Wandsworth Council has reduced the number of affordable homes at the Battersea Power Station development. The number has been cut from 686 to 386 – a reduction of 40%.
It means just 9% of the homes built will be classed as affordable.
Properties prices at the site start at about £460,000 for a studio flat, rising to £1.9m for a three-bedroom flat. Nearly 90% of the 1,661 marketed homes have been sold already.
When finished the development will comprise more than 4,200 properties.
Most of the affordable homes being built will be available to rent at 40% of market rental values.
Khan said: “When Wandsworth Council waved through the developer’s request to slash affordable housing at Battersea Power Station, I made very clear their decision was letting Londoners down.”
City Hall said it had no power to prevent the cut in the number of affordable homes being built at the development as the change was made through a deed of variation, which allowed property developers SP Setia and Battersea Power Station Development Company to make changes to the development with approval from Wandsworth Council.
Following the decision on 22 June the developers released a statement which said: “Battersea Power Station is determined to deliver 15% affordable homes, equating to 636 homes, and the team is working very hard to make that happen.
“We understand that asking for flexibility on when the affordable homes are delivered across this 15-year project is not straightforward, but our priority is to make good on the trust people have placed in us by starting on the first 386 affordable homes this year, which is three years earlier than the requirement in the original planning consent.”
The firm added it would be delivering the 15% affordable homes out of all those that “currently have detailed planning consent”, three years earlier than expected.
But Khan said the council appeared to “have had the wool pulled over their eyes”.
He referred to a viability study, which showed development of the site would yield a profit of £1.8bn to a company willing to take it on.
But Wandsworth Council disputed the figures, claiming the viability study was carried out in 2008 and was out of date.
Since then the upper end of the London property market had stalled and sterling had fallen by 20% in the wake of the Brexit vote, adding to construction costs and making it highly unlikely that SP Setia could achieve profits that high, the council said.
Yet average house prices in London rose nearly 40% between April 2008 and April 2017, according to official data, from £294,346 to £482 779.
City Hall said it asked Wandsworth Council for the viability information when it first learned about the developer’s request to cut affordable housing at the site.
Khan said: “The council failed to provide us with this information before deciding to send the application to planning committee for decision.
“I urgently wrote to the committee urging them to defer the decision until my recently-appointed expert viability team had challenged the numbers, but my concerns fell on deaf ears and Wandsworth waved this shameful decision through.
“Londoners will therefore be rightly suspicious of the speed in which Wandsworth Council rushed through the decision.”