Council seeks approval on £12.5m housing scheme

Worthing Borough Council is set to approve a housing scheme joint venture with housing association Vivid, which would see the council invest £12.5m.Under the proposal, set to be discussed at a council meeting next week, Vivid would acquire land at Teville Gate from Mosaic Global Investments, which wishes to sell the land due the impact of Covid-19 on the economy.The council would be required to invest £12.5m towards 100 market value homes, with Vivid set to invest the remaining 50% and develop and manage a further 130 affordable homes.Worthing said the funding will come from the Public Works Loan Board borrowing at a rate of 1.8% for a two-year loan.Worthing said interest costs will total between £450,000 – £675,000 over the course of the development, which due to pandemic constraints it is unable to finance through its revenue budgets. As a result, the joint venture must ensure that the interest costs are paid back to the council by the joint venture, so no further financial pressure is put on the authority, the council said.Worthing said that if the 100 market value homes are sold at a 10% profit, the council would return a surplus on its £12.5m investment in three years as part of a 50/50 profit sharing arrangement.The scheme will also include a 50-space car park made available for exclusive use of HMRC, which has a new digital hub building in the town.The report is asking the council to release £246,000 for the initial costs of the project, and is also seeking approval to enter a pre-purchase funding agreement with Vivid.