Birmingham issues threat over troubled co-op scheme
Birmingham City Council has warned housing association GreenSquare Accord that future partnerships with the authority could be at risk unless it resolves a bitter dispute with a housing co-operative over an affordable housing scheme in Stirchley.
Earlier this year, GSA pulled out of an agreement to transfer a development on Pershore Road, Stirchley, to the residents co-operative it had originally teamed up with to develop the scheme.
GSA bought the site in 2022 with the intention of selling it to Stirchley Cooperative Development(SCD) at construction cost once the three-storey building had been completed, then estimated at around £10.4m.
But the association had to step in to complete the 39-home development after the scheme’s contractor, Tricas, went into liquidation in 2024, a move it said has led to cost overruns of around £2.5m.
SCD disputes that figure, and said it was not informed of any potential cost increases until January this year, adding that it believed it had entered a “turnkey” arrangement with the housing association containing pre-agreed prices.
In an escalation to the row, Birmingham City Council has now hit out at GSA’s decision to retain the development, and urged them to find a compromise with SCD.
‘Extremely disappointed’
In an open letter to GSA chief executive, Ruth Cooke, signed by city council leader Roger Hamer, deputy leader Julien Pritchard and four cabinet members, the city council has openly questioned whether it can continue working with GSA on future affordable housing projects unless the dispute is resolved.
“We understand the need of Greensquare Accord to recoup build costs and know that market changes are likely to have an impact. However, we are concerned that Greensquare Accord have moved away from the original intentions of the scheme despite prospective tenants and businesses spending hours of their own time, unpaid, to help design and develop a genuinely community led scheme,” it said.
“From a council perspective, the change in strategy from Greensquare Accord and the impact this has had on the local area has left the administration concerned about Greensquare Accord’s social purpose and its fractured relationships with the Stirchley community.
“This gives us serious reservations about future partnership working between the Council and Greensquare Accord. ”
‘Prudent financial decisions’
In response, GSA said it had a responsibility to its 54,000 customers. saying it had been clear with SCD that the final sale price would escalate in line with increasing costs of the scheme – a claim which is disputed by SCD, who say they would “never” have signed up to such an arrangement.
The provider manages around 2,000 homes across Birmingham, and has a nationwide portfolio of around 26,000 properties.
“We remain in dialogue with the co-operatively owned businesses and are drawing up leases for the three commercial units at the Pershore Road scheme,” said a spokesperson for GSA.
“Our intention has always been to recover the costs of the Pershore Road development through its sale and never to generate a profit.
“We [are] in discussions with Birmingham City Council regarding the letting of the 39 rented homes at the Pershore Road scheme. Subject to applicants passing our eligibility checks, and with the support of the local authority, we plan to offer accommodation to the households who had been promised a home by the Co-op.”
GSA claimed it was unable to progress tenancy applications with those households due to a reluctance from Stirchley Development Cooperative to share the details with them, a claim described as “factually incorrect” by SCD in a response to Place Midlands.
They said GSA’s comments on the financial shortfall of the scheme were inaccurate, and disputed how the total costs had been calculated.
“We had our businesses plans reviewed and supported by GSA, which produced agreed upon prices. Unlike GSA, we had no oversight of the potential for delays on this scale, and we were never informed of them until after the fact,” said a spokesperson.
“We would never have agreed to open-ended cost increases and delays from June 2024 onward. The scale of the price increase only became visible to us, as their partners, in January 2026,” they added.
