Major Wolverhampton housing scheme hits setback amid factory closure plan

Wolverhampton Council last year announced Legal & General (L&G) as its preferred developer for its Canalside South scheme of around 400 modular homes.

But council chiefs say they have re-entered talks with L&G after the firm announced proposals to close down its factory in North Yorkshire, where the homes were set to be be constructed.

The finance-to-property group said it plans to cease production at the site in Selby, near Leeds, due to years of weak demand.

A Wolverhampton Council spokesperson said: "We remain in dialogue with Legal & General together with our strategic partners and advisors to see what it means for the Wolverhampton Canalside South scheme and what the next steps are."

A spokesperson for L&G told the Star that proposals to cease modular production in the factory did not impact obligations to "existing customers and partners".

"We will retain a select workforce to ensure high quality delivery and aftercare services across our existing schemes," the spokesperson added.

"We have and are engaging with our partners on each individual scheme."

The spokesperson confirmed that work has not started on the Wolverhampton homes.

Former Black Country Chamber of Commerce chairman, Ninder Johal, urged L&G to provide clarity on the development.

He said: "Housing remains a central component for growth in Wolverhampton and the Black Country, and this scheme is a crucial part of that.

"L&G does not have a monopoly on this type of work, and if they are unable to get the job completed then I'm sure there will be other businesses willing to jump in.

"Hopefully this is an issue that can be quickly overcome."

L&G blamed "long planning delays" and the impact of the Covid pandemic for weakness in the firm’s pipeline of orders for new homes, adding that the group had not been able to "sustain the significant running costs of the large factory in Selby" as a result.

Bill Hughes, chairman of Legal & General Modular Homes’ board, said: "Legal & General is proud of what we have achieved in bringing forward a new approach to construction through our factory.

“However, without the necessary scale of pipeline it is not sustainable to continue producing more modules.

“We are therefore reluctantly proposing to reduce business activity and cease production of new modules at the factory.

“Regrettably, this includes commencing consultation with all employees around the proposal to make the majority of modular homes roles redundant.

“We recognise this will be a challenging and uncertain period for our staff and we will be actively exploring redeployment opportunities and supporting them during this difficult time.”

The sprawling Canalside South scheme was announced last year and will take over a 17.54 acre plot just outside the city centre. It is made up of the Canal & River Trust-owned former Crane Foundry site, Wolverhampton Council’s former British Steel site and land off Qualcast Road.

Wolverhampton Council leader Ian Brookfield said at the time it was one of the biggest city centre brownfield living projects in the West Midlands and would set a "new standard" for sustainable homes.