A property developer whose York apartment block turned into a ‘nightmare’ has been allowed to cut almost £1million from the amount it contributes to affordable housing in the city.
Councilors have reluctantly agreed to allow Marc Black and his company Modernistiq Developments to pay half the money from the Section 106 deal on the 62-flat block off Eboracum Way.
Mr Black bought the site after planning permission was granted in 2020 and originally intended to turn it into a student accommodation block, but construction has stalled after what he described as a series of “bad luck”, including the Covid pandemic, partners and contractors either pulling out or going bankrupt and unforeseen site costs – as well as spiraling inflation driving up the cost of construction.
“I’ve been doing this for 25 years,” he said. “I went through the crash of 2008-2009, just. I never had anything like this in my life.”
Section 106 agreements, signed between planning authorities and applicants, attempt to ensure that developments also benefit the local community.
Mr Black was forced to pay £1.9m in Affordable Housing Contributions but said the project would not be viable unless it could be reduced to just over £880,000. The calculation was supported by an independent review.
Mr Black said he just wanted the money he invested back and said the building would likely be turned into a hotel if he could not fund the project.
“I’m not here to beg,” he said, adding that he was having trouble at his portfolio sites due to construction inflation.
“We don’t think we want to be greedy and get more council money or make more profit,” he said. “Over there, it was the most horrible time I had experienced in years.”
He claimed sales were poor due to fears of a property crash and said young people now preferred to live ‘in the sticks’ rather than in the city centre.
Mr Black’s case attracted little sympathy from councillors, although most agreed it was better to have money for affordable housing than nothing. The council will also be able to recover money if the promoter makes more profit than expected.
But Cllr Michael Pavlovic said: “It’s the nature of capitalism – you make bad business decisions, you lose money. It is not the board’s job to bail out bad business decisions to the tune of a million pounds.
Cllr Janet Looker said they were given “a bloody history”.
“We heard at the Conservative Party conference that if we don’t appreciate and take the risks of market capitalism we are all becoming terribly difficult people and making England a terribly bad place,” he said. -she adds.
“Where do we end? Do we end up giving everyone a few million just to say “oh please, please go on and build”? »
Both said they did not believe the only viable alternative was a hotel or student block, and wondered if a social housing provider could take over.
Cllr Nigel Ayre said he believed Mr Black was not making any money from the scheme, adding that a bank taking over the site would not be a good outcome.
He said: ‘It’s the people of York and the council who lose out, but that’s the nature of capitalism. The capitalist will always profit from this system and we will lose out – we cannot change that overnight.