Home ContractsHAR6182 London Dock Jade Wharf

HAR6182 London Dock Jade Wharf

WAC ID:589944

Public SectorAward noticeClosed2023/54

Source:	Find a Tender Service (FTS)
Notice Type:	Award notice
Buyer:	Tower Hamlets
Main Category:	Works
Procurement Method:	Direct award
Method Rationale:	The Council, relying on paragraph 5 of Schedule 5 to the Procurement Act 2023 intends to award a contract to SGCL and SGPLC for the delivery of housing on the Sites (as described in this notice). The following conditions are met in relation to the public contract: (a) due to a particular supplier having intellectual property rights or other exclusive rights, only that supplier can supply the goods, services or works required, and (b) there are no reasonable alternatives to those goods, services or works. SGCL own the Site and SGPLC are developing the wider ‘Estate’ in which the Site sits. Accordingly, SGCL are responsible for the construction of and the laying of the major services and infrastructure which will serve the Site. Such services and infrastructure will remain in the ownership of SGCL. Further, the council is taking a lease of units within a block, with the rest of the units remaining in the ownership of SGCL. On this basis it is not commercially feasible or workable from a technical or engineering perspective for another contractor to construct the Site on behalf of the Council. The Site is located within an area of housing need for the Council and is designated for residential development in the Council’s Local Plan. The Site already has detailed planning permission and so far as the Council is aware this is the only Site in the area which has planning permission and can deliver the scale of the affordable housing required by the Council to meet local housing need. The Council has secured GLA grant funding to assist with its acquisition of the Site. Under the terms of the GLA grant, the Site must be delivered by the GLA grant utilisation date of 31 March 2030. So far as the Council are aware there are no other schemes in the locality that can be delivered to the scale and cost of the Site in the timescales required to use the grant it has secured. Whilst the Council will become the owner of the Site at ‘golden brick’, the Development Agreement that the Council will enter into will cover the golden brick works and beyond. In addition as referred to above, since SGCL own the Site and SGPLC are developing the wider Estate and will be responsible for the services an infrastructure it is not commercially feasible or workable from a technical or engineering perspective for another contractor to construct the Site on behalf of the Council as this would likely cause significant interface issues which would likely result in the Council incurring a substantial and disproportionate amount of additional cost.

Description

The London Borough of Tower Hamlets (the Council) has identified an opportunity to acquire 68 affordable housing units at Block G, Jade Wharf, London Dock, Wapping (the Site). The Site is currently owned by St George City Limited (SGCL) and St George PLC (SGPLC) are the contracting organisation in terms of the construction works. Both companies are subsidiaries of Berkeley Homes (BH). SGPLC is developing residential housing as part of the next phase of the Jade Wharf scheme (the Scheme). The planning permission and associated s106 agreement obtained for the Scheme requires SGCL to sell the affordable flats to be delivered, to a Registered Provider, which in this case would be the Council. As part of the Scheme, the Council has agreed to acquire 68 affordable units as set out below. When the construction of the units reaches “golden brick” stage (above foundation level – being the point at which the units are treated as a zero-rated supply for VAT purposes) the Council will purchase the long leasehold interest from SGCL (so the Council becomes the owner of the land on which the 68 affordable units are to be delivered). This is a lease within an apartment block. The Council will also, at the same time pay SGPLC the costs associated with the delivery of the works up to “golden brick”. The Council will also enter into a Development Agreement with SGCL and SGPLC for the delivery of the 68 affordable housing units. The Development Agreement will place a legally enforceable obligation on SGCL and SGPLC to commence and deliver housing on the Site in accordance with agreed specification requirements as set out in the Development Agreement. The Council will pay for the costs of the works associated with delivering the affordable housing units in monthly instalments. The completed outputs will then be handed over to the Council’s ownership on practical completion. The opportunity offered to the Council by SGCL and SGPLC comprises two linked transactions: (i) the purchase of the long leasehold interest and “golden brick” works that the 68 affordable housing units are to be delivered on by the Council from SGCL; and (ii) the award of a works contract (Development Agreement) by the Council to SGCL and SGPLC. The Council considers these to be inseparable components of the transaction which can only be delivered by both SGCL and SGPLC. For the reasons set out in this notice, the Council considers that only SGCL would be able to deliver the works because of exclusive rights (SGCL’s current ownership of the Site) and that there are no reasonable alternatives to these works.

HAR6182 London Dock Jade Wharf

Procurement timeline

Award outcome

Contracting Authority

Description

Links & Documents

About Tower Hamlets

Similar contracts