Tenants voted last week against the flagship Project Vauxhall scheme, headed by a St George/Wimpey joint venture. A source close to the scheme said the housebuilders were 鈥渧ery disappointed鈥�.
He said: 鈥淵ou have to ask, if St George can鈥檛 do a scheme like this, then who can? Now 拢88m worth of regeneration has been lost.鈥�
Although the scheme cannot continue in its present form, it is thought that St George and Wimpey want to continue working on it.
The source said: 鈥淭here is a good synergy between the firms. They will go back to the drawing board, provided Lambeth [council] is up for it.鈥�
Tony Pidgley, managing director of St George鈥檚 parent company, Berkeley, is believed to want the joint venture to try again.
Work leading up to the vote is already thought to have cost the firms several million pounds over the past two years.
A spokeswoman for Lambeth council said no decisions had yet been made on new plans for the estates.
She said: 鈥淲e will have to re-examine the whole project and see what lessons can be learned.鈥�
Further consultation with London mayor Ken Livingstone, who criticised the scheme for reducing the estate鈥檚 social housing provision, is also thought to be necessary in any revamp of the scheme.
The source said of the mayor鈥檚 intervention: 鈥淭his makes the developer look like Attila the Hun, with the mayor saving the people from being raped and plundered.鈥�
A spokeswoman for the mayor said he had not committed himself to being for or against the scheme.
Under the original proposal, more than 2000 private homes and 600 low-cost dwellings would have been built on the Ethelred Estate, along with a new secondary school, park and supermarket. The neighbouring China Walk estate would have received 拢16m for repairs.
The source said: 鈥淭he private homes and supermarket would have largely paid for the development, and the venture wasn鈥檛 going to make a lot of money out of it.
鈥淲e explained to the Project Vauxhall board at the beginning that building houses with gardens instead of flats would reduce the amount of social units, but they insisted.鈥�
Alan Cherry, chairman of housebuilder Countryside, which is working on the 拢1bn regeneration of Elephant & Castle, also in south London, said he was disappointed at the vote, but he questioned whether the tenants had understood the value of the scheme.
He said: 鈥淚f people don鈥檛 want changes, it shouldn鈥檛 be enforced. But it has to be fully explained what all the benefits can be. With all due respect, you have to question if they were fully explained in this case.鈥�
