by Graham Warren
Chartered surveyors often see planners as a necessary evil, whether or not the planner is in the public or private sector. Planning is just another hurdle of the development process which needs to be negotiated — preferably as quickly as possible, so saving time and money on the project. Conversely, many planners see surveyors as insensitive and unaware of the higher philosophical doctrines ostensibly encompassed by the planning profession.
Of course many chartered surveyors are also chartered town planners and it is the role of the commercially aware planner/surveyor which can be a crucial primemover in the development process. The key to development value is planning permission and anybody who identifies potential development land and obtains a planning permission on it for a commercially viable development commands a premium — both for the expertise in achieving the appropriate planning permission and for the development created.
Too often surveyors overlook the importance of planning in the development process. Closer liaison with planning consultants should not be feared; indeed there is everything to gain from a more collaborative and imaginative approach.
Times are hard in the development business because the building and disposal components of the process have virtually stopped. Bearing in mind the lead time involved in that process, it is a fatal mistake to assume that the creative end of the process should also stop. Today’s good planning consultants are first and foremost latterday alchemists. Whereas those who pursued the transmutation of base metals into gold failed, planning consultants often succeed: low-value land is turned into high-value land through the granting of planning permission.
In the next decade it will be land in the urban area that will be the principal element where alchemy can be applied to best effect. This is because the Government has made it quite clear, in various planning policy guidance notes and through decisions on appeals, that while some green field development can still be expected it is the urban areas which should be redeveloped to accommodate pressures rather than the countryside. All this not only reflects public opinion but is plain common sense.
The clever bit is making it happen, and this is where the proactive planner comes in. A common misconception is that local authority planners are employed to make things happen, including urban renewal, yet by and large this is not the case. Gone are the days when local authorities produced redevelopment proposals or improvement schemes and embarked on land assembly to implement them. Today’s culture requires either the private sector or, where they exist, development agencies like the Welsh Development Agency or the various development corporations to create such opportunities.
The extent of vacant land is considerable. In spite of a tendency for limited net reductions in recent years, there is still a large amount of vacant urban land — perhaps as much as 150,000 acres overall, about half of this in public ownership. This compares with an average of 14,000 acres per year of agricultural land being brought into urban use. Further measures to encourage the bringing of this vacant land into use are justified to ensure that the pressure to use undeveloped land is minimised, to improve the environment in urban areas and to secure the effective management of public assets. The DOE and its Welsh and Scottish equivalents are currently looking again at this whole issue.
After 45 years or so of comprehensive planning why do we still have tens of thousands of acres of derelict or underused land? Well, town planning is an ever-changing process. Every development plan has environmental improvement at the root of its policies, so any proposal to achieve this, in a development plan context, should meet with approval in principle if initially not in detail.
The balance between environmental improvement and commercial viability is where the commercially aware planner comes in. He has to broker the marriage between these two factors. The surveyor’s role is to fine tune the financial implications of the proposal and, more important, having initially advised on its commercial efficacy, to dispose of it.
The theory of urban renewal to the planning permission stage is simple to understand, but its application in practice is hampered by two things: first, the identification of commercially viable opportunities and, second, the subsequent management leading to the eventual realisation of the scheme.
A commercially aware planning consultant is in a position to carry out a strategic land search to identify redevelopment opportunities that are in broad accord with the development plan. A development plan is basically made up of a structure plan and a local plan (where adopted). Structure plans deal with the wider strategic issues, while local plans apply these issues on the ground. A unitary development plan is a single document that does both. It will be clear to all by now that it is necessary for the development industry, as well as landowners, to seek to influence these documents.
Provision is made for objections to the plan and where, as is sometimes the case, local plans propose that 50% of all housing on housing sites in the plan area will be for rent this is clearly wrong, because tenure is not a planning consideration. Similarly, where local plans have a blind adherence to the retention of employment land, even if vacant, to create local jobs, then clearly this is too pragmatic and should be removed from the plan.
Planning consultants are best used to cross the divide between their esoteric counterparts in the planning authority and the developer client. Failure to object to emerging plans at the right time causes inappropriate policies to slip through the net and become cast in stone. Once they have acquired this status they are a material consideration in the determination of planning applications and planning appeals, cloying treacle-like to the development project so that it may never get off the ground.
Much vacant and underused land not held by the public sector is held by companies who, although land is not their mainstream business, of necessity manage real estate. Day-to-day management means just that. Land is not seen as a financial resource and the picture is one of a reactive rather than proactive management. This is not new but was clearly iterated by the University of Reading in their 1989 study of the management of property assets.
The creation of an income or capital receipt from this latent resource could transform the company balance sheet. Assuming that chartered surveyors manage this land daily, even though the RICS has a Planning and Development Division, it would appear that a great many members in General Practice fail to use the resources which their fellow RICS members have to offer, let alone the more commercially minded members of the Royal Town Planning Institute.
So, what special skills does a planner deploy? A typical planning input to deal with vacant or underused land could be as follows: in a number of cases the planning consultant, having identified a development opportunity, is asked to advise on the professional team required to get the land to the stage where planning permission is granted. This could involve a surveyor/agent, geotechnical experts, highway engineer and urban designer. In cases of contaminated land it might involve the services of contamination specialists.
A superb example of collaboration between professions — initiated by planners, designed by engineers and landscape architects to be eventually marketed as a prime investment opportunity by chartered surveyors — is the Garden Festival, Wales, the UK’s largest leisure event of 1992 which is due to be opened on May 1.
Town planners regularly work with these associated professions and can advise on specific firms for particular jobs. Having got the initial proposals to the stage where, in the opinion of the team, they are commercially viable and environmentally acceptable, then comes the acid test of the latter when the planning application is formulated and the proposals placed with the local authority.
Pre-application discussions with the local planning authority are advised as a clear exposition of the proposals, because this helps the local authority to assess the application and the thinking behind it. The less helpful planning authorities will keep their cards close to their chests and may even hide behind the more recondite planning policies which they seek to apply.
A good consultant should be able to say whether this attitude and the objections emanating therefrom are well founded to the extent that they constitute sound and clear-cut reasons for refusal which will stand up should it come to an appeal. It is quite easy to come away despondent from a meeting with local planning officers who appear to be against the proposals for no good planning reason or because they are not up to the task of giving proper advice. Conversely, in those areas which are proactive to development opportunities in response to such factors as high unemployment and poor environmental quality, planning officers are likely to be keen to work with developers on joint ventures, especially where the land or a part of it is in public ownership.
A crucial component in any exercise of this nature is timing. Where there is a landowner/developer relationship it is necessary to understand the time-scale involved in reaching the permission stage. This will influence the contract between the parties and, in cases of joint venture, it will influence the method whereby the whole exercise is approached.
My firm has already established that the town planning process is subject to ever-shifting sands. During the currency of any planning application it may be necessary to make objections or to give support to a local plan, structure plan, or both. Failure to do this could seriously prejudice the project and the land as a development opportunity for some time to come.
How many surveyors and their clients have given up as wave after wave of apathy washes over development opportunities of this nature? Only by believing in a project will the benefits come to pass. Yes, the risks are high, but on this basis there is good reason to suggest that the rewards should be high. There are rumours afoot that government pump-priming of itself is not thought to be enough; greater intervention is now being mooted. Planners understand interventionists, talk their language and have sympathy with the philosophy of interventionism.
The message is clear. Only the best consultancies and agencies will survive the 1990s as the true effects of joining the European Exchange Rate Mechanism begin to bite. Stability can be achieved only at a price if the property boom and bust cycle is to disappear. Property professionals must get their collective act together to help bring about growth and prosperity, which in turn will bring much-needed improvements to our environment.
