Council appoint consultant to market Ship Street site, to find suitable development partner

A flagship plan to transform Folkestone’s long-derelict Ship Street gasworks into new housing is under intense scrutiny amid mounting costs and protracted delays. An investigation reveals a pattern of optimistic announcements and expensive consultancies contrasted by slow progress on the ground. Projections even suggest taxpayers may see no financial return on the project for 40 to 60 years. This article examines the Folkestone & Hythe District Council’s handling of the Ship Street regeneration, charting a timeline of key decisions, contract spending, and the challenges that have left the former industrial site still empty.

Timeline of Key Events

1956–2001: The gasworks on Ship Street ceased operation in 1956, and structures were gradually demolished (final gasholders removed in 2001)​. The 1.5-hectare plot in East Folkestone has remained derelict for decades, becoming a local eyesore in the heart of a residential area.

2009–2011: Partial remediation of the contaminated brownfield site was carried out by previous owners. By 2011, major soil cleanup was reported complete​. However, challenging topography and residual contamination continued to deter private developers

2015: Seeing no market interest, the council added Ship Street to its housing development list to attract investment​ – but still no takers came forward.

2017: Folkestone & Hythe District Council (then Shepway District Council) made its first bid to acquire the ex-gasworks. A plan for ~85 homes on the site was proposed​. September 2017 saw a council report candidly admit the “proposal to purchase the land at Ship Street is not one that will generate a substantial commercial return … and there is a risk that there could be a degree of loss”​. The council nonetheless pursued ownership as the only way to spur development of the long-blighted plot.

Early 2018: The council applied for an additional £2.5 million in government brownfield remediation funds to help with cleanup, but this bid failed​. The funding setback meant the council had to shoulder costs itself if it wanted to proceed.

October 2019: A renewed recommendation to buy Ship Street went to the Cabinet​. Council leaders even announced the site had been “purchased” in 2019, and a report noted the council could choose to “bank” the land until market conditions improved​. Yet Land Registry records later showed the property was still owned by National Grid into 2020​. The title deed was suspended in June 2020, indicating protracted negotiations​.

April 13, 2021: After nearly two years of legal wrangling, Folkestone & Hythe District Council finally completed the purchase of the Ship Street site from National Grid for £400,000​. The council’s press release trumpeted a “bold purchase… long in the making” to unlock a strategic brownfield site between Folkestone Central station and the town centre. The council immediately outlined ambitions for 100+ mixed-tenure homes, including affordable housing, plus small commercial spaces and creative public areas on the plot​. Working with the local arts charity Creative Folkestone, officials vowed to deliver an exemplar redevelopment blending sustainable design and public art. “We are excited to transform this unsightly plot into a truly exemplar development,” a council spokesperson said at the time​. Creative Folkestone CEO Alastair Upton hailed the opportunity to create “a flagship model of urban redevelopment that benefits the local community for many years to come”.

March 2022: With the site secured, the council held public engagement events to gather resident input on the proposed scheme​. Initial concept designs were drawn up. A Fletcher Priest Architects study in 2021 had already identified design principles, such as creating a green pedestrian link across the site between the station and town centre.

Summer 2022: Further ground investigations were commissioned to assess remaining contamination and stability on the former gasworks. Environmental consultants RSK Environment Ltd were hired for a detailed site survey (~£65.5k), the results of which would shape the remediation strategy. Developers’ reluctance to touch Ship Street – owing to costly cleanup and “negative value” land – was a recurring theme​. Indeed, by mid-2022 council officers reported that no private developer would partner on the project unless the council absorbed the remediation risks and increased the number of market-rate homes​.

September 2022: A pivotal cabinet report (C/22/38) laid bare the viability challenges. To entice developer interest, the council expanded the scheme to 150–175 homes (up from the ~100 in earlier plans)​. Even with more units, financial models showed at best a break-even outcome – and only if millions in remediation grants and housing funds were secured​. The payback period on the council’s investment would be 40 to 60 years, the report warned​. In other words, the council might not see a positive return until the 2060s. “Whatever [option] Cabinet choose… we’ll see no return on this site for between 40–60 years,” the independent local Shepway Vox TEAM news site concluded of the council’s own projections​.

December 2022: Undeterred, the council moved forward with design and planning. It awarded a major contract for “Ship Street: Technical and Design Consultancy Services” to Ove Arup & Partners Ltd (Arup) on 9 December 2022​​. The contract, valued at £479,725, tasked Arup (working with Fletcher Priest as sub-consultants) to produce a masterplan and secure planning permission for the site​. This professional team of architects, engineers and sustainability experts began drawing up detailed proposals for an energy-efficient housing-led scheme of around 150 homes. The initial contract period ran through September 2023​, aligned with a target to submit a planning application by Winter 2023/24.

February–March 2023: Design concepts were unveiled to the public. A second community exhibition in March 2023 showcased evolving plans, including ideas for a new park on Foord Road and a pedestrian/cyclist “green link” connecting the railway station to the harbour via the site​. Feedback was sought as the masterplan took shape. Around this time, the council also paid specialist firm Frame Projects Ltd about £6,400 for managing public engagement for Ship Street, part of ensuring the consultation process met expectations.

October 2023: In a bright spot for the project, the council’s bid to the government’s Brownfield Land Release Fund was finally approved, years after the earlier funding disappointment. On 9 October the council announced a £2.5 million grant earmarked for clearing and remediating the Ship Street site​. “A project to transform a brownfield site in Folkestone… has received a £2.5m boost from central government,” the council’s news release declared​. Council Leader Cllr. Jim Martin hailed the award: “We are delighted the government has shown its support for our innovative project… despite its many challenges”​. The grant came with strings attached – essentially a deadline to start work. The council is required to have a development partner in place and remediation underway or risk having to return the £2.5m.

Late 2024: With design work still ongoing, the council approved an additional £125,000 for the Ship Street project’s budget (bringing the total budget to £770k so far, excluding the land purchase)​. The extra funds cover a contract extension for Arup’s team and hiring property consultants to finally market the scheme to developers​. By this point, five separate contracts related to Ship Street had been awarded, totaling £659,961 in value, covering everything from site surveys to masterplanning.

Early 2025: After nearly four years of ownership, the council still has no developer on board. Folkestone & Hythe officers have brought in Avison Young, a commercial real estate advisor, to actively market the site and secure a development partner. The strategy has shifted to seek only outline planning permission (for up to 150 units) – leaving detailed design to whoever takes on the project​. By reducing upfront design detail, the council aims to give a future builder more flexibility to ensure the scheme is economically viable​. According to an update presented to Councillors, a planning application is expected in spring 2025 and the hope is to appoint a development partner by summer 2025, with construction to follow once planning is approved​. As of today, however, the derelict plot remains untouched and its future remains uncertain.

Costs and Contracts Under Scrutiny

Since 2021, Folkestone & Hythe District Council has spent a significant sum on preparatory work for Ship Street – without a single brick yet laid. At least five contracts have been awarded related to the project, with a combined value of £659,961. These include the £479,725 deal with Arup for technical and design services​, by far the largest expenditure. Arup’s remit has been to develop the masterplan and lead the planning application process, in collaboration with Fletcher Priest Architects. Another contract (about £65,500) went to RSK Environment Ltd for conducting geo-environmental investigations on the former gasworks site​. This work confirmed what many suspected: while major decontamination was done in 2009, further remediation and groundwork are still needed before homes can be built.

Smaller specialist commissions have also added up. Frame Projects Ltd, a consultancy, was paid £6,400 to run public engagement events for Ship Street​ – an exercise meant to ensure community voices shaped the plans. The council has additionally earmarked funds for marketing and valuation advice as it tries to offload the site to a developer (about £40k set aside for these services)​. Legal and project management costs have accrued too, although the council has not itemized all such expenses publicly. Altogether, the outlay approaching £660k represents a substantial investment in paperwork, plans and consultants. Critics ask what the community has gotten for this money so far.

Council officials defend the spending as necessary to overcome the site’s challenges. They note that Homes England provided £75k in grants to offset some design and viability work​. Without public intervention, the contaminated lot would likely have “remained derelict for the foreseeable future unless the Council acts,” as one 2017 report put it​. Every step – environmental surveys, architectural drawings, viability studies, marketing – has been a prerequisite to make the project investor-ready. The true test, however, will be whether these sunk costs lead to tangible development. With fresh marketing efforts underway, the council hopes to finally attract a private developer to take the scheme forward. If no housebuilder comes forward even after all plans and permissions are in place, the money spent would be difficult to justify. Local watchdogs have warned that the council must avoid ending up, as one commenter quipped, “buying the site twice and developing it never.”

An Ambitious Vision Meets Reality

From the outset, the vision for Ship Street has been ambitious. The council sees the former gasworks as a key piece in the wider regeneration of Folkestone. The location is undeniably strategic – a large tract of land just a five-minute walk from Folkestone Central railway station and near the town centre​. Developing it could reconnect neighborhoods and create a new gateway between the station and the Creative Quarter/harbour area. Plans call for a mix of housing types (apartments, townhouses, and affordable units) to deliver over 100 new homes for local people​. The inclusion of small commercial spaces and community amenities on site aims to ensure it’s a lively, mixed-use neighborhood rather than a sterile housing estate​.

A partnership with Creative Folkestone is intended to imbue the project with artistic and cultural value. Ideas have included public art installations, a creative workspace or “maker” studios, and thoughtfully designed public realm. “The scheme will add to the distinctive cultural character of Folkestone,” the council promised, “with a strong focus on design, sustainability and art in public spaces”​. In concept, Ship Street could become an exemplar of brownfield urban renewal – transforming a wasteland into a vibrant community asset. Council leaders have consistently talked up these positive outcomes.

On paper, the benefits also extend to the environment and local economy. Redeveloping a brownfield site, rather than building on green fields, aligns with sustainable growth principles. Cleanup of lingering contaminants would improve environmental health​. New homes in a central location mean more residents within walking distance of shops and services, bolstering local businesses. The project would contribute to much-needed housing supply – including affordable housing – in a district that has struggled to meet building targets​. These broader goals explain why the council has remained committed despite setbacks. Indeed, in October 2023, Housing Minister Rachel Maclean praised efforts to turn “wasteland and unused brownfield land” into “beautiful and thriving communities” when announcing Ship Street’s £2.5m grant​. Few dispute that regenerating the derelict gasworks would be a win for Folkestone if it can be achieved.

However, turning that vision into reality has proven easier said than done. The very traits that make the site challenging – steep changes in elevation, old gas infrastructure underground, and costly remediation needs – also make it financially unattractive to private developers. Any developer taking on Ship Street must invest millions up front to make the land buildable, eating into profit margins. This is why the council’s own viability assessments predicted a loss or at best a negligible return on the project​. It’s also why the council has had to increase the density (now targeting ~150 homes) to even approach break-even. Local developers have long shunned the site; as the Shepway Vox Team noted, “Ship Street… is not a viable site, hence why no developer has ever chosen to purchase it and build it out”. By stepping in as the developer of last resort, the council effectively accepted that public benefit (new affordable homes, eliminating an eyesore) would come at the expense of commercial gain.

Hopes, Doubts, and the Road Ahead

Today, four years after the council’s “bold” purchase, the Ship Street project stands at a crossroads. The groundwork – literally and figuratively – has been laid: surveys done, designs drawn, community consulted. The council is poised to seek outline planning permission by spring 2025 for a scheme of up to 150 homes​. With planning in hand and £2.5m of government remediation money on the table, the package will be marketed to developers as a turn-key opportunity. Officers are working with Avison Young to market the site and secure a developer to bring the site forward for housing​, says a recent council report. The goal is to sign up a development partner by summer 2025​. If that succeeds, construction on Ship Street could finally begin in earnest after years of false starts.

Yet skepticism abounds. Councillors and residents are asking tough questions about the council’s handling of the project so far. Why did it take so long – and so much public money – to reach this point? Could the council have structured a deal differently, perhaps by sharing risk with a developer earlier or scaling back plans? There is also the lingering mystery of the “two purchases” – the impression that the council paid for the site twice. In 2019 the council announced it had bought Ship Street only for the deal to seemingly fall through, before buying it again in 2021​. The council never openly explained this, leaving some to wonder if an aborted 2019 transaction cost the taxpayer. (Land Registry records show the site remained under National Grid ownership throughout 2019, so it appears the 2019 “purchase” was premature​. The 2021 sale for £400k was the definitive transfer​.)

Most significantly, the project’s value for money is under the microscope. Sinking public funds into remediation and studies is one thing if it yields dozens of affordable homes and community spaces in a few years. It’s another if the site still sits empty years later or if eventual profits flow mostly to a private developer. Under the current approach, Folkestone & Hythe District Council will likely sell the land (after enhancing its value with planning permission and cleanup) to a developer who will then build and sell the homes. The council may recoup its site purchase cost and some expenses in the sale price – or it may not, depending on market conditions. Even optimistically, the council’s own financial models indicate it will not make a profit for decades​. Essentially, the council is investing in a social good (revitalizing a blighted area and providing housing) rather than a financial return.

In interviews, current council leaders have struck a cautious tone. They stress that doing nothing is not an option – leaving Ship Street derelict serves no one. They also point out successes to date: securing external funding, completing the technical groundwork, and formulating a viable plan. “This brownfield site [will be] brought back into use for the wider benefit of Folkestone,” the council promised​, framing the effort as a long-term regeneration strategy. The community, too, largely supports developing the site, though there are concerns about density and ensuring truly affordable homes.

What remains to be seen is whether the council’s late-stage course correction – simplifying the planning and partnering with professional marketers – will finally deliver results. If a reputable housebuilder or housing association signs on in 2025, the narrative could yet change from one of critique to one of hard-won success. The derelict gasworks could, after 70 years, be reborn as a thriving neighborhood with new homes, a park, and public art, just as envisioned. On the other hand, if no developer is willing to take the risk even with permissions and subsidies in place, the council may face a grim reckoning on Ship Street. The £2.5m remediation grant would likely be forfeited​, and the site’s future would revert to uncertainty.

For now, the Ship Street regeneration project stands as a case study in the challenges local authorities face in redeveloping problematic brownfield sites. It highlights the tension between ambition and practicality – a council determined to do the right thing for an area, yet constrained by financial reality and the limits of the market. As Folkestone & Hythe District Council prepares its next steps, residents will be watching closely. Will 2025 bring a turning point that justifies the years of investment, or will Ship Street remain a cautionary tale of good intentions bogged down in brick dust? Only time will tell, but the clock is ticking on this once-in-a-generation regeneration gamble.

The Shepway Vox Team

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