Telford & Wrekin Council in £45 million cash bid to build new homes
Telford & Wrekin Council wants to borrow £45.7m and set up a company to build and rent out around 425 homes.
The authority would lend the cash to the landlord company to build 425 homes on council-owned brownfield land valued at £6.775 m.
And the council would invest £6.1m to build shops, bars and restaurants at Southwater where more than 100 apartments would be sited and at Madeley Court where there would be 50 homes.
The pioneering scheme would see Telford & Wrekin become one of the first councils in the country to set up its own housing company.
Council chiefs hailed the plan as "innovative" action to offset the effects of Government grant cuts by generating an income to protect essential frontline services.
But it comes after councillors last week backed borrowing up to £120m from Government to help secure a Ministry of Defence logistics centre in Donnington.
The authority's finance chief Councillor Bill McClements insisted both were examples of "good borrowing" which would result in a return to be ploughed back into vital services.
The new homes in Southwater, Hollinswood, Randlay, Madeley, Newport, Malinslee and Woodside would be rented to private tenants at market rates, with 20 per cent of the homes being classed as affordable rent.
At Madeley Court, 50 homes, two supermarkets and a restaurant are planned and another 101 homes would be built on the former Woodland Primary School in Woodside.
The council's cabinet will be asked to recommend to full council the release of the council-owned land and the set up of the company to deliver the scheme.
Telford & Wrekin would borrow £45.7m from the Public Works Loan Board which it would lend to the company to construct the housing, which it will repay at a commercial rate of interest.
The company would act as a residential landlord overseeing the homes that are built and managing them once complete.
The commercial properties at Southwater and Madeley would be incorporated into the council's already established property investment portfolio, adding to the 600 commercial properties already held there.
The works would create a number of jobs during the construction and operational phase.
Councillor Bill McClements, Telford & Wrekin Council's cabinet member for Finance and Enterprise, said: "This scheme will deliver quality private rental and affordable rental homes in response to the borough's projected housing needs.
"It is a major programme that will deliver jobs in retail and construction and generate income to boost the borough's economy.
"This is a very forward thinking approach to income generation and economic regeneration and demonstrates that we are committed in a big way to innovative commercial activities."
Councillor Shaun Davies, cabinet member for Employment and Skills, said: "This is about job creation and growth as much as it is about regeneration and responding to housing needs.
"I am delighted that we are in a position to combine both and create employment through the development of previously redundant council sites.
"We are committed to encouraging as many people into new and better employment as possible and this is a clear demonstration of that."
Where the homes could be built:
- Southwater: 115 apartments with car parking and two ground floor shops
- Hollinswood: 12 market rental and 32 affordable rental homes
- Randlay Lorry Park: 31 market rental homes
- Former Woodlands Primary School, Woodside: 101 market rental homes
- Madeley Court: 50 market rental homes, two supermarkets and a restaurant
- Springfields, Newport: 29 affordable rent homes
- Matlock Avenue, Malinslee: 30 market rental homes
- Wildwood, Woodside: 25 affordable rental homes to be built
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