NATIONAL HOUSING TRUST INITIATIVE
INFORMATION MEMORANDUM
24 November 2011
Contents
FOREWORD FROM KEITH BROWN, MSP Minister for Housing and Transport .....3
FOREWORD FROM BARRY WHITE, SCOTTISH FUTURES TRUST.............................4
THE NATIONAL HOUSING TRUST INITIATIVE: AN INTRODUCTION ........................5
THE PARTICIPANTS .................................................................................................7
THE PROCUREMENT PROCESS AND INDICATIVE TIMETABLE ................................9
BACKGROUND TO THE NHT INITIATIVE ...............................................................11
THE NHT STRUCTURE ...........................................................................................13
FUNDING STRUCTURE, LOCAL AUTHORITY BORROWING AND THE NHT CASH
CASCADE ..............................................................................................................17
THE NHT CONTRACTUAL ARRANGEMENTS .........................................................20
PROPERTY ACQUISITION STRATEGY ....................................................................22
PROPERTY SALES STRATEGY ................................................................................23
RISK ......................................................................................................................24
COUNCIL REQUIREMENTS AND PREFERENCES ....................................................25
ANNEXES ..............................................................................................................26
Annex 1- Aberdeen City Council ..........................................................................26
Annex 2- City of Edinburgh Council .....................................................................27
Annex 3 Clackmannanshire Council .....................................................................29
Annex 4- Dumfries and Galloway ........................................................................30
Annex 5- Dundee City ..........................................................................................32
Annex 6- East Lothian ..........................................................................................33
Annex 7- East Renfrewshire .................................................................................34
Annex 8- Falkirk Council .......................................................................................35
Annex 9- Fife Council ...........................................................................................36
Annex 10 - The Highland Council .........................................................................38
Annex 11- Midlothian Council .............................................................................39
Annex 12-Moray Council......................................................................................40
Annex 13-Renfrewshire Council...........................................................................41
Annex 14- Scottish Borders Council .....................................................................42
Annex 15- Stirling Council ....................................................................................43
Annex 16 – Current Local Housing Allowance (LHA) Rates for Participating Local
Authorities (November 2011) ..............................................................................44
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FOREWORD FROM KEITH BROWN, MSP Minister for Housing and Transport
In recent years the challenges facing the Scottish housing market
have been unprecedented. Not only have these challenges
contributed to economic volatility but they have put households
at risk and undermined our objective of sustainable economic
growth.
The Scottish Government is wholly committed to tackling these
challenges, despite the drastic cuts in Scotland’s capital
investment imposed by the UK Government. Fresh thinking and
new ideas are critical, not only to maximise the impact of the funding available but to
further support developers and local authorities in working together to deliver housing
solutions that meet their communities’ needs.
An Initiative at the forefront of our drive for innovation is the National Housing Trust
(NHT) Initiative which is delivering hundreds of affordable rented homes across the
country and supporting hundreds of jobs in the construction sector and wider economy
for very little taxpayers’ money. Contracts under Phase 1 of NHT have already been
signed in Aberdeen, Edinburgh, Highland, Falkirk and Scottish Borders with the first
homes expected to be complete early next year, and further signings are expected
shortly. Not only does this demonstrate the ability of this Initiative to deliver, but it also
shows the willingness of developers and local authorities to embrace the opportunities
offered by this new approach.
The helpful feedback we received from local authorities and developers about the first
round of NHT has demonstrated clear demand for further phases. To make the most of
the appetite and commitment to keep Scotland building, I am delighted to invite
potential development partners to consider this Information Memorandum and to
submit completed Pre-Qualification Questionnaires (PQQs) where they believe they can
satisfy the requirements of the Initiative.
The launch of this latest procurement offers developers an exciting opportunity to join
others at the forefront of innovation in housing delivery. I look forward to continuing our
groundbreaking work with local government, the Scottish Futures Trust, and housing
developers and funders to maximise the potential of the NHT Initiative.
Keith Brown MSP, Minister for Housing and Transport
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FOREWORD FROM BARRY WHITE, SCOTTISH FUTURES TRUST
The National Housing Trust is an innovative scheme which, as well as
helping to deliver affordable housing for rent in areas where there is a
shortage of appropriate accommodation, also helps support jobs within
the construction industry.
Such innovative projects are at the heart of Scottish Futures Trust’s work
to improve infrastructure right across Scotland whilst ensuring value for
money for the taxpayer. Phase 1 of this Initiative was launched by SFT in
late 2010 and contracts have already been signed with a number of
developers. In total, NHT is well on course to deliver a considerable number of new homes
which in turn should generate approximately £70 million of investment and support around
1000 jobs. The first of these new homes should be available for rent as early as the beginning
of next year.
The success of the first phase has given all stakeholders confidence that the market will be
receptive to the launch of NHT Phase 2 and SFT is delighted to be involved in this much needed
boost for the housing sector.
Barry White, Chief Executive of Scottish Futures Trust
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THE NATIONAL HOUSING TRUST INITIATIVE: AN INTRODUCTION
The National Housing Trust (NHT) Initiative
This Information Memorandum (IM) is designed to support developers and investors and
their partners in their understanding of the NHT Initiative, and to provide an outline of
the NHT procurement process and key facts in relation to the offering. Throughout this
IM, the phrase ‘developers’ and ‘private sector partners’ includes house builders,
housing associations, institutional investors and others with existing interests in land.
NHT is an innovative partnership approach aimed at boosting the supply of affordable
homes in Scotland. The Initiative is delivering housing for intermediate rent whilst at the
same time assisting economic recovery through supporting jobs in the construction
industry and wider economy.
The Scottish Government and Scottish Futures Trust (SFT) have worked closely with
developers and house builders, local authorities and lending institutions to develop NHT.
The Initiative enables local authorities to join with developers and their partners to make
more new affordable homes available for rent, on an intermediate rent basis, in areas
where there is demand for affordable housing.
The Initiative is jointly funded by participating local authorities and their chosen
development partners, with the Scottish Government underwriting any shortfall in the
repayment of local authority loans through the provision of a guarantee. Developers will
be expected to build the homes by securing short term development finance (or
alternatively using their own resources). Upon their completion, the developer, SFT and
the relevant local authority will jointly purchase the homes through a special purpose
vehicle, which will take the legal form of a Limited Liability Partnership (LLP). The local
authority’s contribution to the funding package will be a loan of between 65% and 70%
of the total development price. The developer’s contribution will be the balance of the
development price in the form of a loan note and an equity stake.
The LLP will then let the homes to tenants on Scottish short assured tenancies for a
period of between five and ten years, with management and maintenance services to be
provided by the developer and/ or its chosen partners during the period of the Initiative.
As highlighted above, the NHT homes must stay within the Initiative for a minimum
period of five years and, following that, the developer will have the right to call for the
sale of the properties. Upon sale, the local authority loans within the SPV will be repaid
first and any calls on the Scottish Government guarantee recouped. Thereafter, any sales
proceeds will be used to repay the developer’s loan and provide the developer with a
return on their equity stake.
Homes will be delivered into the Initiative through a competitive procurement process.
This process is outlined in this document.
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The current procurement is for Phase 2 of the Initiative. Phase 1 of NHT was rolled out in
2010-11 and so far has seen the successful conclusion of contract awards in five local
authority areas, which will bring hundreds of affordable homes for rent into the market
within the next few years.
Under Phase 1, construction has already started on some development sites with
occupation of the first new homes expected in early 2012. The Initiative has also helped
to shift thinking and debate beyond more traditional forms of housing investment and
feedback from both the public and private sectors demonstrates that there is strong
support to use NHT again. The Scottish Government, SFT and the participating local
authorities have responded to that demand by launching this second phase of NHT.
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THE PARTICIPANTS
Fifteen local authorities are participating in Phase 2 of the NHT Initiative and are seeking
completed Pre-Qualification Questionnaires (PQQs) from developers and their partners,
where applicable, who wish to take part in the Initiative. The local authorities
participating in NHT and their indicative unit requirements are detailed below:
Participating Local Authority
Indicative Number of Units to be
Procured
Aberdeen City Council
50 Units
City of Edinburgh Council
100 Units
Clackmannanshire Council
25-30 Units
Dumfries and Galloway Council
100 Units
Dundee City Council
75 Units
East Lothian Council
35 Units
East Renfrewshire Council
30 Units
Falkirk Council
100 Units
Fife Council
120 Units
The Highland Council
43-100 Units
Midlothian Council
75 Units
The Moray Council
20 Units
Renfrewshire Council
40 Units
Scottish Borders Council
100 Units
Stirling Council
36 Units
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Further detail is attached in Annexes 1-15 in relation to the requirements and
preferences of the individual local authorities participating in NHT.
Contact points
If you require any further information in relation to the Initiative or the contents of this
IM, please contact SFT by getting in touch with the following:
Clare Mills Tel: 0131 510 0808
E-mail: [email protected]
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THE PROCUREMENT PROCESS AND INDICATIVE TIMETABLE
The aim of Phase 2 of the NHT Initiative is to deliver hundreds of additional homes for
intermediate rent across the local authority areas set out on page 6. Each participating
local authority has set out in more detail its requirements and preferences in the
relevant Annex at the back of the IM. This includes, amongst other things, the number of
homes it may wish to procure, its preferred unit locations, unit types and sizes and
building standards. Ultimately going forward, the developer and its partners will need to
meet the minimum criteria in order to be considered for selection.
This IM and the associated PQQ have been published following publication of the related
OJEU Notice. The NHT Initiative will be procured under the restricted procedure in
accordance with the Public Contracts (Scotland) Regulations 2006. The restricted
procedure does not allow for any negotiation of the contract documents. SFT and the
participating local authorities will therefore only allow amendments which are genuinely
clarificatory. The suite of documents will be provided to those who are successful at the
PQQ stage. These documents will be heavily based on the contract documentation used
in NHT Phase 1.
The key documents can be found on SFT’s website
http://www.scottishfuturestrust.org.uk/publications/housing
As part of this procurement process, developers and their partners are now invited to
submit PQQ responses to participate in one or more Lots in the Initiative.
The procurement process has two key stages:
1. Pre-Qualification; and
2. Invitation to Tender (ITT) and Contract Award.
These two stages can be broadly summarised as follows:
Stage 1 – PQQ completion and return
This initial stage of the procurement process requires developers and, where applicable,
their partners, whether in the form of a consortium or a sub-contract arrangement, to
provide key information regarding their technical capability and experience, their
financial standing, their proposed sites in the participating local authority areas and their
policies, practices and performance in relation to elements such as health and safety and
equal opportunities.
The PQQ returns will be evaluated by the relevant participating local authority supported
by SFT with a view to short-listing a number of suitably qualified and experienced private
sector partners to deliver NHT. Those successful at this stage will be invited to proceed
to the ITT stage. Those unsuccessful will be notified accordingly.
The PQQ document itself provides further information on the requirements of and
approach to the PQQ stage. Developers are therefore now invited to review the PQQ
requirements and instructions and complete a PQQ response in relation to each Lot in
which they are interested. Potential private sector partners should read the PQQ
instructions carefully and return their completed PQQ response(s) by the deadline of 12
noon on 9th January 2012. PQQ response(s) received after this date may not be
considered.
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Stage 2 – ITT and Contract Award
Developers shortlisted following Stage 1 will be issued with the ITT, the response to
which will again be evaluated by the relevant local authority supported by SFT.
The award criteria will be set out in the ITT documentation. They may include, but may
not be limited to, the following:
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the price of the proposed development relative to its independent valuation;
quality enhancements to the base specification;
the quality of the proposed site;
the quality of the management and maintenance proposal;
the bidder’s position on the funding split (see p.17 ‘Funding Structure, Local
Authority Borrowing and the NHT Cash Cascade’);
ranking of locations (where specified by the participating local authorities);
the level of cap and / or sharing mechanism proposed in relation to the developer
return (the internal rate of return or IRR);
the developer loan note rate;
confirmation of the ability to fund construction;
space standards for units;
level of management, maintenance and insurance fee; and
deliverability (time within which units can be delivered and the key elements that
impact upon this e.g. planning and issue of warrants).
The contracts awarded under NHT will ultimately be awarded to the developers who have
submitted the most economically advantageous bid(s), based upon the ITT award criteria.
Following completion of the ITT evaluation, successful developers/consortium will be required
to submit a certificate of title. Provided that a satisfactory certificate of title has been provided
by the developer in a form agreed by the other parties, the successful developer(s)/consortium
will enter into the contractual arrangements with the relevant local authority and Scottish
Futures Trust Investments Limited (possibly subject to conditions precedent). This will allow,
where applicable, for construction of the NHT homes to commence, with their delivery upon
completion into the Initiative. Any already completed properties which are successful in the
NHT procurement process will be taken into the Initiative at an early stage.
Indicative Timetable
The indicative timetable for procurement is outlined below. This is included as a general outline
of timescales and may be altered at any stage. Those successful at each stage will be informed
of timescales and actual deadlines as required.
Key stages
Timescale
Publication of OJEU notice
24th November 2011
Deadline for receipt of PQQs
9th January 2012
Issue ITTs
27th January 2012
ITT returns
8th March 2012
Contract award
9th April 2012 onward
Contract signature
8th May 2012 onward
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BACKGROUND TO THE NHT INITIATIVE
Policy context
The Scottish housing system is facing unprecedented challenges. The economic situation
has put pressure on all parts of the housing system, with demand for affordable housing
expected to increase at a time when the Scottish Government, local authorities and the
house-building industry are facing increased constraints on the amount of funds at their
disposal. Despite these challenges, the Scottish Government is committed to increasing
the supply of affordable housing across Scotland. This reflects its recognition not only of
the growing demand for such homes, but of the vital role that housing has to play in
Scotland’s economic recovery.
Innovative funding and delivery models are essential to address housing need and to
boost affordable housing supply. Achieving high value for money, stimulating
construction activity and supporting employment form key parts of achieving this
objective, helping deliver the Scottish Government’s housing solution. Consequently,
the NHT Initiative has been designed specifically with these aims in mind. By developing
partnership working between the public and private sectors, NHT is delivering hundreds
of affordable homes for rent across the country, whilst also supporting jobs in the
construction industry and the wider economy – around £100 million of investment
generates support for over 1,000 jobs in the sector.
Target tenant groups
In most cases, the Initiative is expected to provide homes to households on low to
moderate incomes who are likely to struggle to afford private renting at market rents or
to buy a home, but who are also unlikely to be able to access social housing in the near
future. Each participating local authority has also set out in the Annexes the tenant
groups it would expect NHT homes in its area to be made available to based on its
evidence of need and demand pressures. The SPV, with the approval of the Scottish
Ministers, may agree to broaden or change the target tenant group(s) during the
operational period.
Demand for intermediate rent housing
The NHT Initiative aims to help meet housing need in particular areas where there is
expected to be demand for affordable housing for intermediate rent (please see the
Annex relating to each local authority you are interested in for details of specified areas).
Rent levels are set initially by each participating Council. This starting rent level will be
fixed at the point of ITT and will reflect the local authority’s position on affordability,
taking account of their local rental market. The relevant contracts will set out the details
in relation to how rent increases may be dealt with. Annex 16 details the November 2011
LHA rates for the relevant local authorities participating in NHT for information purposes
only. Going forward further information can be found at:
http://scotland.gov.uk/Topics/BuiltEnvironment/Housing/privaterent/tenants/money/localhousingallowance/Figures1/2011/November
Participating local authorities have used their local knowledge to determine the locations
and number of homes they plan to procure. They have used existing Local Housing
Strategies, Strategic Housing Investment Plans, information arising from Housing Need
and Demand Assessments (HNDAs) and analyses of the types of clients on housing
waiting lists.
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Developers are encouraged, however, to undertake their own assessment of market
demand for both the NHT offering (i.e. rental demand) and likely demand for the homes
during the NHT exit sales process. To assist this process, individual local authorities may
be able to provide information in relation to the demand analysis they have carried out.
However, again, interested parties must rely upon their own investigations, assessments
and professional advice prior to deciding to participate in the NHT Initiative.
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THE NHT STRUCTURE
The NHT Initiative involves an ongoing, medium term relationship between the public
and private sectors, with the key features of this relationship being:
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transparency;
a clear governance and funds flow process;
an appropriate allocation of risk and return; and
minimising the administrative burden on participating partners.
The following diagram summarises the structure of the NHT Initiative
As the above diagram highlights, there are five key stakeholders in NHT:
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participating local authorities;
developers and their delivery partners (e.g. construction subcontractor,
management and maintenance providers);
the Scottish Government;
Scottish Futures Trust Investments Limited (SFTI) (a wholly owned subsidiary of
SFT); and
the Initiative’s tenants.
There will be a number of separate LLPs, one for each of the successful developments.
This approach has been adopted to:
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eliminate the risk of cross-liabilities between developments for different lots
e.g. the potential returns or surplus on one site being affected by losses on
another; and
ensure that all borrowing by a local authority will result in lending to an LLP
whose sole purpose is to provide housing within that local authority’s area.
It is a requirement of the Initiative that each development must have a minimum
capacity of 15 units (developments with a capacity for fewer than 15 units will not be
considered). Unless otherwise stated in the particular local authority annex, a
development can be made up of multiple sites in order to meet this minimum capacity
requirement. However, bidders should note that where it is proposed that a
development consists of multiple sites, all sites must have detailed planning permission
at the time the bidder enters into the contract documents.
The LLPs themselves will be limited liability partnerships (LLPs). The LLP members (as
opposed to shareholders for a limited liability company) will be the relevant local
authority, SFTI and the developer. The primary reason for such a structure is that it
provides tax transparency and efficiency for the Initiative. The tax treatment of any
returns to the members, and in particular that of the developer, will reflect that of the
developer on a standalone basis, and as such the LLP members will settle their own tax
liabilities rather than the LLP. Developers and their partners should satisfy themselves
with the proposed arrangements in relation to the NHT structure and taxation approach.
The LLPs will be formed prior to contract signature. This will allow all the legal
documentation to be executed and entered into (including the developer joining the
LLP). Certificates of title must be provided by the developer and agreed with SFT and the
local authority within four weeks from the date that the developer is notified that it is
successful i.e. contract award as outlined earlier. Any title defects that are capable of
remedy by the developer, by the time that the units are transferred into the LLP, will be
listed in the Take-out Agreement. In the event that there are defects which are not
capable of being remedied, the development may be rejected. Following contract
signature, construction can commence immediately where new build properties will be
built for delivery into the Initiative.
The LLP itself will only purchase homes under the Initiative once they have been
satisfactorily completed by the developer. A fixed purchase price for the homes will be
bid by the developer at ITT stage. A Take-Out Agreement will provide an undertaking
from the LLP to the developer that, provided the homes are completed within an
acceptable timeframe and to the desired standard and any title defect has been
remedied, the LLP will complete the purchase of the proposed properties.
The delivery of homes on a site can be in phases. This may especially be used where
large numbers of homes are being provided on a single site by a single developer.
Phasing of the homes’ delivery will also allow the marketing of properties to be managed
and controlled by the developer’s managing agent/ delivery organisation.
Governance-wise, each LLP will have its own board of management. The relevant local
authority and SFTI will each appoint one representative to the board, while the
developer will appoint two representatives to reflect its key responsibility in delivering
the day-to-day operations of NHT i.e. the management and maintenance of the homes.
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Maintenance and Management Services
It will be important that NHT homes are well managed to ensure that tenants receive a
good service and also that homes and estates are well maintained in order to protect
their value. The provision of management and maintenance services, such as marketing,
letting, collection of rents, repairs and maintenance, customer services for tenants,
factoring and managing processes when tenants are required to leave, will be the lead
responsibility of the developer. Management and maintenance providers will be
required to meet minimum standards regarding service provision to tenants. These
standards will be set out in the Management and Maintenance Agreement and will be
broadly in line with the standards expected by the Scottish Core Standards for
Accredited Landlords (as detailed below).
It is important that those providing management and maintenance services have suitable
experience. Therefore, where a developer does not have such experience, they should
seek to work with an organisation that can demonstrate its ability to meet these Core
Standards. The developer could either form a consortium with its management and
maintenance partner(s) or consider sub-contracting its management and maintenance
obligations to a suitable partner(s). In NHT Phase 1, these partners included both
housing associations and private letting agents.
Regardless of the approach to partnering for the management and maintenance
services, it will be a criterion for participation in NHT that the managing agent must be
one of the following:
 an organisation accredited by Landlord Accreditation Scotland;
 an organisation which is a member of an equivalent landlord or letting agent
accreditation scheme which requires its members to meet standards equivalent
to the Scottish Core Standards for Accredited Landlords; or
 an organisation that provides confirmation and information to demonstrate
that it operates to these core standards. Where an organisation only currently
carries out certain elements of the functions covered by the core standards, but
would be likely to be required to carry out others through the NHT, the
organisation should set out in its PQQ response (Schedule 3) how it plans to
ensure it meets those requirements it does not currently carry out (for example,
this could include plans to register as an agent with the local authority or plans
for the management of tenants’ deposits).
A developer which does not carry out the management and maintenance functions itself
can choose to provide management and maintenance services through one or more
agents. Therefore, for example, all services could be carried out by one suitably
experienced agent or a separate agent could be used to carry out the management of
the tenancies and internal repairs/ maintenance and another would be used to carry out
the factoring/ external and common area maintenance function. In completed PQQ
responses, details must be provided on the experience and standards of each of the
organisations directly providing management or maintenance.
At ITT stage, developers will be able to propose the fixed fee they will receive for:
(a) the provision of management and maintenance services. This fee is to cover any
costs to the developer in providing, arranging or contracting for the provision of
management and maintenance services and factoring costs for the NHT homes on a
site; and
(b) the costs of insuring the properties and the LLP.
Maximum fees will be set out in the ITT and developers will not be permitted to propose
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fees which exceed those maximums. Both fees will increase annually by CPI.
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FUNDING STRUCTURE, LOCAL AUTHORITY BORROWING AND THE NHT CASH
CASCADE
Introduction
The LLP will only purchase properties upon their satisfactory completion. At this point,
the LLP will access funding from the local authority to meet a proportion of the purchase
price, with the remaining value of the homes effectively the ‘locked in’ value of the
developer.
Funding Split
An LLP will be established for each development within a local authority area. If a
developer has more than one development in a local authority area then these may be
combined to form a single LLP.
On completion of a phase, the LLP will fund its obligation to purchase the properties by
raising 65-70% of the total purchase price through a loan from the local authority. The
total purchase price will include the purchase of the properties and the related fees
(including the reasonable monitoring surveyor’s costs). The remaining balance of funding
(30-35%) will come from the private sector in the form of a loan note (5%) and equity
(25-30%). NB: it should be noted that the local authority loan in The Highland Council
and Scottish Borders Council areas will be limited to 65% of the total purchase price.
Elsewhere, the developer will be able to propose the exact funding split that would apply
to its development(s), and this will be detailed at ITT stage. The funding split will form
part of the quantitative scoring for the ITT evaluation, with higher scores awarded to
bidders proposing a higher percentage of private sector funding.
Scottish Government guarantee
A Scottish Government guarantee will underwrite the local authority lending and will be
available to meet any interest or principal shortfalls in terms of its lending. The
guarantee will not extend cover to the private sector funding or the operational
performance of the LLP.
The Scottish Government guarantee will be available to the local authority from the date
the properties are purchased by the LLP and will expire upon the earlier of: the full
repayment of the local authority debt; and a period of 10 years from the date upon
which the last phase of housing is purchased.
In the event that there is a claim on the guarantee during the life of the NHT (e.g. if
rental income were insufficient to meet a local authority’s interest payments due to
increased void levels), the Scottish Government would recoup any funds paid out under
the guarantee from the LLP at the point when the LLP begins to make a surplus.
Alternatively, if the LLP does not return to making a surplus at all before homes are sold,
the guarantee sums due will be recouped from any surplus earned on the sale of the
homes.
Interest Rates and Return
The rate of interest charged on the local authority loan to the LLP (which is then paid to
the developer at the point at which completed properties are purchased) will be around
the prevailing Public Works Loan Board (‘PWLB‘) rate at the time the ITT is issued. Such
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an approach will provide certainty going forward and the local authorities will then take
the risk of interest rate movements during the period from setting the rate to loan
drawdown.
Local Authority Debt Terms
Upon the purchase of the properties, the local authority will initially provide a fixed term
loan for a minimum of 6.5 years to the LLP (longer initial loan terms can be provided
subject to the development remaining viable) in relation to a phase of housing being
delivered. Such an approach has been adopted to balance the potential requirement for
sales under each phase following the end of year five, whilst minimising breakage costs
for early repayment, and to manage interest rate risk going forward. Following the
completion of the initial fixed term, any debt outstanding will be refinanced through
either the PWLB or an alternative funding source available to the local authority, should
that offer better value for money. The basis (i.e. the source, term and rate) of any
refinanced tranche of debt will be for the developer to set, subject to ensuring any
lending facilities are repaid prior to the maturity of the Initiative following year 10.
Regardless of the funding arrangements, sales may take place before the maturity of any
loan as developers will have flexibility to trigger the sale of the properties, either as a
whole or in tranches after year five. This is why the private sector partner will be
responsible for any breakage costs (or receive any breakage benefit) as a result of
repaying the fixed term loan(s), or any future loan arrangements, early.
Repayment and Return
The NHT funding approach is predicated on the core principle that private sector
investment in the Initiative will be structurally subordinated to the public sector monies.
When the properties are sold in the future, the sales proceeds will be applied as
described in the contract documents. Funds will be applied to repay the loan from the
local authority, and to recoup any calls on the Scottish Government guarantee, before
private sector investment is repaid through the loan note and return provided on equity.
The public sector will expect to receive any proceeds from the sale of properties above a
capped Internal Rate of Return (IRR) to the private sector. The IRR capped to the private
sector is assumed to be 20% p.a. (post application of tax) however this is open to
competition during the tender process. Developers willing to set a lower level of cap, or
share profits when they pass a lower IRR threshold, will score more highly against the
associated criterion.
Cash Cascade
Elements of the NHT cash cascade are highlighted above, however, the following
summary highlights how rental income and sales proceeds are envisaged to be applied
under the Initiative:
Rental Income
Upon rental income flowing, it is envisaged sums received will be applied in the following
way:
1. payment of the LLP’s day to day operating costs and expenses including, but not
limited to, all its ordinary administrative overheads, fees payable under the
Management and Maintenance Agreement, taxes and any transaction costs and
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expenses;
2. payment of interest due on the local authority borrowing;
3. reimbursement of any amounts due under the Scottish Government guarantee;
4. funding of the NHT reserve account (which will be available to meet any shortfalls in
performance prior to calls on the Scottish Government guarantee); and
5. payment of interest due on the private sector loan note.
If any residual balances are available after making the above payments, such sums will
be applied, where there are not punitive costs to do so from repaying debt early, in the
early repayment of the local authority borrowing and thereafter any calls on the Scottish
Government guarantee, the loan note and the provision of return.
Upon the exit sales process commencing, whether in part or in full, it is envisaged that
sales proceeds will be applied in the following way:
1. as per 1. above (but only to the extent that such costs and expenses relate to the
properties which are being sold);
2. as 2. above;
3. in full repayment of the local authority debt principal (adjusted for any breakage
costs or gains);
4. as 3. above;
5. as 5. above;
6. in full repayment of the private sector loan note;
7 to repay the developer’s equity, to the extent that such payment will at that time
result in the developer receiving an IRR not exceeding 20% p.a. (post application of
tax) on its overall investment in the LLP; and
8. To pay to the LLP (by way of overage) any residual amount of sales proceeds less the
LLP’s initial capital.
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THE NHT CONTRACTUAL ARRANGEMENTS
Upon the conclusion of the procurement process a series of contracts will be executed
by the key parties to the Initiative: the relevant local authority, Scottish Government, SFT
and the developer.
The following table provides a high level summary of the key contract documents
underpinning NHT and their purpose. The contract documents will be provided to those
developers who are successful at PQQ stage and are issued with the ITT. The generic
contract documents used in NHT Phase 1 on which the Phase 2 contract documents will
be heavily based can be found on the SFT website (excluding the Scottish Government
Guarantee Agreement).
Document
Purpose
Members’ Agreement
(among the SFTI, the participating
Regulates the relationship amongst the partners
local authority, the developer and the in an LLP
LLP)
Facility Agreement
(between the participating local
authority and the LLP)
Regulates the respective obligations attached to
the loan finance coming from the local authority
to the LLP
Guarantee Agreement
(between the Scottish Ministers and
the participating local authority)
Provides a guarantee to the local authority in
relation to its loan finance to an LLP
Take Out Agreement
(among the SFTI, the LLP, the
participating local authority and the
developer)
Enables the LLP to purchase the properties at an
agreed price on satisfactory build completion
(principally a turnkey development agreement)
Management and Maintenance
Agreement
(among the SFTI, the participating
local authority, the LLP and the
developer)
Inter Creditor Agreement
(among the Scottish Ministers, the
participating local authority, the LLP
and the developer)
Deals with the tenant groups and all property
management functions, including repairs and
maintenance, rent collection, arrears, common
charges, letting, administration etc
Regulates the loans to an LLP and repayment of
these loans
Other Documents
Other standard documents which will also be provided include:
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






a standard model short assured tenancy agreement and an ‘AT5’ document
(which specifies that a tenancy would be a short assured tenancy), which
managing agents will be expected to ensure all tenants enter into. LLPs will be
able to agree to add or amend certain elements of the agreement if they wish,
for example, if a tenancy deposit will be required from the tenant;
standard missives;
a standard monitoring surveyor appointment;
a style certificate of title;
a style floating charge;
a style deed of assignation; and
a style retention bond.
Private sector partners should note that the units will be purchased by the LLP only once
properties on a site have been signed off by the monitoring surveyor as being complete
to an agreed specification.
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PROPERTY ACQUISITION STRATEGY
Properties to be considered for acquisition through the NHT may be either:

completed but unsold new build properties; or

properties which are either partially developed or where construction work has
not yet started. Potential private sector partners under the Initiative will be
required to complete the construction of these properties before they are
purchased by the relevant LLP. The Initiative will not fund site construction
works.
To be considered for acquisition, sites must be located within the target area(s)
identified by each local authority (see Annexes 1-15). Local authorities may rank areas
within their overall boundaries in order to reflect particular needs or pressures within
their locality – where any ranking has been identified this is set out in the relevant local
authority Annex. Higher marks will be awarded against the relevant criterion to sites
within areas of high priority than to those in lower priority areas. Details of the scoring
for preferred areas will be set out in the individual local authority’s ITT.
In order to tender for the NHT, a developer must either own or have a legally binding
option to purchase a site(s) in one of the areas set out by local authorities in Annexes 115. Units to be delivered on sites which are not in full developer ownership or which do
not have a legally binding option contract will not be considered.
NHT properties are expected to be completed and transferred to the relevant LLP prior
to a date being three years from signature.
Where a developer does not have full planning permission to develop properties on a
site or may require changes to their planning consent to build properties for the NHT,
the developer should factor this in when setting out timescales for delivering the
properties on that site. Bidders should note that where it is proposed that a
development consists of multiple sites (in order to make up the minimum number of 15
units for a development), all sites must have detailed planning permission at the time
the bidder enters into the contract documents. It should be noted that acceptance of a
bid to the NHT by a local authority does not in any way provide a guarantee that
planning consent would be provided for the relevant site.
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PROPERTY SALES STRATEGY
The NHT Initiative will last for between five and 10 years after completion of each phase
of the properties. Under such a requirement properties must be available to rent for a
minimum period of five years. Thereafter, it will be for the developer to determine when
a sale should take place between the sixth and tenth year.
Sales will take place on an arm’s length basis and it will be for the developer to
determine whether sales occur in a single phase or multiple phases between the sixth
and tenth year.
Ultimately, all exits must be complete by year 10, as the Scottish Government guarantee
will expire at this point. The exit for all parties from the Initiative therefore relies on the
sales of the stock held by the relevant LLP and as such forward planning will be required
to ensure that properties are sold prior to the end date of the NHT Initiative.
In terms of the sales process, the members agreement will lay out the relevant process,
which will include offering a right of pre-emption to sitting tenants and a local authority
nominee (such as another public sector body or a registered social landlord) at market
value. If neither entity wishes to exercise this right, then the private sector partner will
have the right to effect a sale on an arms length basis.
It is envisaged that the properties will be sold at market value.
In terms of vacant possession for sales, tenancies will be let under short assured tenancy
agreements and therefore the recovery of vacant possession (where required) will be
achieved by giving the tenant(s) notice to quit. Local authorities may wish to offer
tenants housing options interviews before their tenancy ends. Alternatively, if a local
authority nominee buys the properties or a portfolio of properties is sold to an investor
or entity which wishes to continue renting out the properties with existing tenants
remaining in place, appropriate arrangements would need to be put in place to keep
tenants informed of developments (how tenancies will be impacted) and ensure that the
buyer was committed to fulfilling any statutory duties in relation to the tenants.
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RISK
During the development of NHT, careful consideration has been given to the key risks
attributable to the Initiative and appropriate risk sharing between the public and private
sectors. The aim of the Initiative has not been to transfer risk to the private sector as an
end in itself, but rather to create the right incentives and disciplines to achieve a better
value for money outcome for NHT.
To this end, the main risks that the developer, and its partners where applicable, will be
expected to retain can be summarised as follows:

planning;

construction/ delivery;

funding during construction;

property management (including tenant management, voids, factors and
marketing);

property maintenance;

refinancing interest rate;

exit strategy (including timing and unit profile);

affordable rent levels; and

sales.
The NHT Initiative has been structured to enable the developer to effectively manage
these risks.
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COUNCIL REQUIREMENTS AND PREFERENCES
Annexes 1-15 contain the housing requirements for each of the local authorities taking part in
NHT Phase 2. In many cases, the local authorities have also stated their preferences, where it is
possible to do so at this stage of the procurement. It is important to note the distinction
between a requirement and a preference. So, for example, a local authority may be willing to
look at developments within any part of their local authority area (it being a requirement that
the development is sited within their area) but would prefer for developments to be sited
within particular parts of that area e.g. brownfield sites or specified towns/villages etc. (these
are preferences).
To proceed to ITT stage proposed developments must meet the minimum requirements of the
relevant local authorities. Proposed developments that do not meet those requirements will be
excluded and will not be considered further. Preferences though will be scored at ITT stage in
accordance with the evaluation criteria set out in the ITT documentation to be issued to
shortlisted developers.
The local authorities’ individual requirements together with the evaluation criteria will be set
out in more detail, in the ITT.
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ANNEXES
Annex 1- Aberdeen City Council
Approximate number of units being sought
Unit types (e.g. flats and detached houses)
Size of units (e.g. 2-bed and above)
In the region of 50 units
Flats or houses
Primary need is for 1 bed.
2 bed would also be
considered
Location(s) of units (ranking areas by
preference where applicable and noting any
areas to be excluded)
Any location within Aberdeen
City
Target tenant group(s)
Existing tenants of the Council
or RSLs and applicants to the
Council or RSLs in the Council
area. This will include
homeless applicants.
NHT delivery meets the
Affordable Housing Policy
(“AHP”) within the Local
Development Plan.
2010 Building Regulations
Affordable Housing Policy position
Minimum building standards e.g. 2010
Building Regulations
Indicative Starting rent level (as a % of LHA)
Up to 90
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Annex 2- City of Edinburgh Council
Approximate number of units being
sought
Unit types (e.g. flats and detached
houses)
Size of units (e.g. 2-bed and above)
Location(s) of units (ranking areas by
preference where applicable and noting
any areas to be excluded)
Up to 100 units
(Minimum on a site – 15 units
Maximum of 100 units on a site.)
Flats and Houses
1, 2 and 3 bed (mix of unit sizes if
bringing forward sites of more than
20 units)
Any location within City of
Edinburgh Council boundary.
Locational Preference
Projects which are located in areas
which do not have an
existing concentration of Affordable
Housing will score more highly.
A concentration of Affordable
Housing is defined as a Datazone
within Edinburgh which has 50% or
more of its households living in
social rented tenure. Further details
can be provided upon request.
Further locational preferences may
be stated in the ITT.
Target tenant group(s)
Households earning a minimum of
£10,000 per annum.
Affordable Housing Policy position
NHT units will count towards the
AHP policy requirements
Minimum building standards e.g. 2010
2010 Building Regulations or the
Building Regulations
standards contained within an
existing planning consent in
situations where the Council is
satisfied that construction has
already commenced.
Indicative Starting rent level (as a % of Up to 100
LHA)
Advertisement of Lets
All NHT homes will require to be
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advertised through the Council’s
Edindex and Key to Choice system
for letting homes
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Annex 3 Clackmannanshire Council
Approximate number of units being
sought
Unit types (e.g. flats and detached
houses)
Size of units (e.g. 2-bed and above)
Location(s) of units (ranking areas by
preference where applicable and
noting any areas to be excluded)
Target tenant group(s)
Affordable Housing Policy position
Minimum building standards e.g.
2010 Building Regulations
Indicative Starting rent level (as a %
of LHA)
In the region of 25 units (up to max of
30)
Any.
Larger houses are preferred but small
flats/houses will also be considered.
3 and 4+ bed preferred.
1 bed units will be considered
2 bed units will be considered, if part
of a development containing a mix of
sizes.
Affordable housing required across the
whole of Clackmannanshire area.
There are 3 sub Housing Market Areas.
Particular priority given to: regeneration areas and especially
Alloa South and East
 Hillfoots HMA
 small units in Dollar HMA
 large units in Alloa HMA
Priority will be given to brownfield
sites
Likely to be small, newly forming
households who cannot afford to buy.
Large households who are currently
overcrowded who cannot afford to
buy or rent privately.
Target household incomes will be
minimum £14,000 for smaller units
and lower quartile (average £16,950)
up to £29,000 for larger units.
NHT units will count towards AHP.
Housing for Varying Needs or latest
building regulation requirements.
85
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Annex 4- Dumfries and Galloway
Approximate number of units being
sought
Unit types (e.g. flats and detached
houses)
Size of units (e.g. 2-bed and above)
Location(s) of units (ranking areas by
preference where applicable and
noting any areas to be excluded)
Target tenant group(s)
In the region of 100 units
Flats and houses
2, 3 and 4 bed
Preference for the following areas:
Annandale and Eskdale – Boreland,
Brydekirk, Canonbie, Chapelknowe,
Dirrops, Dornock, Eskdalemuir, Gair,
Hightae, Johnstonebridge, Kirtlebridge,
Lochmaben, Lockerbie, Moffat,
Nethermill, Rigg, Rowanburn, Sibaldbie,
Templand, Westerkirk, Yesket.
Nithsdale – Ae, Amisfield, Auldgirth,
Bankend, Beeswing, Burnhead,
Carronbridge, Carrutherstown,
Closeburn, Collin, Cummertrees,
Dumfries, Dunscore, Glencaple,
Holywood, Kelton, Kirkmahoe, Kirkton,
Locharbriggs, Lochfoot, Moniave,
Mouswald, New Abbey, Park, Penpont,
Shawhead, Terregles, Thornhill,
Torthorwald
Stewartry – Auchencairn, Borgue,
Bridgeof Dee, Castle Douglas, Corsock,
Crocketford, Crossmichael, Dalbeattie,
Dalry, Dundrennan, Gatehouse of Fleet,
Gelston, Glenlochar, Kippford,
Kircudbright, Krikgunzeon, New
Galloway, Old Bridge of Urr, Palnackie,
Portling, Prestonmill, Rhonehouse,
Ringford, Springholm, Twynholm
Wigtown – Newton Stewart, Palnure,
Portpatrick, Sandhead, Sorbie,
Stoneykirk, Stranraer, Whauphill,
Whithorn, Wigtown
any other area may be considered
Households on low to moderate
incomes who are currently on RSL
waiting lists and who are not currently
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Affordable Housing Policy position
Minimum building standards e.g.
2010 Building Regulations
Indicative Starting rent level (as a %
of LHA)
in a priority group for accessing social
rented housing. Qualifying households
need to have a maximum income of
£25,000. Priority will also be given to
housing applicants who can
demonstrate a local connection.
NHT units will satisfy Affordable
Housing Policy
2010 Building Regulations
100
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Annex 5- Dundee City
Approximate number of units
being sought
Unit types (e.g. flats and detached
houses)
In the region of 75 units
Houses and Flats
Preference for a mix of types within site
bids, subject to compliance with the Local
Plan.
Size of units (e.g. 2-bed and above) All ( subject to meeting local planning
requirements)
Location(s) of units (ranking areas
by preference where applicable
and noting any areas to be
excluded)
Preference for 2 and 3 bedroom units.
LHS Regeneration areas including
Hilltown, Lochee, Mill o Mains and
Whitfield.
Inner City.
Existing allocated Greenfield sites / sites
with existing Planning Permission.
Broughty Ferry.
Target tenant group(s)
Affordable Housing Policy position
Minimum building standards e.g.
2010 Building Regulations
Indicative Starting rent level (as a
% of LHA)
West End.
Minimum income level £15,000
Maximum income level £25,000.
No affordable housing policy applies
Must meet Building Regulations in force
at the time of applying for Building
Warrant.
90
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Annex 6- East Lothian
Approximate number of units being
sought
Unit types (e.g. flats and detached
houses)
Size of units (e.g. 2-bed and above)
Location(s) of units (ranking areas by
preference where applicable and noting
any areas to be excluded)
Target tenant group(s)
Affordable Housing Policy position
Minimum building standards e.g. 2010
Building Regulations
Indicative Starting rent level (as a % of
LHA)
In the region of 35 units
Any house type
1 and 2 bedrooms preferred.
Other sizes will be considered.
Anywhere in East Lothian, with
preference for the east of the
county i.e. Dunbar, Haddington
and North Berwick.
Other areas will be considered.
Households earning between
£18,000 and £30,000 per annum
NHT Homes are not recognised as
meeting Section 75 Affordable
Housing Contribution
2010 Building Regulations
85
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Annex 7- East Renfrewshire
Approximate number of units being
sought
Unit types (e.g. flats and detached
houses)
Size of units (e.g. 2-bed and above)
Location(s) of units (ranking areas by
preference where applicable and
noting any areas to be excluded)
Target tenant group(s)
Affordable Housing Policy position
Minimum building standards e.g.
2010 Building Regulations
Indicative Starting rent level (as a %
of LHA)
In the region of 30 units
Flats or terraced/semi detached houses
preferred. Detached would be
considered.
1, 2 and 3 bedroom considered
(preference for 2 bedroom)
First preference for G44,G46, G76, and
G77
Second preference G78
Smaller households already resident in,
or having a local connection with, East
Renfrewshire. These are likely to be
younger, newly forming households
who are in employment but unable to
purchase their first home.
It is unlikely that NHT units would be
deemed to meet the terms of our
current Affordable Housing Policy.
2010 Building Regulations
100% for first preference, 90% for
second preference
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Annex 8- Falkirk Council
Approximate number of units
being sought
Unit types (e.g. flats and
detached houses)
Size of units (e.g. 2-bed and
above)
Location(s) of units (ranking
areas by preference where
applicable and noting any areas
to be excluded)
Target tenant group(s)
Affordable Housing Policy
position
Minimum building standards e.g.
2010 Building Regulations
Indicative Starting rent level (as a
% of LHA)
In the region of 100 units
Any house type. Houses and cottage flats
preferred
2 bedroom and above.
Preference is for developments offering a
mix of unit sizes, with the majority being 2
bedroom units, but also including some
larger family homes.
All areas within Falkirk Council will be
considered. Preference for areas with
affordable housing shortfalls as follows:
P1a – Larbert, S’muir & Rural North
P1b - Falkirk
P2 – Polmont & Rural South
P3 – Denny & Bonnybridge
P4 - Bo’ness
P5 – Grangemouth
Households within median income deciles
3-5 (£15k - £25k). In exceptional
circumstances ( in areas P1(a) and P2
above) this could increase to decile 6
(£31k).
NHT units will satisfy the AHP requirements
2010 Building Regulations and ideally
comply with HVN standards and Secure by
Design Standards
85
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Annex 9- Fife Council
Approximate number of units
being sought
Unit types (e.g. flats and
detached houses)
Size of units (e.g. 2-bed and
above)
Location(s) of units (ranking
areas by preference where
applicable and noting any areas
to be excluded)
Maximum total across all Fife Phase 2
projects of 120 units.
Any house type will be considered up to a
maximum of four storeys.
Only projects with 50% or more 2-bedroom
dwellings.
High Priority
 Dunfermline and the Coast Local
Housing Strategy (LHS) Area
 Kirkcaldy LHS Area
 St. Andrews LHS Area
Low priority
 Largo and East Neuk LHS area
 Cupar and Howe LHS area
 Tay Coast LHS area
Target tenant group(s)
No other LHA areas will be considered
Households on the Fife Housing Register/
homeless list who are:
 In employment.
 Have a maximum household
income calculated as 4 times the
applicable rent plus £4000
(rounded to the nearest thousand).
 Have insufficient points to access
social housing in their area of
choice (the precise criteria of
suitable applicants will be provided
in writing by the Council).
 Household size must be appropriate
to the number of bedrooms.
Council may approve in writing that an
applicant for housing falls within the
‘target tenant group/s’ despite the above
criteria.
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Affordable Housing Policy
position
The Council will only accept proposals for
NHT units which it considers to broadly
meet the requirements of its affordable
housing policies. The assessment of
tenders will in no way prejudice any
subsequent (and separate) assessment of
applications for planning consent.
Council will also review what has
previously been issued through the
planning application process (e.g.
Affordable Housing Requirement
statement, or conditions of consent) and as
conditioned within any S.75 agreement.
For sites where planning consent has
already been sought Council will only
accept NHT proposals which it considers to
be in-line with any statements/documents
issued to date by Council.
Minimum building standards e.g.
2010 Building Regulations
References include: Fife Structure Plan
2006-2026 & Affordable Housing
Supplementary Planning Guidance (SPG)
(20 September 2011).
2010 Building Regulations.
Indicative Starting rent level (as a 95
% of LHA)
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Annex 10 - The Highland Council
Approximate number of units
being sought
Unit types (e.g. flats and
detached houses)
Size of units (e.g. 2-bed and
above)
Location(s) of units (ranking
areas by preference where
applicable and noting any areas
to be excluded)
Target tenant group(s)
Affordable Housing Policy
position
Minimum building standards e.g.
2010 Building Regulations
Indicative Starting rent level (as a
% of LHA)
43 units approved but could be increased
to a maximum of 100 units subject to
committee approval
Flats and houses
2 bed units and above
1st ranking preference: Inner Moray firth
area ,
Other preferred areas: Fort William,
Aviemore, Portree, South East Sutherland.
Any other area will be considered
Key workers and economically active who
cannot afford outright purchase
Does not currently comply with Highland
Council affordable housing policy due to
temporary nature of tenancy.
2010 Building Regulations
90
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Annex 11- Midlothian Council
Approximate number of units
being sought
Unit types (e.g. flats and
detached houses)
Size of units (e.g. 2-bed and
above)
Location(s) of units (ranking
areas by preference where
applicable and noting any areas
to be excluded)
Target tenant group(s)
Affordable Housing Policy
position
Minimum building standards e.g.
2010 Building Regulations
Indicative Starting rent level (as a
% of LHA)
In the region of 75 units
Flats and houses
2 & 3 bedrooms preferred. Other sizes will
be considered.
Bonnyrigg, Dalkeith, Danderhall, Loanhead,
Newtongrange, Penicuik, Poltonhall and
rural areas preferred. Other areas will be
considered.
Households in employment
Acceptable as part of AHP
2010 Building Regulations
85
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Annex 12-The Moray Council
Approximate number of units
being sought
Unit types (e.g. flats and
detached houses)
Size of units (e.g. 2-bed and
above)
Location(s) of units (ranking
areas by preference where
applicable and noting any areas
to be excluded)
In the region of 20+ units
Flats or houses.
Mainly 2 bed/3 person units but some
1bed/2 person units would be acceptable.
Other sizes will be considered
1st Ranking: Elgin Local Housing Market
Area
2nd Ranking: Forres or Speyside LHMA
Units in the following areas would not be
considered:
 Buckie;
 Keith.
Any other locations within the Moray area
will be considered
Target tenant group(s)
Households at lower quartile Moray
income band, i.e.£10-23,000 annual
income
Affordable Housing Policy
As a general principle, we would be willing
position
to consider the NHT units as a contribution
towards the affordable housing
requirement on a site or as an off-site
contribution in relation to a different site.
Agreement on this would be specific to the
site.
Minimum building standards e.g. 2007 Building Regulations (where already
2010 Building Regulations
built) otherwise 2010 Regulations Building
Regulations
Indicative Starting rent level (as a 90
% of LHA)
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Annex 13-Renfrewshire Council
Approximate number of units
being sought
In the region of 40 units
Unit types (e.g. flats and
detached houses)
Size of units (e.g. 2-bed and
above)
Location(s) of units (ranking
areas by preference where
applicable and noting any areas
to be excluded)
Flats and houses, however houses
preferred outwith town centre areas.
2 bed and above preferred, however 1 bed
would be considered
Renfrewshire wide.
The locations will be considered on the
basis of preference ranking with sites
within higher preference areas scoring
more highly at procurement. The
preference raking of locations is as follows:
Target tenant group(s)
Affordable Housing Policy
position
Minimum building standards e.g.
2010 Building Regulations
First preference: Paisley
Second preference: North and West
Renfrewshire
Third preference: Renfrew, Johnstone and
Elderslie
Fourth preference: any other location
Households on low – modest incomes
(around £15k and up to £27k). Initially
properties will be targeted at those on the
council or housing association waiting lists
and those who have approached the
Council and partners for housing options
advice.
No affordable housing policy applies
2007 Building Regulations for existing
developments, otherwise
2010 Building Regulations
Indicative Starting rent level (as a 90
% of LHA)
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Annex 14- Scottish Borders Council
Approximate number of units
being sought
Unit types (e.g. flats and detached
houses)
Size of units (e.g. 2-bed and above)
Location(s) of units (ranking areas
by preference where applicable
and noting any areas to be
excluded)
Target tenant group(s)
Affordable Housing Policy position
Minimum building standards e.g.
2010 Building Regulations
Indicative Starting rent level (as a
% of LHA)
In the region of 100 units
Houses preferred to flats, but flats
acceptable.
2 Bedroom and above preferred
I bedroom will be considered
All Scottish Borders Council area
considered.
Preference will be given to Galashiels,
Hawick,Newtown St
Boswells,Peebles,Coldstream,Duns,
Eyemouth and Kelso
Families and people who are in
employment who are unable to secure
high priority for RSL rented housing
Potentially also providing for people with
particular needs , e.g. core and cluster
housing.
NHT units are considered as an
acceptable Affordable Housing delivery
option as per the Council’s Affordable
Housing Policy.
2010 Building Regulations
85
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Annex 15- Stirling Council
Approximate number of units
being sought
Unit types (e.g. flats and
detached houses)
Size of units (e.g. 2-bed and
above)
Location(s) of units (ranking
areas by preference where
applicable and noting any areas
to be excluded)
Target tenant group(s)
Affordable Housing Policy
position
In the region of 36 units
Flats preferred but houses will also be
considered
1 and 2 Bedroom preferred but other sizes
will be considered
Stirling City Centre
Callander
Doune
Balfron
*this is subject to further consultation and
other areas will be considered
Single people or couples with low support
needs.
NHT units will meet affordable housing
policy. (note: policy is in course of review)
Minimum building standards e.g.
2010 Building Regulations
2007 Building Regulations for
developments already in progress
otherwise 2010 Building Regulations
Indicative Starting rent level (as a 90
% of LHA)
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Annex 16 – Current Local Housing Allowance (LHA) Rates for Participating
Local Authorities (November 2011)
The table of information below provides the current November 2011 LHA figures by
broad rental market area.
Broad Rental Market Areas
1 Bedroom 2 Bedrooms 3 Bedrooms 4 Bedrooms
Aberdeen and Shire
Dumfries and Galloway
Dundee and Angus
Fife
Forth Valley
Greater Glasgow
Highland and Isles
Lothian
Renfrewshire / Inverclyde
The Scottish Borders
£115.38
£80.77
£76.15
£80.77
£84.23
£91.15
£91.15
£114.23
£80.77
£73.85
£144.23
£98.08
£103.85
£101.54
£103.85
£115.38
£109.62
£138.46
£102.69
£92.31
£160.38
£107.31
£137.31
£115.38
£126.92
£137.31
£126.92
£173.08
£121.15
£106.15
£207.69
£132.69
£184.62
£173.08
£173.08
£207.69
£155.77
£253.85
£183.92
£144.23
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