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29/09/2015

Skills shortages could hold back development of public land, experts warn

Words: Simon Wicks
Panellists at GVA public land seminar

A lack of property expertise in public sector bodies could hold back the release of public land for housing and infrastructure in London, experts have warned.

Knowing how to get the best value for land is critical to London benefiting from the sale or development of public sector land that is surplus to operational requirements, representatives of both the public and private sector said at Unlocking London’s Public Sector Land, a seminar hosted by planning consultancy Bilfinger GVA this morning (Tuesday).

This could be via direct sale, joint venture or developments orchestrated by public sector bodies that generate long-term income for the public purse.

“To date the approach has been sell. Sell, sell, sell, at whatever cost, with no consideration for the wider agenda,” said Richard Fagg, deputy managing director of Bouygues Development.

“There are 4,000-odd hectares of surplus public land in London. You imagine the income receipts public landholders could generate from building homes for rent on that. And what they could then do to implement their own strategic programmes.”

Government has placed an obligation on public sector bodies to identify land that is surplus to operational requirement and release it for development. But public sector representatives admitted that a skills shortage within their organisation was limiting their ability to develop their landholdings for maximum public good.

“In the past, the way Waltham Forest used its land disposals was sub-optimal,” conceded Ken Jones, the borough’s director of housing. “But there’s been a step change.

“How do we then use the land that the council owns to actually generate revenue for the future? The council has some land and it can access finance at a very attractive rate. But we don’t necessarily have those development skills.”

Maggie Robinson, head of property for the Royal Free London NHS Foundation Trust, called for greater “cross-fertilisation” of development skills between public bodies.

“What’s the NHS doing to unlock this opportunity? Well we probably could be doing a hell of a lot better. We are all being tasked with coming up with an NHS estate strategy. We need to build our talent resources and our skills base.”

Mapping public land in London

Kicking off discussion at the seminar, London’s deputy mayor for housing, Richard Blakeway, outlined the challenges facing planners in London in the immediate future.

Population was expected to reach 10 million within ten years, he said, which would “put pressure on place and people”. Housebuilding in the capital would have to double transport capacity have to increase by 50 per cent and energy generation go up by 20 per cent.

Despite the upwards trends, professionals in their thirties were leaving the city in considerable numbers because of a lack of affordable housing. “How do we address that with not just more homes but homes that are in the best sense affordable?” he asked.

The answer would partly be in “optimising” publicly owned sites, which represented a “significant” amount of land in London. With support from boroughs, the London Land Commission was mapping publicly owned land inside the capital’s boundaries, with a view to publishing this data by the end of the year.

But this information alone wouldn’t be enough to plan the kind of integrated developments that London needed,, Blakeway stressed. “Where is the marriage value between these sites? Where do they fit in with identified regeneration areas or new infrastructure?”

And, having identified clusters of sites with potential, “how do we bring these sites forward? Barratt London's Catford Green

“There’s a real challenge about the culture within the public sector and attitudes towards land. Most public bodies own land for operational reasons, and the skills they have will be more directed to facilities management than development control.”

The answer could well lie in public-private partnerships. But local authories would have to take the lead in land assembly – and be prepared to use CPO powers to secure regeneration in the areas where it was needed.

“We [the GLA] are using our CPO (compulsory purchase order) powers in a couple of places. But we need to look at how CPO works because it appears to be a very lengthy process that is chronically under-resourced.”


Key points:

- More commercial property skills are required in public bodies

- There should be a greater emphasis on joint public-private sector partnerships when developing schemes

- Local authorities should take the lead in land assembly, procurement and masterplanning

- Clusters of developable land should be considered in tandem so as to link development and make best use of infrastructure

- Development on public land should be constructed with an eye to long-term income through revenue receipts, rather then the short-term gain of capital receipts

- Streamlined planning and procurement processes would make it easier for land to be developed

- The public sector requires more resources to meet the demands being placed on it


A future in partnership

Blakeway’s themes of mapping publicly owned land, improving property skills and working with the private sector were picked up by other speakers and panellists at the event.

Sherin Aminossehe, chief operating officer of the government’s property unit, noted that around 2.1 per cent of land in England was owned by government, and the One Public Estate programme was seeking to map and rationalise these landholdings.

In London there were nearly 77, 000 civil servants. “Do they all need to be there? Probably not,” she said. The government’s strategy in the capital was to reduce its holdings from 143 buildings in 2010 to just 23 in 2022.

But a shortage of property skills could hamper the transition to a smaller, more commercially-focused estate. “We need better commercial management,” she admitted. “If you don’t have the skills, the right people, you cannot achieve what you need to achieve.”

In particular, public sector property teams would need to know how to deal with developers, conduct CPOs and read market trends. The government was currently working on a skills survey of employees.

Ken Jones of Waltham Forest, and other panellists, argued that joint ventures with the private sector could well lead to the most effective use of publicly owned land, as well as local authorities becoming developers in their own right. He was keen  to stress, however, that the needs of “existing communities” must be prioritised in any new development.

David Lunts, executive director of housing and land for the GLA, put the case for a more “interventionist” approach by the public sector, in which would play a larger role in land assembly, procurement and masterplanning. In particular, the emphasis was shifting, he said, from simply generating capital revenue from the sale of land to securing long-term revenue from new development.

“Obviously tax payers should get value for money and their money shouldn’t be wasted. Many argue that it’s the job of the public sector to organise it properly, and there’s an interesting discussion on the role of the public sector to be more interventionist,” he said, asking: “Should there be more emphasis on local planning authorities to come up plans that genuinely optimise the land that they own?”

This would include “complementary” uses, as well as fresh development. But he, too, wondered about how public bodies could develop and share the necessary skills.

For the private sector, GVA’s head of planning Gerry Hughes wondered about the ease of tendering for work through the current open government procurement process. Its complexity made it harder for small and medium-sized builders to play a part in redeveloping publicly-owned land – a particular problem when many larger builders passed up opportunities to develop smaller plots.

Hughes went on to say that the private sector wanted certainty and predictability above all else. “It likes the idea of the land commission, a joined up approach to bringing forward development land. They welcome the housing zones, because it gives a focus on delivery.

“But they would like to see a much more joined-up public sector so that when they pitch for those big opportunities they don’t have to talk to multiple organisations.”

There was, however, general agreement that the public sector was under-resourced. This meant it was likely to struggle to cope with the anticipated flow of land development opportunities that would come forward on publication of the London Land Commission data on surplus sites.

Catford Green image courtesy of Barratt London

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