Plans to convert part of a Newton Abbot town centre building into apartments for social rent have been dropped.

The scheme for Sherborne House, which is part of the wider masterplan vision for the regeneration of Newton Abbot town centre, would have seen the third floor of the building converted to residential accommodation, while retaining the lower floors for office and healthcare use.

Ten apartments for Social Rent were proposed, with Teignbridge District Council submitting plans for the scheme for a range of one and two bedroomed accommodation last Autumn for the site.

But Cllr Alan Connett, leader of the council, told Tuesday’s overview and scrutiny committee meeting that those plans were no longer possible following further investigation into the building.

Cllr Connett said: “We bought the building to re-let it as offices and have residential on the top floor, but further investigation has shown that it won’t be possible and we cannot have residential on the top floor, so we won’t be bringing that forward, and we will be looking for further tenants for the building.”

The Sherborne House scheme was due to be part of the Teignbridge 100 – plans for the council to build 100 additional affordable homes across the district, to boost the local economy and secure low cost homes for people unable to get on the housing ladder – with plans for two houses at Drake Road and five flats at East Street having already been approved and work under way.

But the meeting heard that the council’s target for net new homes was recorded as a ‘concern’, with only 426 delivered against a target of 753.

The report said: “This is low due to lack of confidence in the market, mortgage funding is harder to acquire and so far a wet winter, but even before the impact of Covid 19 was felt, the 760 dwelling target was not being met. The target had increased in line with the Government’s standard method for calculating housing need once the current Local Plan turned five years old.

“Before then, the Local Plan target had been 620 homes per year and average completions had been more than 640 dwelling per year.”

Cllr Martin Wrigley, executive member for housing, said: “It would be unfair to be penalised by the government for a government imposed shutdown. We are required to deliver the circumstances to provide 753 homes a year but if the developers choose not to deliver any, there is nothing we can do about it.

“If they don’t put a shovel in the ground within three years then we can take the planning permission away, but there are over one million homes with permission they haven’t built nationwide and they don’t do anything until the market is ready, so we are punished for a situation that we cannot control.”

Teignbridge residents are currently being urged to have their say to help the council find sites for thousands of new homes across the district.

There have been more than 100 sites which have been identified as places where future housing provision could be provided as part of the Teignbridge Local Plan that will run until 2040.

But answering questions from Cllr Chris Clarance as to why the Local Plan options consultation includes a lot of ‘greenfield sites’ given that the NA3 development for Wolborough has ‘gone down like a lead balloon’, and why there isn’t more of a focus on ‘brownfield sites’, Cllr Connett said that there wasn’t enough brownfield sites to meet the required targets.

He added: “I never liked the Local Plan. We have it, and I didn’t support it, but we have to work in a hierarchy and the government has ordered us to take 750 houses a year, and I think they are wrong.

“There are not enough brownfield sites in Teignbridge to meet the government demand and they cost more to develop. I am concerned about the insatiable demand from developers for more homes, but an up to date Local Plan ensures development happens in the way we want it to happen and not in a sporadic way.”

The consultation on Part 2 of the Draft Plan, focuses solely on where development could take place and includes site options for housing development, employment land, secondary schools and considers evidence relating to renewable energy provision.

Taking account of housing provision already allocated in the current Local Plan, new sites need to be identified in the updated Plan for an additional 7,272 homes.

The Heart of Teignbridge area around Newton Abbot has provisionally been allocated for 2,920 homes, with the edge of Exeter for a further 1,800 homes, around 1,000 homes in Dawlish, 100 homes in Teignmouth, 250 homes in Bovey Tracey, 250 homes in Ashburton, and 960 homes in the villages. Chudleigh, Bickington, Ide and Shaldon however will not see any sites allocated as nowhere suitable came forward during the call for sites.