LISTEN What once might have been a nice-to-have in terms of a real estate project’s environmental impact will soon be a must-have. From November, any commercial development will be subject to a planning condition requiring developers to show how they can increase on-site biodiversity by at least 10%. It marks the first time such a requirement will be statutory rather than voluntary.
At UKREiiF, EG sat down with Alexa Culver, general counsel at Environment Bank, and Ben Stansfield, partner at Gowling WLG, to discuss the new biodiversity net gain regulation, the challenges developers will face in factoring the new requirements into their planning proposals, and how an initiative from Environment Bank could give developers – and landowners – a new opportunity.
There has been anxiety for many companies given the slowly emerging clarity over what is likely to be required, says Culver.
“It was palpable panic a couple of months ago: where’s the regulation? What’s really going to happen? How do we prepare for it?” she says. “But it’s making way for more of what I’m calling a kind of Dunkirk spirit now. We’re all just thinking: right, we’re going to work this out. Yes, the regs are a bit later than we would want them to be, but let’s crack on and find a way through. And Natural England themselves have said, ‘look, just triage, triage, triage’. Not every planning application is going to need absolutely the same forensic focus on biodiversity. Let’s just take a proportionate approach and hold all of our hands together through this.”
The bigger the better
There will be a bedding-down process, notes Stansfield. “The biggest concern is that it’s a new rule, which planning officers, consultants and developers are all getting the heads around,” he says. “That uncertainty is a big issue. The other issues are where the biodiversity works are going to be provided. Is it going to be insisted upon by officers that it’s delivered on site? Or could an off-site solution which may produce far better biodiversity results be acceptable?
“Developers putting their planning applications in are trying to work out how do we provide enough detail to give officers comfort but give us the flexibility – because an application gets submitted many months and years before implementation of the scheme – as to what the delivery solution will be?”
Environment Bank has been building a national network of habitat banks that will give developers an off-site opportunity if their scheme doesn’t lend itself easily to biodiversity improvements. “The gains are already being delivered for nature now, so that developers large and small can tap into those and if they need half a unit of medium-distinctiveness scrubland, for example, it’s there for them to take while they’re contributing to bigger, better, more joined-up schemes,” Culver says.
A habitat bank could be as large as 150 acres – “the bigger the better” Culver adds – and will often provide a new income stream for a landowner who may have no other plans for its use.
“The miracle of getting a habitat bank open is finding an area of land, large, in a strategic location for nature with a landowner who understands what we’re looking to achieve and who can be part of that solution,” she adds. “Typically, what we’re looking for is depleted land, perhaps over-farmed land, not necessarily very productive.”
Environment Bank then pays rent to the landowner and management payments to the land manager, who puts together a habitat management plan and prepares the ground ahead of developing a site that will be operational for the next three decades.
“The developer has delivered what gains for nature they can onsite, they’ve avoided losses as much as they can, and they come to us for the off-site solution to complement what they’re already doing,” Culver says.
Next gen
Is real estate ready in terms of talent? Culver isn’t so sure. But with a glass-half-full attitude, she says the changes coming in November could encourage a new cohort to enter real estate and make their mark on the built environment.
“There’s a sector-wide nervousness about the lack of ecologists,” she says. “This all stems from a decent and robust understanding of ecology. It’s a complex, important topic. And understanding the Defra metric [by which biodiversity will be judged] in itself is an art form. So I think there’s a nervousness that we don’t actually have the numbers of ecologists to service all the levels of help that are needed across the sector.
“But what we’re hoping is that the passing of the Environment Act coming into force in November will start to show the true value, the economic visibility of the nature that’s being lost to developments – and bring forward swathes of qualified ecologists to support the growing sector.”
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