Wheatley, the parent company of Scotland鈥檚 largest social landlord Glasgow Housing Association (GHA), will become a 50-50 joint owner and partner in City Building Glasgow, the council鈥檚 wholly-owned subsidiary.
The joint venture proposal is expected to be approved by Glasgow City Council鈥檚 executive committee on 3rd March. The Wheatley Group board has already signed it off.
The JV will deliver a 拢33m-a-year repairs service for Wheatley. It will also be responsible for GHA鈥檚 拢27m annual capital investment programme and the city council鈥檚 own repairs, worth 拢30m annually. This makes a total of 拢90m a year.
Glasgow City Council leader Frank McAveety said: 鈥淭his deal is a hugely important step that secures jobs, apprenticeships and training places, and future investment for the city. It will guarantee 30 years of work, worth 拢2.7bn, in challenging economic times and generate a further 拢225m for the city鈥檚 wider economy every year.
鈥淲heatley Group鈥檚 investment demonstrates how our partnership has worked over the past 13 years and the group鈥檚 complete confidence in City Building to continually deliver the quality and service they expect.鈥�
GHA took over Glasgow City Council鈥檚 entire housing stock 15 years ago. 聽City Building won what was then GHA鈥檚 five-year repairs contract, with an optional four-year extension, in 2009. The extension was exercised by Wheatley, GHA鈥檚 (new) parent organisation in 2013.
Last year, with two years of the contract to run, Wheatley鈥檚 strategic development committee commissioned an independent options appraisal. Consultant Campbell Tickell was appointed to lead the review.
In December 2015, the Wheatley board approved a recommendation from Campbell Tickell to take forward two options for further examination: taking the service in-house and forming a JV with City Building.
Campbell Tickell鈥檚 subsequent report concluded a JV offered Wheatley better value for money, avoiding start-up costs and reducing risk.
At its board meeting on Wednesday 24th February 2016 Wheatley accepted the Campbell Tickell recommendation, accepted by Wheatley鈥檚 strategic development committee, to 鈥減roceed to detailed due diligence and negotiation of the joint venture with GCC鈥�.
Wheatley Group chair Alastair MacNish said: 鈥淚n the months ahead, we will work through the detail of how the JV will operate, aiming to have everything in place to proceed in 2017.鈥�
Trades unions have lobbied city councillors to support the deal, to keep the service in the public sector. 鈥淚t is hoped such ventures are the future of social housing maintenance in this country,鈥� said Ucatt regional secretary Harry Frew.
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