Shapley Heath Viability Study flawed

Hart Council has released the Shapley Heath Viability Study under a Freedom of Information request. At first glance, it looks as though the proposal is viable.

The summary shows 5,300 units in total, split 60:40 into 3,180 open market units and 2,120 affordable units of various types. This generates revenue of £1.68bn. It appears as though the discounted cash-flow gives a £32.1m surplus at the end of the project. This comes after an investment of £164m in infrastructure.

Shapley Heath Viability Study flaws

But, the good news ends there. There are three major flaws in the analysis:

• Mismatch between the viability study and the commitments made in the Shapley Heath bid
• Significant areas infrastructure are not even mentioned in either the study or the bid
• The infrastructure spend per unit is much lower than proposed at the Grazeley Garden Town just over the border in Wokingham/West Berkshire.

Let’s look at each area in turn:

Mismatch between viability study and commitments

The bid to Government for £150K to support further work on Shapley Heath Garden Village contained a number of infrastructure commitments:

These included 4 primary schools, a health centre and health garden. Railway station and car park improvements were also promised.

However, the sketchy costings in the viability study missed out key elements:

The eagle-eyed amongst you will note that it only mentions 3 primary schools and there is no mention of a health centre. It is debatable whether the railway station improvements are included in the “transportation” bucket. So, there is a primary school and a health centre missing.

The missing infrastructure

However, the issues don’t stop there. First, let’s continue the discussion about railways. They don’t give any detail on the proposed improvements to the station. Winchfield station car-park is already full on weekdays and the line is acknowledged to be running over-capacity. The station has short platforms too.

Already 500 houses are being built in north-east Hook. Hook station car park is also full. So, it is likely many of these residents will try and use Winchfield station. Adding a further 5-10,000 new houses at Shapley Heath is equivalent to adding as many houses as in Fleet parish today. This would put a massive further strain on the station. It is difficult to see how this could be accommodated at the current site. Indeed, a study in 2015 by Hart Council said that it might be appropriate to relocate the station to Murrell Green. The cost of this wasn’t calculated, but it is difficult to see how they would get change from £25m.

The road improvements mentioned do not seem to include:

• Improvements to the bridges over the railway on Station Road, Taplins Farm Lane and Pale Lane.
• Strengthening and widening the the bridges over the River Hart at the Queens Head, Dogmersfield and Pale Lane
• Improving the roads to the east side of the development including Taplins Farm Lane, Pale Lane, Chatter Alley/Pilcot Road through Dogmersfield to Crookham Village or Totters Lane.

It is difficult to see how they can improve M3 J5, the A30, B3016 and A287 as well as the above for the paltry £20m they have set aside. Remember the roundabout improvements on the A30 near Blackbushe cost £4m.

Moreover, the 2015 study also talked of a new juntion on the M3. This would likely cost around £100m. Of course, we don’t know how much, if anything they have allowed for re-routing the high-pressure gas main or burying the high voltage power lines or a new sewage works.

Lower spending per unit than Grazeley

Wonkingham and West Berkshire councils are planning the Grazeley Garden Town. This is for around 15,000 new homes just south of the M4 and west of the A33.  They suggest £750m of infrastructure spending is required for a town of this size. This equates to £50,000 per unit. The Shapley Heath viability study suggests £164m for 5,300 houses. This is around £31K per unit. The spending would have to increase by £101m to £265m to match the level of spending per unit at Grazeley.

Summary

We can estimate the extra spending required to match the commitments made and quantify the missing elements:

• Extra primary school: £5m
• Health Centre/Garden: £2m
• New railway station: £25m
• Additional road improvements: £20m
• Bridge improvements: £18m
• Total: ~£70m

We don’t know if they have set realistic budgets for re-routing the high pressure gas main, burying the power lines and building a new sewage works.

These extra requirements would likely render the project not viable, because it would more than wipe out the £32m surplus. Remember what Councillor Radley said:

Time to hold him to his word.

This is another of our posts showing:

• What is Shapley Heath, explaining its location and scale?
• All the reasons why Shapley Heath Garden Village is a bad idea
• An outline of an alternative approach to long term planning in Hart

The master page containing all of these posts can be found here. A link is also provided in the navigation at the top of the page.  Please do keep an eye out for further updates and share them with your friends.