A property developer had its affordable housing contribution slashed from over £4m to less than £500K as Westminster Council waved through a hotel conversion project in Bayswater.

Leeds Property Ltd plans to convert the Holiday Villa Hotel on Leinster Gardens into 32 flats. Normally a development of this scale would need either 11 of the flats were “affordable” or a payment of £4.447m were made to Westminster Council’s affordable housing fund.

Instead, Westminster’s Planning Committee approved the developer’s application without any affordable flats at all. And the developer will pay just £554K to the council’s affordable housing fund, almost £4m less than council’s policy mandates.

Westminster planners accepted the developer’s argument that, since the initial application, the price of the hotel it was buying had gone up but the price of the flats it would be selling had gone down. The developer claimed that any higher contribution would force it into the red.

Councillor Geoff Barraclough, Labour planning spokesman said:

“The market moved against the developer but it is local people on the housing waiting list that will take the hit. This is yet another example of the welfare state subsidising private sector losses.”

Labour Councillor Maggie Carman who represents Bayswater Ward said:

“This development should be providing 11 flats for hard pressed local people. Instead, it’s going to become yet another development of luxury flats. Westminster planners need to stop being rolled over by developers and start standing up for our residents.”