A prototype “building-up” scheme that could have paved the way for cash-strapped inner-city schools to be revamped in exchange for new homes on their sites has been shelved.
LocatED, the Department for Education’s property company, has spent more than £180,000 drawing up plans to redevelop St James Hatcham C of E Primary in south London through the creation of 100 homes.

But the project – the only one of its kind the company was working on – has been put on hold in part because of planning requirements.
It comes after the new government vowed to shake up the “antiquated planning system” whose restrictions have delayed “too many projects” for years.
Matt Byatt, the president of the Institution of Structural Surveyors, said the case highlighted a “disconnect between what the developer wanted to do and what the planning process allows”.
“[Red tape] is an issue in so far as getting developments built.
“We need to be clear as a nation over what we want – a system where it’s easier for developers to build or one where [council] planners have the authority to push for what they think is appropriate.”
Housing on the upper floors
St James Hatcham would have been replaced with a new building. Its sports hall was earmarked for space across the ground floor, with classrooms on the level above.
Housing was to be spread across the block’s upper floors.
Papers obtained through Freedom of Information show LocatED was commissioned to work on St James Hatcham in February 2021.
In all, £183,274.80 was spent on the project before it was “placed on hiatus in late 2022”. The documents say the government-backed company “has not had any other commissions for advice” on such “building-up” schemes.
Will Attlee, its associate director, said last year the scheme would “rebuild that school on the existing site … [and is] fully funded by the development of around 100 new homes. This is clearly something that works in city centres, but not everywhere.”
Community infrastructure levy
The development was put on hold after appraisals suggested that the scheme was not viable at the time.
One of the reasons for this was Lewisham Council’s community infrastructure levy contribution, through which it charged up to £100 for every square metre of new living space.
Much of the levy backs improvements to travel, education, medical and sporting facilities in the area, while some was collected on behalf of London Mayor Sadiq Khan to fund Crossrail.
The decision to pause the project was also made in light of market conditions, including construction costs and falling house prices, and the level of affordable housing.
Planning policy stated half of the homes built would have had to have been affordable.
A spokesperson for the Diocese of Southwark, which oversees St James Hatcham, stressed “all parties” still believed it was “a viable and exciting scheme”. It hoped “to revisit this possibility when market conditions improve”.
Lewisham council added its “developer contributions allow us to invest in key community facilities”.
Shortly after Labour’s election win, Chancellor Rachel Reeves said the “antiquated planning system” left too many projects “tied up in years and years of red tape before shovels ever get into the ground”.
She announced the launch of a consultation, which closed last month, on planning policy reforms to create “a new growth-focused approach” and mandatory housing targets.
LocatED’s future
LocatED was established eight years ago to procure sites for new free schools. But falling rolls have diminished demand.
Analysis of government data suggests 36 have opened in the past 12 months, fewer than at any other point in the past five years.
A LocatED spokesperson said the organisation’s work had “significantly changed” as “new challenges for the education estate have emerged”.
“As we have done previously, LocatED stands prepared to meet any additional property challenges that may arise for the DfE and the education sector.”
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