Lord Street development recommended for refusal

Proposals to be considered by planning committee on Monday

Plans for a 12-storey development on the site of the former Lord Street Bus Station have been recommended for refusal at next week's planning committee.

The proposals include a multiscreen cinema, bus information centre, 85 apartments and parking.

A report due to go before the planning committee on Monday says the proposals would represent a significant development on one of the more prominent sites in Douglas, which has been underutilised for decades.

It says the design will not be to everyone's tastes, and it would result in a significant change to the character and openness of the street scene.

The planning application received a number of comments from the public raising concerns about the development.

Among the issues raised were the building being too tall, the project being out of character with the area, and a lack of affordable housing.

The application from Lord Street Development SPV Ltd includes the construction of 85 residential apartments. Planning policies advise 25 percent of properties in new developments be designated as affordable homes, but that hasn't been included in this project.

It concludes that the proposal has a number of benefits - including the provision of bus stands, a waiting room and drivers' welfare facilities - but the non-provision of affordable housing and public open space are too great a departure from planning policies to approve.

In response to the publication of the planning report, Lord Street Development SPV Limited has issued a statement, which says: "We fundamentally disagree with the sole reason for refusal set out in the Officer’s Report for PA25/90516/B. The recommendation is expressly grounded in the conclusion that:
“It is considered from the detailed evidence provided and representations received from Estates and Housing that the proposal is a viable development and one which could provide Affordable Housing and Public Open Space provision either physically on site or as a commuted sum.”

"That conclusion is said to rely on evidence from the Department of Infrastructure (DOI). However, the DOI’s own memorandum expressly states:
“This informs the opinion that Developer Profit should be classified as 20% GDV as the target profit margin for housing delivered on the open market. This aligns with the Developer Profit set down in Lichfields Insight Paper when applied to market housing.”

"Yet the DOI’s own Development Viability Appraisal (Rev. B) demonstrates returns materially below that benchmark, approximately 19% before contributions and circa 17% once commuted sums are applied.

"On DOI’s own figures, the scheme does not meet the stated 20% viability threshold. It is therefore internally inconsistent to conclude that the development is “viable” and capable of absorbing Affordable Housing contributions when the appraisal relied upon does not achieve the benchmark return set out in the same memorandum. This is not a matter of interpretation. It is a clear numerical inconsistency.

"For the avoidance of doubt, we are not proposing “no affordable housing”. We have proposed a formal, legally binding review-linked mechanism, operating on an audited, open-book basis, to be assessed post Practical Completion when the actual outturn costs, revenues and returns are known. If the scheme outperforms and generates surplus above the agreed benchmark, Affordable Housing contributions would be paid in accordance with the agreed formula. If it does not, the scheme is not rendered undeliverable by fixed obligations imposed at the outset.

"The Lord Street proposal represents an £80 million regeneration investment in Douglas. Its viability is highly sensitive to delay and cost inflation. A refusal founded on contradictory viability evidence materially risks rendering the scheme undeliverable. We are seeking urgent clarification from DOI and the planning authority prior to Committee. Any decision must be based on coherent, transparent and defensible evidence."