Atelier Finance has published a manifesto for the government, with eight calls for action that it said would get SME developers building.
The firm has collaborated with private developers, planning consultants and valuation and legal experts in the real estate sector to tackle the biggest hurdles to delivering on the government’s target of building 1.5m homes in the next five years.
Speaking at a roundtable hosted by EG, Atelier chief executive Chris Gardner said: “The one stakeholder group that is completely unrepresented in every planning application and approval process is the would-be homeowner. The current system neglects the hopeful homeowners across our country.
“We need to see a transformation in the leadership and culture of the system so that we are once again encouraging development. Planning officers need to know that they are supported when they make unpopular decisions. If you’re going to build 1.5m houses you need to be bold, and the government needs to be driving that from the top.”
Cultural shifts
Atelier noted that private developers deliver 60% of new housing stock in the UK but are required to navigate various bureaucratic inefficiencies to get projects off the ground. The firm said that a one-size-fits-all approach to regulation and escalating costs leave a number of smaller schemes unfeasible. Interest rates on bridging loans now stand between 10% and 15% and, at the current rate, a year’s planning delay on a £10m site will cost developers more than £1m in interest.
The firm said an absence of consistent leadership, accountability and commerciality in planning departments is leading to uncertain planning conditions and a lack of proactive engagement with developers. Planning has become “politicised and polarised”, it added, with a number of sitting councillors elected on anti-development manifestos. The default position from some local authorities on new housing projects is now “no”, the team said.
“We need to see a substantial increase in planning capacity, coupled with a paradigm shift in our attitude to housebuilding,” added Sam Jones, a director at Stancliffe Homes, speaking at the roundtable. “There needs to be a greater desire from local authorities to build and a pro-development approach adopted at every level.”
Atelier’s requests include a “cultural shift” that leads to “a proactive, pro-investment and pro-development stance from local authorities”; better briefs from planning departments on what their local area needs in terms of housing and development; and development targets that would incentivise planning officials to approve projects.
“The risk of delays, planning rejections and low take-up have created a high-risk environment where it is difficult for developers to operate,” said Damian Keeling, residential valuation partner at Allsop. “If the government hopes to incentivise building it needs to de-risk development approvals and adopt policy that helps bolster demand.”
The firm also wants to see more transparency in CIL payments, with evidence of how the money has been spent; better promotion of local CIL-funded projects, which it said could “help repair the relationship between developers and local communities”, and streamlining of cost burdens by removing absolute section 106 payments in favour of the reintroduction of section 106BA and the “free go” for resubmitted applications.
“The lack of transparency from local authorities in the processing of CIL and section 106 agreements drives a wedge between developers and local communities,” said Peter Messenger, a senior development monitor at Atelier. “Smaller schemes should be allowed exemptions from such onerous and costly mechanisms.”
David Brown, a planning director at Newsteer, added: “I would like to see a reintroduction of fee exemptions granted for repeat planning applications, otherwise known as the ‘free go’. We would of course need caveats, such as demonstrating a clear direction of travel to address the apparent shortfalls, but for SMEs the costs of resubmitting an application, particularly when the reasons for refusal as spurious, are significant.”
Long-term mindset
Atelier wants pro-investment intermediaries to be established within local authorities to engage developers, drive investment and help get projects off the ground.
Its final request is around community engagement. To challenge anti-development and nimby rhetoric, the firm said, developers and local authorities should consult the community by presenting various potential development approaches. This would, it said, empower local communities with choice, while ensuring developments proceed. Atelier said there needs to be a shift away from binary “yes” or “no” responses to new projects.
“I would like to see proactive investment into developments that are centred on placemaking, not just maximising our housing units but instilling a long-term mindset for projects that takes the needs of the local area into account,” said David Conboy, a development consultancy director at Newsteer. “This will only happen with genuine leadership and greater collaboration between local authorities and developers.”
Image © Atelier
Send feedback to Akanksha Soni
Follow Estates Gazette
