Affordable housing scrapped from city development

Affordable housing has been scrapped from a massive city centre housing development.

When planning permission was granted for 383 studios and flats on the former Harlequins shopping centre site in Exeter it was agreed there would be 20% affordable housing aimed at key workers.

But now developers will pay Exeter City Council at least £2m instead after a planning committee voted to approve the move on Monday.

Exeter City Council said the agreement would "result in the delivery of affordable housing elsewhere in the city, whilst improving the viability of the scheme".

Planning permission had been given in 2022 on the basis 20% of the homes would be affordable units for private rent.

A report prepared for the council's planning committee said there had been "extensive pre-application engagement" between the council and Guernsey-based developer Curlew Alternatives Property which established the scheme was no longer financially viable under those terms.

The report said: "The developer has stated that the scheme is not viable to deliver, due to rising construction costs, falling property values and higher interest rates since planning permission was granted."

Diana Moore is leader of the Green Party on the city council and a councillor for St David's ward, where the development is located.

Speaking to oppose the deal at the meeting she said affordable housing had been a "crucial part" of the planning approval and the change would "add to the systemic housing failure in Exeter".

A housing crisis in Exeter was identified in a major report in 2024 and Moore said it was particularly acute "for single people for whom the options are dwindling and expensive".

Planning permission was previously granted for two "co-living" blocks with 276 studios and 107 bedrooms with shared kitchen and dining areas.

Anne Jobson, Conservative group leader, told the meeting: "My suspicions are that co-living will end up as student living in due course, and Exeter won't see any benefit from it."

Under the agreed deal the developer will have to pay the city council £1m when the main structure of the shopping centre is demolished which is expected to be in the summer of 2025.

It will then have to pay a further £1m when ground works start and up to £5.5m depending on how profitable the development is.

Exeter City Council said the financial contribution would not be "restricted to the delivery of affordable private rent units and could be spent on other affordable housing tenures, including social rent".

No representative from the developers spoke at the meeting.

The BBC has requested a comment from the developer's agent, JLL.

Additional reporting by Guy Henderson, Local Democracy Reporter.

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