First sites earmarked for housebuilding under Public Land Initiative

The government this week unveiled the first three publicly-owned sites to be made available for housebuilding under its Public Land Initiative.

The three chosen sites – which, subject to planning permission, will provide nearly 500 new homes – are in Doncaster, Milton Keynes and Newcastle. The Doncaster and Milton Keynes sites are currently owned by the Homes and Communities Agency, while the Newcastle location is owned jointly by regional development agency One North East and Newcastle City Council.

Under the deal, the government provides the land but takes out the upfront costs and risks involved in site purchase and preparation. Contractors only play for the land once the completed homes are sold, although they will obtain a reduced profit as a result.

The government has already put together a panel of approved partners with a view to reducing contract bidding and procurement costs. Contractors working on Public Land Initiative deals are also contractually required to provide apprenticeship and local job opportunities.

Housing Minister John Healey called on other public bodies – including local authorities – to follow suit and identify land they own that could be made available for housebuilding.

The government estimates that 100,000 homes could be built on council land. Other potential locations include NHS, transport, military and school site.

The minister said: “We have to innovate and test new ways of funding and building the homes we need. So I’m offering a New Deal for public-private housebuilding, with new partnership terms in which companies take a smaller profit because government takes more of the risk by lowering costs and increasing competition in housebuilding.”

Sir Bob Kerslake, chief executive of the Homes and Communities Agency, said: “The Public Land Initiative is a significant new model for creating strong public-private partnerships that share the risks and rewards of delivering new homes. These first three sites will be an important test bed for the initiative and its aim to spearhead the wide-scale delivery of homes that meet Level 4 of the Code for Sustainable Homes.”