Collboni's proposal dilutes the 30% impact on major renovations

BarcelonaModifying the 30% reserve for social housing is one of the main electoral promises made by Jaume Collboni in his race to become mayor of Barcelona in 2023. Now halfway through his term, the mayor wants to unblock that commitment quickly and has diluted the impact of the regulation. According to sources, the latest proposal that the municipal government has sent to the groups – and which could still be modified during the talks – substantially reduces the housing stock that could be affected by the measure, since the regulation will only affect large renovations of buildings over 1,500 m2.² –until now they were those of more than 600 m²– and not all of them.

In the presentation that has been made in recent weeks to some groups at the City Council and to which ARA has had access, the municipal government adds two more restrictions. Within buildings larger than 1,500 m² Only those large renovations that involve a change of use – from offices to housing, for example – of more than 600 m² will be required to reserve protected housing.² and those buildings with vertical ownership—with a single owner—that carry out horizontal divisions—that sell the apartments to more than one owner—unless they have been renovated in the last 10 years. This is, in fact, a route that some vertical properties have used until now to avoid the 30% obligation. To pretend that it wasn't a major renovation of the entire building but rather different owners renovating their apartment, they sold some of the apartments in the building.

All of this means that the impact of the 30% on major renovations is expected to be minimal. Only by increasing to 1,500 m² The minimum surface area of ​​buildings affected in the case of major renovations already substantially reduces the housing stock that could be forced to give up protected housing, which would fall from nearly 4,000 buildings to just 1,350. And of these, it remains to be seen how many meet the remaining requirements for the 30% reserve to be affected. City Council sources point to the need to reactivate building renovations in Barcelona, ​​​​which has a very aging housing stock.

Possible financial compensation

However, the obligation to reserve 30% of protected housing in new constructions of more than 600 m2 remains in place.², in those buildings where height extensions are made –remounts– greater than these 600 m², and in buildings that have been completely rebuilt, keeping only the façade standing. However, unlike what currently occurs, Collboni's proposal offers developers different alternatives so that protected apartments do not necessarily have to be built in the same block as the one they build or renovate.

In this regard, a modification to Article 73 of the Municipal Charter is planned to allow developers to build 30% of protected housing on another plot in the same neighborhood or in a neighboring neighborhood—even if it is in another district—, converting already built homes or buildings into housing, but nevertheless built, and not having to build protected apartments. They can simply make an exchange and pay financial compensation to the City Council, which the council would allocate to "expand the public affordable rental stock."

To pursue this last option, the City Council would have to put into play land that it currently has designated as free housing. To avoid having to build social housing, the developer could enter into an exchange with this City Council land. That is, a portion of the public land would become social housing by assuming that 30% to compensate for the private land becoming completely open market. In return, the developer would pay the City Council compensation equivalent to the difference in value between the open market and social housing, which the council plans to use to expand the public housing stock for affordable rentals.

The proposal is controversial because, if it so wishes, the City Council has the power to rezone the land it currently classifies as open market housing to create social housing. That is, it could allocate 100% of that land to social housing itself, and therefore, the 30% of social housing that private land should build would be built on other land.

Pending support from Junts

Since the beginning of his term, Collboni has defended the need to modify the 30% reserve for social housing, considering that so far "it hasn't worked." The forecast of increasing the affordable housing stock by approximately 334 new apartments each year, which was set when the reform was approved in 2018—with the votes of the Comuns (England's Commons), PSC (Socialist Workers' Party), Junts (Junts), and Esquerra (Ecuadorian Left)—has fallen far short of being achieved. In fact, the municipal government itself often points out that only 23 have been built so far.

The mayor's proposal, however, still requires the support of other groups to move forward. The PSC's priority in recent weeks has been to reach an agreement with Junts (Junts), with which the Socialists would have enough to approve the reform. However, the agreement still has some loose ends to settle, such as taxation—the council members are demanding a 4% reduction in property tax—creating new aid, and demanding that Sareb transfer the 823 real estate assets it owns in the city.

Warning about the impact on tenants

Although the Socialists have publicly insisted on also requesting the support of Esquerra (Republican Left), the Republicans have not held talks with the municipal government for weeks and are unclear about the latest proposal. Furthermore, they have distanced themselves in recent days from any housing pact that includes Junts (Junts). What is also ruled out is the support of Barcelona en Comú (Barcelona en Comú), which warns that the exemptions for major renovations in vertically owned properties leave "all tenant blocks unprotected" from vulture fund speculation.

The municipal government's intention was to approve the 30% reform at Thursday's meeting of the government commission in order to bring it to next week's urban planning commission, but in the end, this will not be possible. The possibility of postponing it for later and convening an extraordinary urban planning commission this month or—more likely—waiting for the urban planning commission in July is on the table.