Elephant & Castle regeneration plan: High Court set to rule on social housing quota following crowdfunded legal challenge

The High Court will rule on the future of the regeneration of Elephant & Castle, in a test case over gentrification and cheaper homes for young Londoners.

Southwark council has approved redevelopment of the Elephant’s notoriously shabby shopping centre, with Mayor Sadiq Khan’s support.

But a crowdfunded legal challenge, which will be heard at the UK’s highest court in July, claims there are not enough low-cost homes included in the £1 billion scheme.

Of the 979 rental properties to be built by development giant Delancey, 116 will be for social rent — typically offered to those who would otherwise be eligible for a council flat, and charged at around £100 a week for a one-bedroom home.

Another 53 will be available for the London Living Rent, another social housing scheme, and will cost about £150 a week. Meanwhile, 161 will be rented under the banner of discount market rent, with an 80 per cent discount on market prices and aimed at households earning up to £60,000.

On the open market a one-bedroom build-to-rent flat in Elephant & Castle costs about £2,000 a month.

“Most of affordable housing is simply not affordable to people who live in Southwark,” said Jerry Flynn, who is leading the legal challenge. “If we agree we are in a housing crisis, then big developers should be meeting the most severe need for affordable housing first.”

Flynn grew up on the Elephant & Castle’s Heygate Estate. He points out that some 1,200 council homes were lost when the Heygate was demolished to make way for new homes, but are being replaced by only around 600 equivalently priced homes in the area.

A spokeswoman for Delancey said it was providing the maximum amount of affordable homes possible. “The total affordable housing offer … has been independently tested by Southwark’s own viability consultants who calculated the levels to be the maximum reasonable offer the scheme can provide,” she said.

The shopping centre redevelopment also includes a new base for London College of Communications and a new retail mall, and is seen as the crucial new “gateway” to Elephant & Castle. But there are also concerns about the fate of the shops and restaurants currently based in the shopping centre.

Delancey and Southwark are attempting to find new sites for 79 of the businesses based at the shopping centre and adjacent market, which include many restaurants and cafés run by the area’s South American community. So far 36 have been offered new units.

Delancey’s spokeswoman said that efforts to relocate the rest were ongoing and when the new shopping centre is built, 10 per cent of its shops will be offered to independent businesses at cut-price rents.

The legal dispute has won traders a temporary stay of execution. Last year Delancey said it was hoping to begin work on the decade-long building project in March this year. This has now been delayed at least until the High Court’s ruling is announced.

Paul Heron, of the Public Interest Law Centre, is the campaigners’ solicitor in the case. A victory could force Southwark to scrap the planning consent and begin the entire process again, potentially increasing the number of low-cost homes at the shopping centre. But it has a wider implication than one housing development.

“This is about gentrification, and how it is going too far,” said Heron. “Councils are getting rid of social housing without securing the equivalent on new projects.”