'The dream and the reality' - Manchester and Salford's obsession with skyscrapers is coming at a cost

They’ll bring in 2,388 flats, a wave of amenities for residents like a dog spa, Mahjong room, and creators’ studio, and one could be the city’s tallest building, at 71-storeys. The five blocks — four of which are called Contour and climb to 47 or 51 storeys, with the tallest being Plot D — will be built next to Deansgate Square, already home to four steel-and-glass behemoths.

They all sit within the ‘Great Jackson Street Masterplan’ area, which the council has long designated as a skyscraper district. Renaker, the developer behind these towers, has included publicly-accessible amenities like retail and hospitality space, plus a public square, medical centre, and primary school.

On the other side of the Irwell, Henley Investments has drawn up plans to demolish the Regent Road retail park, and build 10 blocks of flats in its place. Six of these will be ‘towers’, comprising 3,300 flats, with the tallest also set to be 71-storeys tall — and therefore vying for the title of the tallest building outside of London.

“We can’t let the city centre living dream become the preserve of higher incomes”

But both of these schemes have come in for sharp criticism. In the heart of Greater Manchester, Renaker has permission to build 2,388 flats and Henley wants to build 3,300. Not a single home will be affordable, however. In both cases, the developers say they have not achieved the 20 percent profit margin necessary to include affordable housing in their projects, as current planning rules dictate.

And both schemes have come to the fore just as a Manchester council report found the dominance of constructing luxury flats in the build-to-rent sector ‘can result in the perverse impact of new supply ostensibly adding to the inflationary pressures in parts of the city where new development has been most intense’. In other words, the premium skyscrapers, with little to no affordable housing, are driving up rents across Manchester for everyone.

Now, politicians on both sides of the cities’ boundaries have criticised the lack of affordable housing coming in these landmark schemes — with Salford MP Rebecca Long-Bailey saying change is needed so those who cannot afford the average city centre rent of £1,433 per month can achieve ‘the dream of living in our city centres’.

“With the need for more homes in our city, developers will be looking to continue to build year on year, which makes it so important that the dream of living in our city centres is available to all, and doesn’t become the preserve of only those on higher incomes,” she told the LDRS. “Building little to no affordable or social homes in large scale new developments will sadly make the latter a reality.

“In Salford alone we have over 5,000 people on the housing waiting list, and almost 1,000 children living in temporary accommodation… The housing crisis needs addressing urgently, and while Labour’s plan to build millions of homes will help [across the UK], vitally we need new developments to include a significant amount of social and affordable housing in their plans, as well as providing financial support to existing communities through investment in local public service infrastructure such as schools, GP surgeries and parks, as well as road, cycling and pavement improvements.”

And according to Jonathan Moore, a Lib Dem councillor in Salford, not building affordable homes in the city centres will ‘consign those who most need help and support to an uncertain and precarious future’.

“In too many developments in the city we see the council allow developers to wriggle out of mandatory affordable housing targets – the promise is always ‘jam tomorrow, never today’,” he went on. “This practice needs tightening up and entire developments of social and affordable housing brought forward that benefit the people of Salford.”

Marcus Johns, a Manchester Labour councillor representing the Deansgate ward, also objected to Renaker receiving planning permission for Plot D and Contour, saying that the developers’ focus should now be on getting affordable homes in their new schemes after already delivering public amenities like the aforementioned school and medical centre.

“He expects that, in an area where a wide range of socioeconomic services have been provided through Section 106 and other contributions, that affordable housing would now be a focus, particularly in a development area with high sales values and strong commercial performance,” a summary of his comment said.

“This is not enough and we need private developers to help”

The debate on the lack of affordable housing often can descend into a blame-game, with councils coming for the firing line for granting the planning permission in the first place. But Bev Craig, Manchester council leader, says her authority has limited tools to combat the phenomenon.

“The current national system set out rules on viability… is currently a ‘one size fits all system’ with the same rules for London, where land values are higher, as everywhere else,” she said.

“We would like to see the national framework made more flexible to give us scope to deliver more affordable housing through the planning process and support the right development in the right places. We already demand a lot from developers investing in our city. We expect high quality developments, with excellent public spaces, alongside other impactful contributions – and this is at a time when inflationary pressures in the construction sector remains high.

“This means major development in Manchester does come at a premium to investors – and it’s not uncommon for developers to accept much lower profit rates here than expected through the national planning framework.”

In Manchester, it’s thought developers often get nowhere near the 20 percent ‘viability’ threshold required for affordable homes — with a source close to the planning process saying the typical average is ‘in the single digits’.

Manchester’s target is to build 10,000 affordable homes, and 26,000 more market-rate properties, by 2032. It’s understood some 200 city centre affordable homes have been built since this target was adopted, another 700 are being built now, and a further 270 are in the planning process — which would make up two-fifths of the city centre’s designated proportion of the 10,000 affordable homes.

However, Coun Craig says she’s going further, taking the issue to the top of the government — with Deputy Prime Minister Angela Rayner also heading up the housing brief.

“Although section 106 payments through the planning process are one route to support affordable housing, they have only ever accounted for a small proportion of affordable housing built here. What would be much more impactful for Manchester people would be a range of measures including national funding to help meet demand and maximising opportunities on brownfield land.

“We will continue our conversations with the government to press for a long-term, properly-funded home building programme which delivers affordable housing in the numbers that our city and country needs.”

In Salford, some 402 affordable properties were built last year. “This is not enough and we need private developers to help with this,” a Salford council spokesperson said.

The government’s plan

At the time of writing, Angela Rayner’s government department is consulting on major reforms to the planning system. Once they become law, the national framework will feature ‘golden rules’ which include ‘at least 50 percent affordable housing, with an appropriate proportion being social rent, subject to viability’ in projects ‘involving the provision of housing’.

The government line is that ‘it is necessary to allow the limited use of viability assessments’, which is where developers demonstrate their profit margins — and therefore show they can or cannot build affordable homes.

These will be used ‘where negotiation is genuinely needed for development to come forward, particularly in relation to affordable housing requirements’. But the government has ruled out using the assessments as ‘an excuse to inflate landowner or developer profits at the expense of the public good’. It’s worth saying that the ‘golden rules’ only apply to green belt land. When the LDRS asked what the plan was for brownfield land, no response was forthcoming.

It therefore remains unclear how — or if — such golden rules will impact cities like Manchester and Salford, which don’t have a lot of green belt. It’s also unclear what the viability threshold will be under the new rules.

“It needs a multi-faceted approach”

While Bev Craig delivered a hint of what Manchester wants from the new government in a ‘properly-funded home building programme which delivers affordable housing’, her executive councillor for housing revealed a more specific desire.

“We are in discussion with the new government to do more with accelerator funding and brownfield land funding,” said Gavin White in an economic scrutiny meeting last week. He also pointed to a ‘strong pipeline’ of affordable housing coming in the next few years — as mentioned earlier.

But in the face of criticism that adding housing supply, albeit mainly luxury, to the housing market was pushing up price, he insisted the answer was to ‘get more houses built’ although, he recognised, ‘that will help but it won’t do it alone… It needs a multi-faceted approach’.

He did not say what the other aspects of such an approach should be. But he did tell the committee housebuilding takes time, so it might take a few years before affordable numbers dramatically climb, as he hopes.

That, in turn, means questions over who really benefits from city centre development will rage for a period.