Ealing Council is considering closing its two wholly owned housing companies after independent reviews concluded they are no longer financially viable, leaving the local authority facing a projected £6.55m write-off.
Cabinet members will be asked on Wednesday (10 June) to approve the closure of Broadway Living and Broadway Living Registered Provider (BLRP), which were set up by Labour-run Ealing Council to help deliver affordable homes in the borough.
Reviews by housing consultancy Campbell Tickell and auditors Grant Thornton concluded the companies were no longer financially sustainable, with income insufficient to cover their debts and operating costs.
The council has injected almost £43m into the two companies through loans and equity funding. Valuations suggest around £36.35m could be recovered through the transfer of housing assets, leaving a projected £6.55m shortfall.
Earlier financial reviews found the companies were in a negative equity position of around £15m, with funding from the council significantly exceeding the value of their assets. However, updated valuations suggest the council could recover more of its investment through the transfer of housing assets, reducing the projected write-off to £6.55m.
Broadway Living was established in 2014 as the council looked for new ways to increase the supply of affordable housing. Rising construction costs, higher interest rates and the collapse of contractor Henry Construction in 2023 left the companies facing mounting financial pressures.
One independent review concluded that “doing nothing is not a realistic option” and found neither company could continue in its current form.
If cabinet councillors approve the plans, the companies’ homes would transfer to the council and tenants would remain in their properties. The report says there would be “no loss of affordable homes” and that tenants’ rights would be protected.
The proposals would see all housing development and management functions “brought back in-house to the council”.
The plans also cover four unfinished housing developments at Shackleton Road, Southall; Wood End, Northolt; Chesterton and Evesham, Greenford and Norwood Road. Southall. Those sites would transfer to the council, with their future expected to be considered in a separate report.
