The draft London Plan is essential reading for anyone who wants to know where the capital is headed as it is the keystone of mayoral strategies and one of the most powerful tools the mayor of London has to define the shape of London.

Martha Grekos

However, at 524 pages the draft London Plan is not a streamlined strategic document. The mayor of London, Sadiq Khan, is looking to make his mark with a flagship policy agenda and set the tone for his next three years in office. As such, the London Plan, come 2018, will be under enormous pressure to deliver.

But can the plan deliver its target of 65,000 homes each year, up by more than 22,500 homes when compared with the current plan, with some boroughs’ targets more than doubling? Is it pro-growth, putting delivery centre stage? My concern is that the viability threshold approach is here to stay.

Sadiq Khan

Sadiq Khan is looking to set the tone for his next three years in office

Source: Shutterstock/Martin Hoscik

The 35% affordable housing threshold for viability purposes will remain in place until at least 2021, while the strategic target remains set at 50%. Interestingly, boroughs may consider applying localised affordable housing thresholds (more than 35% where possible) in opportunity areas.

Where a minimum of 35% affordable housing is offered (50% for public sector land), applications can follow a ‘fast-track route’ so that viability information does not need to be provided and scrutinised.

Negative effects on delivery

For schemes to follow this route, they must adhere to the affordable housing tenure split referred to in the plan. Schemes that do not adhere to these requirements must follow the ‘viability tested route’.

The greatest area of concern is the increased use of review mechanisms in section 106 legal agreements.

”Can the plan deliver? My concern is that the viability threshold approach is here to stay”

The supplementary planning guidance requirement that viability reviews are carried out in certain circumstances, with a view to increasing the affordable offering, also becomes embedded in policy. It is clear that the mayor is very keen on using this tool with the aim of augmenting affordable housing delivery in line with any uplift in developer profit.

While the aspiration of maximising affordable housing delivery is fully understood, review mechanisms risk increasing the cost of finance on any projects that will be subject to review due to the longer-term risks and uncertainty, which could have negative effects on delivery. Yes, there needs to be a collaborative and transparent approach to viability assessments, but there also needs to be a shared understanding of the development process.

Martha Grekos is partner and head of planning at Howard Kennedy