Purpose

On 5th March 2019, Council approved the latest
statutory Homelessness and Rough Sleeping Strategy. This strategy
identified that ‘there are limited temporary accommodation
options within East Herts for households who require accommodation
in an emergency. As a result households often need to be
accommodated within Bed and Breakfasts that are located outside of
the East Herts area, away from their existing networks. There is a
need for more suitable temporary accommodation options within East
Herts… (because) suitable local temporary accommodation can
minimise the negative effects of homelessness, before longer term
accommodation can be found’. Council approved the resulting
action, ‘to review the supply of suitable temporary
accommodation within East Herts to ensure sufficient
supply’.

Acting in pursuit of this action within the East Herts Homelessness
and Rough Sleeping Strategy, the Director for Communities is using
authority delegated in the council's Constitution in relation to
contracts and property to 'acquire, dispose of, let and licence'
property (paragraph 10.6.1.2) to 'procure and/or manage temporary
accommodation in pursuance of the council’s homelessness
duties and powers' (paragraph 10.16.2) and thus enter into a five
year contract to lease five self-contained flats in Hertford town
centre for use as high quality temporary accommodation located
within the district and reduce, or avoid increases in, bed and
breakfast use.

Homelessness is rising in the district with a corresponding
increase in the need to place homeless people temporarily in bed
and breakfast (B&B) accommodation. B&B accommodation is
obviously unsuitable for use as temporary accommodation for
anything other than the very shortest of periods, added to which a
room costs the council £370+ a week. Only around a third of
this covered by housing benefit, with the remainder having to be
funded from the council’s budget with Homelessness Prevention
Grant being used for any shortfall, subject to government
conditions on the grant’s use.

In 2023, the council was approached by the owner of five,
self-contained flats in Hertford town centre, MHN Holdings Limited,
that were about to be thoroughly refurbished. The owner offered to
lease the flats to the council at a competitive rent to reflect the
fact that the council would manage the properties, absorb any void
costs and return them in a decent condition.

The flats are now ready for letting and this decision records the
entering into a five year lease with the owner.

A summary of the five year modelled income and costs is given
below.

Five year modelled income
Rent net of voids £407,825
Service charge for utilities £16,313
Total annual income £424,139

Five year modelled costs
Lease and utilities £367,876
Management, maintenance and replacement of furniture
£56,419
Total annual costs £424,294

In addition, using these five flats in place of B&B
accommodation is likely to save the council c£155k over the
five years.

Decision

Enter into a five year contract with MHN
Holdings Limited for the lease of five flats at Market Place,
Hertford for use as temporary accommodation with the lease and
running costs being covered in full from rental and service charge
income.