A council has approved a budget increase for a project to build affordable new homes following concerns of Gateway 2 approval delays by the Building Safety Regulator (BSR)
At a cabinet meeting on 13 November 2025, it was noted that Brighton and Hove City Council (BHCC) had approved planning permission for 306 new affordable homes at the Sackville Road Trading Estate in Hove earlier that month.
Developed by Homes for Brighton & Hove (HBH), a partnership between the council and the Hyde Group, supporting documentation at the November meeting highlighted that the projected costs for delivering the scheme had increased “due to a number of issues, including challenges in securing vacant possession of the site and changes to the design to respond to feedback in the planning process”.
The Cabinet was told that in the process of negotiating the construction contract, Hyde had identified a “significant risk” linked to the BSR Gateway 2 approval process.
“This approval is to be sought by the contractor, who should be ready to submit in late Spring. While the statutory approval period is 16 weeks, current submissions are taking between 40 and 50 weeks and could extend up to 80 weeks.
“Due to construction inflation, each week of delay adds significantly to the build cost, with a very significant impact if the full 80-week duration is realised,” the document read.
To mitigate the risk of processing delays, an amendment had been added to the build contract between HBH and the building contractor to include an inflationary layer cap:
“The contract includes a mechanism where additional costs are payable for each week of delay beyond 16 weeks, capped at 80 weeks, after which the risk sits with the contractor. The most likely scenario based on current delays is the process taking around 40 weeks. The maximum cost of the contract, therefore, includes up to 80 weeks delay, but the most likely scenario is that the actual contract price is significantly below this maximum.”
As a result, the funding requirement for the development and purchase of the affordable homes saw an increase of up to £2.6 million. Whilst this had been agreed by the HBH board, Cabinet approval was also required to proceed.
“A decision is required in November to ensure tight funding deadlines are met, and the project remains viable. The Homes England Strategic Partnership requires a start on site before the end of the financial year, and the build contract must be signed by December to start mobilising and avoid further price uplifts.”
Noting the progress made so far with the new affordable homes project, the Cabinet approved the £2.6 million budget increase. The council anticipates that construction will begin in early 2026, with completion expected in 2029. The development will provide 183 council-rented homes and 123 residences for shared ownership.
As reported by Construction News, Councillor Gill Williams, Cabinet Member for Housing at the council, said: “This is a flagship development for this council and will play an important role in our commitment to delivering thousands of new homes throughout the city. As such, we will be doing all we can to prevent any unnecessary delays in the process.
“We also welcome the measures being introduced by the government to tackle the backlog at the BSR. There is huge demand for these homes locally, and once finished, this development will be a fantastic place for people to call home.”