Oxford North

St John's College has proposed to subtract 72 affordable homes from their new business park on the northern fringe of Oxford. We examine their claims.

Update
19th November 2019

The reports have been uploaded for the deferred planning committee on 27th November and the central issues have still not been addressed. Read our update statement by clicking below.

STATUS: SUBMITTED PLANNING

Developer
Thomas White Oxford (St John's College)
Landowner
Thomas White Oxford (St John's College)
Area
26 hectares (64.1 acres)
The Oxford North development between Wolvercote/Cutteslow and Peartree Park and Ride is being developed by Thomas White Oxford, a private company owned by the registered Charity St John's College, on land that St John's College owns.
​
The Northern Gateway Area Action Plan (AAP) was approved in 2015, eight years after Oxford City Council first allocated the site in the 2007 draft Core Strategy (adopted 2011). An outline application for a 26 hectare part of the AAP area, referred to as Oxford North, was submitted in late-July 2018 and came to Planning Committee in September 2019 (link) supported by the planning officer at Oxford City Council.

​The plans gained press-attention in 2018 (link) for not including any affordable housing due to infrastructure costs, however, the developer pledged that they intended to deliver 25% affordable housing, half of the policy-requirement of 50%. This is Oxford's richest college with over a £0.5bn endowment. 

​If delivering to policy didn't work in 2018 it's unlikely to work in 2020 without some big changes to the approach and finances now. In June 2019 Thomas White Oxford wrote a letter to Oxford City Council in which they asserted that 30% affordable housing would work for them in terms of profitability, but only if the proportion of social housing was reduced. The 30% option meant 106 social homes would be lost and St John's College would receive £68.4m in profit.

In September 2019 Thomas White Oxford wrote a letter to Oxford City Council saying that 35% affordable housing would work for them - meaning a loss of 58 social homes with a profit to St John's College of £85.7m. Delivering more social homes should not make the profit go up and the key issue here is the methodology used in the Financial Value Assessment.

At the West Area Planning Committee on Tuesday 24th September 2019 (link) Councillors decided to defer the decision on Oxford North until 27th November (link). ​It is now more important than ever that Councillors and Officers are supported to ensure a policy-compliant level of affordable housing (240 homes - 50%). ​Write to your Councillor to ask for the fundamental principles of this scheme to be re-considered.
We've had a valuation consultant, Dr Stephen Walker (RICS), look over the documents that were added to the West Area Planning Committee meeting page (link) on 23rd September. Dr Walker regularly works on behalf of Councils in these kind of matters. The letter (download below) outlines an initial view on the principles of development.

Letter from Dr Stephen Walker (viability expert)

Oxford North Letter (23rd Sep 2019)
File Size: 120 kb
File Type: pdf
Download File

Issues

The modelling approach
  • The land value should be an output of modelling (what is left over after all costs) under current guidance (PPG19). A 'fixed' land value of £12.4m has been used in appraising whether affordable housing is viable.
  • The Proposed 'fixed' land value of £12.4m is not related to 'Existing Use Value' as recommended in current guidance (PPG19)
  • Developer's profit should be a fixed assumption - an input - based on comparable, local, and contemporary evidence. The developer's profit has been derived as an output of the modelling.
  • The effects of time on costs and values is an important factor which changes the land value. The modelling has used today's costs and values without any clear evidence inflating or discounting - this is especially important when it comes to rental values in which small changes make a big impact on the residual land value.
  • Lacking a holistic view taken to see St John's College 'competitive return' in the unusual situation of being landowner, developer and partial long-term landlord.
The evidence-base
  • There is no clear, comparable, local evidence of cost and value assumptions to arrive at Benchmark Land Value of £12.4m. The evidence for the Benchmark Land Value is from a 2015 scheme in Exeter which is not a suitable comparator, under current guidance (PPG19), for why the landowner’s premium should be a multiple of 20-times the agricultural value.
  • The appraisal uses a cash flow methodology, but the only information supplied is the rate of interest. No information on:
    • ​Development period
    • Build period
    • Period covering voids
    • Period before start of construction [after land has been bought, before construction starts]
    • Build out pace [per month]
    • Sales' rate [per month]

You now have three options to dig deeper into the story...

Who owns it? How much has been paid for it so far? What are the different ways it has been valued?
How much will St John's make from this land investment? How has this been calculated?
The final chapter in this story. How do St John's intend to deliver their obligations using periodic reviews throughout the development?
Every effort has been made to ensure the accuracy of information on this website, however we are group of local volunteers and this is a complex field. If you believe an element of this website is inaccurate please contact us and we will do our best to amend it