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LONDON, April 13 (Thomson Reuters Foundation) - Residents of one of inner London's poorest boroughs have launched a legal challenge against plans to demolish 1,300 flats for low-income families to make way for a 2 billion pound ($2.5 billion) housing project managed by a private developer.
Residents from Haringey borough said the redevelopment represents the largest single transfer of local government land to the private sector in Britain, where gentrification has changed neighbourhoods at a lightning pace.
The project between Haringey Council and Australian property giant LendLease, will result in apartment blocks and commercial properties being bulldozed to build 5,000 new homes and a new town centre over the next 20 years.
The deal, to be formally signed in July, will create a new private company owned 50-50 by Haringey Council and Lendlease.
Haringey Council Leader Claire Kober said the project would create thousands of new homes and jobs with the council committing to do its "utmost" to allow existing tenants to return to a new home on the site on similar rents and terms.
But Gordon Peters, one complainant in the legal case, said the council was "gambling" on a project that lacks community backing and may not be economically viable in the uncertainty sparked by Britain's decision to leave the European Union.
"Our argument is they've jumped the gun," he said, referring to the council's announcement of the deal last month.
"They (the council) are saying (the project) doesn't have to be voted on," Peters told the Thomson Reuters Foundation. "There's a very strong case for challenging that."
Alan Strickland, Haringey Council's head of housing, said residents would be consulted.
"No land will transfer without prior consultation with local residents and businesses, as well as going through the usual planning processes," Strickland told the Thomson Reuters Foundation.
LendLease did not respond to requests for comment.
London's state-funded social housing blocks, leased at below-market rates, have become flashpoints in the capital's housing crisis.
Mainly built in the 1960s and 1970s, local authorities have razed many of the concrete high-rises to erect modern developments.
Residents in Haringey said they feared the area could follow the example set by LendLease's redevelopment of a housing block in south London's Elephant and Castle neighbourhood where more than 90 percent of social housing was lost.
Michael Edwards, professor of planning at University College London, said rising inflation after the Brexit vote could result in a crisis comparable to the early 1990s, when massive developments went bankrupt.
He said the project should be abandoned as the joint venture with LendLease did not allow for Haringey council to veto any of its plans and is therefore not able to make any strong promises about outcomes.
Earlier this week official figures showed inflation almost gnawed away the growth in British workers' pay during the three months to February, the clearest evidence yet that households are feeling the strain of rising prices as Brexit negotiations begin. ($1 = 0.7988 pounds) (Reporting by Matthew Ponsford, Editing by Katie Nguyen; Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women's rights, trafficking, property rights, climate change and resilience. Visit news.trust.org)