogate 12 4 1,583 147 Story Homes Backworth Park Taunton 13 4 1,592 148 Story Homes Backworth Park Balmoral 12 4 1,724 160 Story Homes Backworth Park Winchester 8 4 1,735 161 Story Homes Backworth Park Salisbury 10 4 1,795 167 Story Homes Backworth Park Mayfair 11 5 1,905 177 Taylor Wimpey Whitfield Green Aldenham 5 3 967 90 Taylor Wimpey Whitfield Green Downham 9 4 1,290 120 Taylor Wimpey Whitfield Green Lindale 4 4 1,290 120 Taylor Wimpey Whitfield Green Eynsham 11 4 1,334 124

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Developer Development Site House type plans No. on Site / Phase Beds Square feet Square metres Taylor Wimpey Whitfield Green Shelford 3 4 1,369 127 Taylor Wimpey Whitfield Green Haddenham 6 4 1,460 136 Taylor Wimpey Whitfield Green Lavenham 9 5 1,646 153 Taylor Wimpey Whitfield Green Wilton 6 5 1,759 163 Bellway Stephenson Park Aintree 3 4 1,700 158 Bellway Stephenson Park Belsay 14 4 1,361 126 Bellway Stephenson Park Brampton 13 Bellway Stephenson Park Brentwood 13 4 1,349 125 Bellway Stephenson Park Coleridge 5 4 1,609 149 Bellway Stephenson Park Goodwood 5 Bellway Stephenson Park Kempton 3 4 1,658 154 Bellway Stephenson Park Portland 2 4 1,998 186 Bellway Stephenson Park Sandhurst 9 Bellway Stephenson Park Southwell 6 4 1,887 175 Bellway Stephenson Park Stourton 9 4 1,200 111 Bellway Stephenson Park Weston 5 4 1,273 118 Keepmoat Charlotte Place (St Stephens) 665 8 2 665 62 Keepmoat Charlotte Place (St Stephens) 763 5 2 763 71 Keepmoat Charlotte Place (St Stephens) 836 3 4 836 78 Keepmoat Charlotte Place (St Stephens) 858 3 3 858 80 Keepmoat Charlotte Place (St Stephens) 869 6 2 869 81 Keepmoat Charlotte Place (St Stephens) 951 4 3 951 88 Keepmoat Charlotte Place (St Stephens) 1011 11 3 1,011 94 Bluebox Development St Johns, Cullercoates 1BF 2 1 527 49 Bluebox Development St Johns, Cullercoates 2BF 6 2 581 54 Bluebox Development St Johns, Cullercoates 3BF 2 3 1,335 124 Marine Buildings Ltd St Marks, Wallsend 2BH 12 2 678 63 Lakeland Timber Framed homes Front St, Annitsford HT A 6 4 1,675 156 Lakeland Timber Framed homes Front St, Annitsford HT B 2 4 1,571 146 Lakeland Timber Framed homes Front St, Annitsford HT C 3 4 1,560 145 Lakeland Timber Framed homes Front St, Annitsford HT D 1 4 1,571 146 Lakeland Timber Framed homes Front St, Annitsford HT E 1 4 1,675 156 PC Developments Dudley People's Centre Type 2 10 3 1,141 106 PC Developments Dudley People's Centre Type 1 4 3 1,485 138 Taylored Property Group Ltd Former Dame Allan's Junior School Flat 1 2 1 339 31.5 Taylored Property Group Ltd Former Dame Allan's Junior School Flat 2 7 2 598 55.6 Taylored Property Group Ltd Former Dame Allan's Junior School Flat 3 3 2 651 60.5 Taylored Property Group Ltd Former Dame Allan's Junior School Flat 4 9 2 705 65.5 Taylored Property Group Ltd Former Dame Allan's Junior School Flat 5 2 2 780 72.5

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Developer Development Site House type plans No. on Site / Phase Beds Square feet Square metres Kier North Tyneside The Avenue, Whitley Bay Type 1&2 9 3 1,399 130 Kier North Tyneside The Avenue, Whitley Bay Type 3 1 4 1,507 140 Kier North Tyneside The Avenue, Whitley Bay Type 4 (F) 1 1 728 67.59 Kier North Tyneside The Avenue, Whitley Bay Type 4 (H) 1 3 1,455 135.18 Derestreet Housing Stanton Grove, North Shields Type A, B 12 2 751 69.73 Derestreet Housing Stanton Grove, North Shields Type C, D 2 2 781 72.6 Bellway The Covers, Wallsend Acacia 3 4 1,360 126 Bellway The Covers, Wallsend Birch 4 3 795 74 Bellway The Covers, Wallsend Elder 2 3 940 87 Bellway The Covers, Wallsend Hawthorn 2 3 946 88 Bellway The Covers, Wallsend Hazel 3 3 916 85 Bellway The Covers, Wallsend Laurel 10 4 1,079 100 Bellway The Covers, Wallsend Lime 2 4 1,422 132 Bellway The Covers, Wallsend Maple 2 4 1,193 111 Bellway The Covers, Wallsend Rowan 7 4 1128 105 Bellway The Covers, Wallsend Willow 7 3 946 88 Persimmon Amberley, Killingworth Swale 12 4 929 86 Persimmon Amberley, Killingworth Rufford 6 3 870 81 Persimmon Amberley, Killingworth Hatfield 6 4 969 90 Persimmon Amberley, Killingworth Roseberry 3 4 1096 102 Persimmon Amberley, Killingworth Crathorne 2 4 1154 107 Persimmon Amberley, Killingworth Chedworth 4 4 1222 114 Persimmon Amberley, Killingworth Hanbury 2 2 761 71

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