Decision details

Background

The council undertook a survey of the council housing stock in 2004 to determine how much investment was required for properties to meet the decent homes standard and it was found that the structural condition of the Airey ( Pre- fabricated) properties meant that they would not meet the decent homes standard, without considerable investment. Therefore, on 28^th October 2004 full council approved redevelopment as the most cost-effective solution for those Airey sites with redevelopment potential. The Airey properties at Paddock Row Elsworth were agreed as having redevelopment potential. As, the council was not developing council homes at that time a consultative tender process was undertaken and, Wherry Housing Association, which is now known as Clarion, were selected as the council’s preferred partner to undertake the redevelopment program in South Cambs. As part of this process the land owned by South Cambridgeshire District Council was transferred to Wherry Housing Association (now Clarion) on a 125-year lease. Following redevelopment Wherry Housing Association should then have granted subleases on a shared ownership basis for a term of 125 years (less 10 days)

Purpose

South Cambs District Council transferred the land at Paddock Row Elsworth to Wherry Housing Association/ Circle Anglia (now Clarion) on a 125-year lease from 22^nd December 2006 expiring on 21^st December 2131. Unfortunately, Clarion found that the sub leases that were issued by them, for the shared ownership properties, were not compatible with the Head lease. Therefore, Clarion have formally submitted a request for a new lease to be granted to them (overriding lease), which will sit above the Head lease and be for a term expiring on 21^st April 2132. This will ensure that Clarion’s interest in the properties at Paddock Row Elsworth, will exceed that of the shared ownership leases.

The purposes of this decision are to allow the Council to approve Clarion’s request to grant an overriding lease for land that was transferred, as part of the Airey properties redevelopment programme at Paddock Row Elsworth.

To approve Clarion’s request to grant an overriding lease relating to the properties at Paddock Row Elsworth, for term expiring on 21^st April 2132.

In granting an overriding lease to increase the term by 4 months will ensure that Clarion’s interest in the properties at Paddock Row Elsworth exceed that of the shared ownership leases. This will ensure that the shared owners are protected by the terms of their lease and avoid difficulties when trying to sell their property on.

Option 1 – To refuse Clarion’s request to grant an overriding lease means that those subleases which have been granted for a term longer than the Head Lease are treated as an assignment of Clarion’s interest by operation of law. This means that there is no Landlord and Tenant relationship between Clarion and the Sub Tenants, and the council is technically the direct Landlord of the Sub Tenants.