Croydon Council to offload resi developments

Croydon Council is ramping up a selling spree with two new schemes from its development pipeline brought to market. The council is seeking £20m for the 421-home College Green scheme and a further £20m for the 211-bedroom Croydon Park Hotel, which is being marketed as a build-to-rent, student or residential development opportunity. The hotel comprises a 137,000 sq ft building on a 1.54-acre site next to East Croydon train station. Croydon Council bought Croydon Park Hotel from Evans Randall in 2018. Last year the council took back control of the hotel after the leasehold operator Kasterlee UK went into administration. Croydon considered alternative uses including another hotel, student accommodation and temporary housing, but said development would not be viable and included it in a list of council disposals approved by the cabinet earlier this year. A sale at £20m, would be significantly under the 2018 purchase price of £29.8m. The College Green site spans two acres and has a resolution to grant planning for a 29-storey tower. The plans have been through various iterations, with Brick by Brick boosting the figures in a bid to generate income for the development after it lost out on a nearby site. The intent had been for Brick by Brick to develop the site to cover the £68m bill for the Fairfield Halls refurbishment and reap further profits to turn to the council. But the council has since switched strategy opting for the site sale at £20m, leaving it £48m out of pocket. Croydon recently declared itself effectively bankrupt and is currently facing a £66m hole in its finances. It has a large exposure to property investment, where it has seen income hit in the wake of Covid-19. The council has subsequently sought to sell Brick by Brick, with a buyer expected to be selected imminently. In February, Croydon approved plans to sell 15 surplus sites, including buildings in need of major refurbishment and vacant land sold for private development. This includes housing estate sites yet to be transferred to Brick by Brick. Earlier this year, Brick by Brick also agreed an 85-home bulk shared ownership sale earlier this year to Residential Secure Income, providing a further £29m to the business. Savills has been instructed to sell the two schemes on behalf of the council. Andrew Cox, development director for London residential development at Savills, said: “These two sites represent an unparalleled opportunity in Croydon. Both sites are incredibly well connected, very close to East Croydon station with rapid journey times into London. “Both have the potential to deliver much needed affordable and private housing to the borough or a range of other uses. We anticipate strong demand to come from London developers, hoteliers, student housing providers as well as the build to rent and co-living operators.”   To send feedback, e-mail emma.rosser@eg.co.uk or tweet @EmmaARosser or @EGPropertyNews