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Housing association and council terminate deal for £1bn regeneration scheme
A housing association and council have terminated their development agreement for a £1bn regeneration project.
Residents of Purfleet in Essex were informed by Thurrock Council on Tuesday that its plans to regenerate the town had been abandoned.
The plans included delivering 2,850 new homes, a medical centre and primary school.
The agreement between Thurrock Council and Purfleet Centre Regeneration Limited (PCRL) has now been terminated.
PCRL is a joint venture (JV) between housing association Sanctuary and developer Urban Catalyst.
Sanctuary, which confirmed the news with Inside Housing, became involved in the project when it completed a rescue of Swan, the original JV partner, in 2023.
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Following the termination of the agreement, Inside Housing understands that phase 1A of the regeneration scheme will still go ahead. This involves building 61 homes, which are set to be delivered by Sanctuary through Section 106 agreements.
In addition, a separate film studio project, Purfleet Studios, could still go ahead as it was not connected to the development agreement.
However, additional infrastructure for the scheme, including a new train station, had already been scotched after Homes England cancelled funding that had been assigned to the project from its Housing Infrastructure Fund.
Both Swan and Thurrock Council had experienced financial difficulties in recent years.
By the end of 2022, before its rescue merger with Sanctuary, Swan said it only had enough cash to fund its subsidiaries until “early December”. Meanwhile, Thurrock Council found itself in debt of about £1.4bn after a series of failed investments in solar farms.
A spokesperson for Sanctuary told Inside Housing: “We can confirm that the development agreement between Thurrock Council and Purfleet Centre Regeneration Limited has been terminated.
“Sanctuary has committed to the completion of the active phase of the development, which will deliver much-needed shared ownership and affordable housing for the people of Purfleet.”
Cllr Ben Maney, cabinet member for regeneration and highways at Thurrock Council, said: “Despite efforts by PCRL to secure funding it was clear that this could not be achieved on terms that were satisfactory to PCRL shareholders or Thurrock Council so we have now, with the agreement of the PCRL board, terminated the development agreement.
“The project has not been abandoned, the council remains committed to delivering high quality regeneration in Purfleet on Thames with the supporting infrastructure, town centre and station improvements, and this decision now allows us to move forward and consider alternative delivery options. We are working closely with Homes England and potential funding partners and intend to bring options before Cabinet soon.”
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