The housing company owned by Shropshire Council has slashed the number of affordable homes on one of its developments by three quarters after hitting a series of costly setbacks.

Cornovii Developments Ltd said it had no choice but to cut the number of affordable properties at its Ellesmere Wharf site to “mitigate” some of the extra costs it has incurred in the construction process.

Under planning permission granted in 2021, the firm is currently building 23 houses and bungalows on land near the canal, and had promised two would be sold under shared ownership with another six let at affordable rent.

However the council’s housing supervisory board has now been told there will only be two affordable rented properties – meeting the minimum 10 per cent required by local planning policies – and no shared ownership homes.

A report to the board also said the company was now aiming to build 723 homes by 2030 of which 123, or 17 per cent, would be affordable. Cornovii’s business plan, agreed by the board earlier this year, stated it would aim for 19 per cent affordable.

Councillor Julian Dean asked Cornovii’s managing director Harpreet Rayet whether this was going to become a trend.

Councillor Dean said: “We have gone adrift from the 19 per cent affordable plan to 17 per cent.

“The big question is, is that a one-off of is that a direction of travel? Are we going to see further drift away from 19 per cent?”

Mr Rayet told the board that Cornovii was committed to exploring ways it could deliver more affordable homes, including potential to partner with Homes England.

He said: “As a company we are always looking at avenues, which we have discussed in the report, about how we can increase that level of affordable houses on offer across our sites, while also having to deal with the commercial reality of the development itself.

“From our perspective, if we can tap into the partnership with the local authority and other partners which will increase the level of affordable houses, we will do that.

“What has been really interesting for me is that Homes England are now looking at social rents again and that is a potential new avenue for us as well.

“We want to do more. I think it’s really important across the council to deliver more affordable homes.”

Mr Rayet said the Ellesmere scheme had run into numerous problems with on-site services and had one of its contractors go bust after beginning the work.

As a result, the development was delayed and the company had to push back the dates it hoped to be able to release the homes for sale.

Mr Rayet said: “There are still some outstanding service issues and some concerns around health and safety if somebody buys a property there.

“It’s got a single entrance in and out of the site, and the way the scheme is being developed currently is that some of the plots would potentially be affected by heavy machinery, making it unsafe for people to move into those properties.”

Mr Rayet said he was taking advice from external consultants on the issue, and that it was now hoped that the first homes would be available between November and January, with the site to be completed by May or June 2024.

Councillor Ruth Houghton asked whether the safety issues could have been anticipated at the planning stage.

Mr Rayet said: “If I’m being totally honest with you, yes it could have been identified as part of the initial development programme.”

However he added that most of the problems with services and land contamination – including the discovery of electricity pylons buried on the site – were not known about until work started. This meant the company had to adapt its programme and start building the homes in a different order than it would have preferred, he said.

The board also heard work was progressing well at the company’s Ifton Green site in St Martin’s after a series of setbacks, and contractors were now on-site on its next developments at the former Oakland Primary School site in Bayston Hill and on London Road in Shrewsbury.