Berkeley has launched a bid to push through its 850-home development at a “run down” Peckham shopping centre, slamming the council for its “spectacular failure” to meet housing targets.

The FTSE 250 housebuilder has applied for a judicial review of the planning inspectorate’s decision to block the plans, which it says wrongly put heritage concerns above the “severe housing crisis facing London”.

The decision to block the development in May was met with outrage by housebuilders and economists, though it was celebrated as a “great day for Peckham” by local councillors.

The development would create 850 private and affordable homes on the site of Peckham’s Aylesham Centre, a 1980s-style shopping arcade, and revamp the Morrisons supermarket that sits on the plot.

Decision ‘clearly flawed’

Berkeley will claim that the planning inspector failed to consider whether the “myriad” of other proposals he referred to during his decision were actually deliverable.

The housebuilder will also tell the judicial review that the inspectorate did not adhere to the sections of the national planning framework which require a bias towards sustainable developments.

Rob Perrins, Berkeley’s executive chair, said: “This Planning Inspector’s decision is clearly flawed and will undermine the Government’s pro-homebuilding agenda unless it is swiftly quashed.

“It cannot be right that heritage concerns trump all other policies, including the delivery of new homes, jobs and growth. This decision has already shaken investor confidence, and it is a great shame that we now have to go through the courts to have it overturned.”

The housebuilder claims that the development would create nearly 1,000 jobs, 60 apprenticeships, £15m of investment in local infrastructure and nearly £13m of annual local spending by the residents of the new homes.

Berkeley noted that the site of the shopping centre, which it said is “run down,” has been allocated for housing development for more than a decade, since 2014.

‘Sacrifice of much needed homes’

Supermarket giant Morrisons, whose store on the site would be redeveloped during the project, has backed the housebuilder’s challenge.

A spokesperson for the grocer said: “Peckham is now left with an end of life shopping centre and a supermarket which cannot be redeveloped for the benefit of customers and colleagues. 

“The cost of the recent decision is not just the loss of a new town centre for Peckham, but the sacrifice of much needed homes including a number of affordable homes for local families.”

The planning inspector said in May he was “cognisant” of the need for new affordable homes in the capital and said the development would offer a “considerable benefit,” but blocked the plan on heritage grounds.

Cllr Sarah King, the leader of Southwark Council, said following the failed appeal: “This is a great day for Peckham and we welcome the planning inspector’s decision to dismiss Berkeley Homes’s appeal for the Aylesham Centre.”

When the proposal was struck down, Berkeley claimed it can “no longer invest” in London. 

On Thursday, the housebuilder warned of a critical slowdown in housebuilding in the capital and issued a swathe of demands for Prime Minister to-be Andy Burnham to kickstart construction.