24 May 2013, 4:42 pm
The analysis of CIL rates for 18 of London's 33 boroughs shows that student accommodation developments face charges of as much as £10,000 per student bed which compares to a current average of around £2,000 per bed under section 106 agreements.
The increased CIL charges will threaten viability according to experts. "Some of the proposed CIL levels will deter companies from building student housing. It will distort the market considerably," said Philip Hillman, lead director in Jones Lang LaSalle's student housing team.
"Traditionally student housing developments have not had to provide affordable housing as part of their section 106 requirements and so this may be one of the factors that has resulted in some of the London boroughs proposing higher CIL charges on student accommodation when compared to what would have been secured under section 106," said Jamie Lockerbie, a planning lawyer at Pinsent Masons, the law firm behind Out-Law.com.
Student accommodation developer Unite has suggested that CIL is being used as a tool to prejudice development of student accommodation. Richard Simpson, the managing director of property at Unite and chair of the British Property Federation (BPF) student accommodation committee, said that the committee will fight the proposed rates at forthcoming public examinations of CIL draft charging schedules.
