Affordable housing in London was under the spotlight at MIPIM.
In the Housing Matters panel discussing City Hall’s role in delivering affordable housing, Tom Copley, the deputy mayor of housing and residential development at the Greater London Authority, spoke about the role of estate regeneration and the lack of a “global gold standard” in affordable housing provision.
He told delegates the GLA was looking to grow the number of partnerships it has and the amount of work it is doing in affordable housing.
He said: “Since the change of government, things have got better and you might expect me to say that, but now we have this political alignment in London between national government, regional government and the majority of London councils. And whoever you talk to, the vast majority of people in the sector want the same thing: they want to be driving forward housing development.
“I see City Hall and the GLA uniquely placed within England in order to bring all those voices together and actually drive forward housing regeneration. The GLA is the housing investment authority, it is the local planning authority, and the mayor is chair of Transport for London and we know how crucial great transport connections are to building, particularly building density. So that’s an extraordinary set of levers that we have when combined with the mayor’s convening power. I think that at the GLA we already do play a big role. We’re going to play an increasingly big role in the coming years.”
Battling NIMBYs with ballots
Copley was joined by Darragh Hurley, chief executive of Mount Anvil, a London-based developer that focuses on estate regeneration. Hurley said Mount Anvil has a pipeline of six estate regenerations across the capital that will provide up to 4,000 homes.
“It’s been a pretty challenging five years for central London development from a cost regulatory perspective. One of the key challenges for us when we’re looking to increase density significantly is building local support for those plans,” he said.
Hurley said the way Mount Anvil was overcoming the challenge of nimbys was with the idea of a ballot. He said: “When we work with a community and talk about regenerating their estate, the majority of the people who live on that estate in the affordable homes have to vote for regeneration. We were hesitant at the start but what that’s actually meant is that then, when people oppose the density, we have a very strong group of local people who want a better chance for them and their families. And that was helpful with local politicians as we look to increase the number of homes on that site. So I think that’s a way that London has come up with a solution that really helps.”
Copley added that the GLA had seen 36 positive ballots since the estate regeneration process was brought in. He added: “When you’re talking about estate regeneration that involves demolition, you’re talking about knocking down people’s homes – it’s an enormously emotive issue. So what Sadiq (Khan) has done as mayor is place residents at the heart of that and that gives residents a much stronger voice. It can even mean residents are much more involved in the actual co-design of schemes.
“It allows for social landlords and their partners to get involved and speak to residents throughout the process, and it is a process, the ballot is not the beginning and or the end of the process. It is a milestone within that process.”
Lack of “global gold standard”
Svitlana Gubriy, head of indirect real assets at Abrdn, joined Copley and Hurley at the panel. She said there was no gold standard in providing affordable housing and financing globally.
This leads to different countries and jurisdictions playing by different rules. She said for investors and developers to get involved in the affordable housing scenario “you need to have multiple things working together”.
“For example, we can talk about land, land availability, land price planning,” she said. “Finance availability of discounted financing schemes through government grants, all of that needs to be a part of the top-down government land proposition and that will allow institutional investors to be a more successful part of the solution in providing affordable housing.”
Hurley added: “From our perspective as a developer, an investor can easily get lost in the fog of policy. One of the best things about London at the moment is the clarity of political will cross-party to deliver affordable housing. We see it in the GLA, we see it national government, we see it in local government and at the borough level. And it just cuts through a lot of the nonsense.
“We might have had conversations five years ago where certain investors or for-profit types wouldn’t have been working in the affordable housing conversation. I hear much more about how one child in every classroom in London is in temporary accommodation. We have to solve this problem and I think that growing political consensus is good for Londoners, is good for development and it’s good for investors.”
Gubriy said when she assesses the success of affordable housing programmes across the globe she looks at “the objective that government or local government or municipality had in mind”, the measures put in place and whether the goal was achieved.
She said: “There are multiple areas to consider, including the financing element, tax, land planning. It’s a very difficult topic, especially in the UK, with planning and land availability. But when we have examples of local municipalities having an objective to effectively create a new area that will focus on affordable, inclusive communities. We have those examples in Vienna; we had those examples in Madrid, so government effectively fast-tracks planning, allows developers and investors to come in and quickly … to deliver affordable housing and social housing.”
She said even though the London land market was challenging, there are steps the government can take to increase affordable housing delivery in the capital.
Gubriy added: “If investors can access land at discounted rates, or get some activisation of land plots that are hidden somewhere in a small alley that nobody thinks about – such as in London, there have been some examples of doing interesting investments and development of NHS land – those examples are very important because, for institutional investors, they remove uncertainty and, at the end of the day, one thing investors don’t like is insurgency and changing rules.”
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