Public procurement notice: Concession Award Notice
Published: 2021-04-16
Buyer: London Borough of Havering
Country: UK
Contract type: Works
Procedure: Concession award without prior concession notice
CPV classification: 45111000 | 45112700 | 45112710 | 45112711 | 45211300
Estimated value: 1177000000 GBP
Award criteria: Other

Technical requirements: LB of Havering (‘the Council’) entered into a contract for up to 30 years for a partner to form a long-term corporate joint venture (‘JV’) property vehicle to secure investment and expertise to deliver Havering’s housing led regeneration strategy, entered into 27 April 2018 (‘the Contract’). The opportunity was advertised in OJEU (2017/S 094-185114) and procured under the Concession Contracts Regulations 2016. Further details of the original Contract are in that OJEU Notice. The Contract includes a Members’ Agreement (MA) and Development Agreement (DA) with the JV LLP and other ancillary documents.
The Council has made additional funding available, refreshed the JV’s business plan and modified the DA. Further information can be found in the Council’s supplement document, at the web address in section II.2.4) below.
The information in the supplement document should be read in conjunction with this notice and both documents should be considered as a whole.
Further info is at https://www.havering.gov.uk/downloads/download/876/veat_notice_supplement_documents
1) Made additional GBP 58.3 million equity funding available to JV. Also, refreshed JV business plan (BP) to include Council forward funding of GBP 45.4 million for phase 1 (in the light of additional 53 affordable housing units and reduction of open market units from 1085 to 934, changes to design and other factors);
4) Amended DA to bring forward timing of demolition of Waterloo Estate and Council providing additional GBP 7.8 million financing in place of debt funding (some changes to be made by variation to the DA and a new supplemental dev agreement with JV).
Please note, the duration field takes into account the fact that the concession started 11 December 2020.
Please explain in a clear and comprehensive manner why the award of the contract without prior publication in the Official Journal of the European Union is lawful, by stating the relevant facts and, as appropriate, the conclusions of law in accordance with the directive:
Assessed individually and cumulatively, items 1–5 (as referred to in II.2.4) are all within the scope of the original OJEU/procurement and would not have affected the outcome (‘Procurement Outcome’).
The Council additionally/alternatively relies on Reg. 43(1)(a) (clear, precise, unequivocal review clauses), (c) (unforseeability), (e) (non substantial amendments — i.e. there is no material change in character of the contract, no considerable extension of scope, no distortion of competition and no change in the economic balance in favour of the contractor) and also Reg. 31(6)(b)(ii) as further described below:
The forward funding described in Change 1 and also Changes 2 and 3 are part of the annual business plan refresh, are within procurement scope and do not result in a change to the contract.
1) Re. additional equity funding: there is no increase in the Council’s peak net investment, no impact on the risk profile and no change in the economic balance. No change to the contract.
Re. forward funding: this is required due to a stagnant housing market eroding land value (impacting viability), build cost inflation, design enhancements, reduction in private sale cross subsidy and more affordable and family sized housing. These features would have applied to all bidders and the Council considers the Procurement Outcome would not have been impacted. Further, schedule 8, para 1.3 included scope to adjust Low Cost Unit Sum pursuant to VFM Standard and Code of Practice of Homes and Communities Agency;
2) Re. removal of the delta estate from current programme; this is a development phasing detail as no commitment was made to developing out the delta estate at this point in time, it was not tested as a sample scheme during the procurement process. Neither bidding behaviour nor Procurement Outcome would have been impacted;
3) Re. additional sites, these were within the OJEU notice scope and are similar to the sample sites tested as part of the procurement. Their delivery is consistent with financial and technical commitments in the tender to apply to subsequent schemes. The addition of further sites was transparently set out in the procurement documentation, is subject to an agreed mechanism and was incorporated into the evaluation questions. The Council alternatively relies on Reg 43(1)(a) (clear, precise, unequivocal review clauses).


Winner: Wates construction Ltd
Award value: 1177000000
Number of bids: 1