Back to work: after a near-three-year hiatus, construction has restarted on the Cherryfield’s Meatpackers site on Cherry Orchard Road
As recent examples including Homes for Lambeth, Brick by Brick and the calamity at The Fold demonstrate, meeting a 1.5m new homes target in five years is fraught with difficulties. BARRATT HOLMES, housing correspondent, reports on the case of 120 flats at East Croydon
Builders are back on the old Meatpackers’ building site on Cherry Orchard Road, almost three years after the original contractors went bust and stiffed a housing association for £36million.
Taken alongside the serious issues suffered by residents who moved into the Queen’s Quarter development that opened in 2022, the Meatpackers site in East Croydon provides another example of the difficulties that local MP Steve Reed and the Labour government will have in hitting their self-imposed target of 1.5million additional new homes this parliament.
Planning permission for the site of the former Cherryfield’s Meatpackers factory at 40-60 Cherry Orchard Road was granted in 2019. Optivo, the housing association, and Henley Homes proposed to build a seven- to nine-storey building with 120 homes.
Then came covid, which stalled most development work across the country.
But building works came to a complete halt on the East Croydon site in 2023 when contractors Henley Construct went bust.
Optivo was by this time in the midst of a lengthy and complicated merger process with Southern Housing, creating one of the country’s largest housing associations (or what most people would recognise as landlords), managing 30,000 homes for nearly 80,000 residents in London and the south east.
One of the newly merged landlords’ first major problems was a multi-million-pound hole in their construction budgets caused by the collapse in May 2023 of Henley Construct, affecting works on the Cherry Orchard Road site and several others.
The estimated total loss to Southern Housing was reported by their liquidator earlier this year as more than £36million – money that will not be recovered, and money that can now never be used to pay for resumption of works at East Croydon and elsewhere.
According to a report by Henley Construct’s liquidators, the contractor had been “engaged in a number of substantial projects building residential units for HAs”.
The final progress report from 360 Insolvency Ltd said the “respective HAs have claims pursuant to contract terms for loss and damage suffered as a result of the termination”.
One in the Eye: Steve Reed will have problems delivering 1.5m homes, if examples in the borough he is supposed to represent are anything to go by
A subsidiary of Southern Housing submitted a claim to the liquidators for £36,045,633 which they said “reflect[s] the cost of works under those contracts”.
Henley also went down with trade and expense creditors totalling £6.7million.
Only now, after almost three years, has the housing association been able to budget to appoint a new contractor to work on the Cherry Orchard Road site.
Addiscombe West councillor Sean Fitzsimons said this week that he will provide locals with more information about the Cherry Orchard Road project once he and his council colleagues “get a full update from Southern Housing on timescales”.
Perhaps they’ll be finished by the time that the Bridge to Nowhere is open on both sides of the railway tracks?
Read more: The Fold folds: Hundreds of tenants given six months to leave
Read more: Croydon shamed over ‘dangerous squalor’ in council flats
Read more: ‘I don’t think it’s helpful you ask questions like this’ says MP Reed
Read more: #TheLabourFiles: MP Reed, Evans and the Croydon connection
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