LISTEN Jackie Sadek is frustrated. Frustrated about a lack of progress in the evolution of partnerships between the public sector and private sector real estate companies.
Frustrated that despite the growing urgency of the climate crisis, the one approach that will prove crucial in tackling it is still misunderstood.
“We’re facing this massive existential threat,” says the Urban Strategy director. “The only way we can tackle it at all is by working together and by pulling together. I get completely exasperated, because I’ve been working in partnerships for 40 years and we’ve still not got any better at it. We’re going to have to shape up, frankly, if we’re going to tackle this existential threat.”
Sadek was one of a panel of professionals brought together by EG and Clyde & Co at a breakfast briefing at the recent UKREiiF conference to discuss public and private partnerships as they relate to the journey to net zero. The discussion had hope at its core, but no one denied how stark the challenges are.
“I’m the biggest advocate of partnership working, but partners always fight like rats in a sack, unless there’s iron discipline exerted and you basically say to people, ‘we’ve got a shared endeavour and you’re going to have to put your own personal grievances to one side while we reach this goal’,” Sadek says.
“We’re going to have to take a whole fresh look at partnership working, because unless we do – and I’m sorry, I’m going to use a technical term now – I think we’re buggered.”
Skin in the game
Attempting to drive change from the government’s perspective is the Office for Investment, which targets “transformational, strategic” overseas investors to bring to the UK, in the words of deputy director Ramona Jones.
“I wholeheartedly agree with Jackie,” Jones says of the importance of changing the perception of public-private partnerships. “International investors are very keen to adopt a partnership perspective and lens. So I have the dual role of corralling my regional stakeholders and my private sector partners to demonstrate that we are willing to work as UK PLC to international investors.
“The large pension funds, sovereign wealth funds, equity funds – all they want to see is that, as a central government, as local government, as industry partners, we have skin in the game and we want to work together.”
The City of London Corporation could be a role model for other local authorities. As Shravan Joshi, chair of the corporation’s planning and transportation committee, puts it, the organisation is “a corporation that has local authority function”. “We’ve been doing partnerships for 950 years, since William the First first stepped foot into London,” he says.
“We are entrusted, in probably a more autonomous way than most local authorities, with the Square Mile,” Joshi says. “Looking at international investment, I think 96% of money flowing into property investment in the Square Mile is from international investors. It’s not domestic. There’s no government handout, there’s no cap in hand. It’s private investment going into fully sustainable net-zero buildings. That’s driven by the money, but the money is driven by looking at [what] the tenants want to occupy.”
He points to Clifford Chance moving from Canary Wharf to GPE’s 2 Aldermanbury Square.
“One of the main reasons they wanted to move across was so they could have a fully electrified building that had a net-zero operational footprint on site in the Square Mile,” Joshi says.
“That was one of the big drivers for them to come across because they want to get their lawyers back to work. They want people in the office, they want clients to visit them in the office and they want their office to reflect their values as an organisation. They can’t be sat in a in a polluting environment. And they’re willing to pay peak rent to achieve that.”
Battling with blockers
The sector is now in uncharted territory as it handles the climate emergency, EG’s guests agreed.
“Fundamentally, we’ve not done this before,” says Clyde & Co partner Andrew Wallis. “We are in another revolution. There was the industrial revolution, we’re now in an environmental revolution, and there’s no right or wrong answer. We don’t have a ‘one size fits all’. We are very much learning as we go along and we are refining and using technology and innovation to get better. But time is of the essence. We have a deadline to meet that’s fast approaching and we have to find new ways of getting there as quickly as we possibly can now.”
At Yorkshire-based developer Citu, managing director Jonathan Wilson pulls no punches.
“We stand today as a society and as a planet at a point of genuine emergency,” he says. “We’re proud as a business to be a solution to that in the cities were we work. But the stark reality is that we talk about a [net-zero] target of 2050. We need to acknowledge that if we develop and change like we have in the last five years, and times that for every year up to 2050, we are buggered, and we’re buggered way before 2050.”
Wilson says he and colleagues have had to “rip the model apart” in terms of how the company works with other stakeholders to craft and create sustainable schemes.
“Systematically, we’ve had to start again,” he says. “We’ve had to start again with our purpose, we’ve had to start again with how we deliver the places we deliver, and where we deliver the places we deliver. And the reality is, in the last 10 years of our growth, we’ve had blockers every single step of the way, whether that’s finance, whether that’s local. Every single step, we’ve had to fight.
“We’ve had to fight to deliver zero-carbon places that don’t have cars as a necessity. We’ve had to fight for changing the way that people use the amenity space outside their front door, fight for removing fences. We all need to take a step back and realise this is an emergency. The crazy thing is that when Covid hit, we responded like it was an emergency.
“We actually did innovate. We did break down silos and we got ourselves together. We united, we behaved ourselves. And we went through dramatic change in a really short amount of time.”
If the industry did it before, it can do it again. The stakes have never been higher.
The panel
- Ramona Jones, deputy director, Office for Investment
- Shravan Joshi, chairman of planning & transportation, City of London Corporation
- Jackie Sadek, director, Urban Strategy
- Andrew Wallis, partner, Clyde & Co
- Jonathan Wilson, managing director, Citu
- Chair: Tim Burke, deputy editor, EG
To send feedback, e-mail tim.burke@eg.co.uk or tweet @_tim_burke or @EGPropertyNews
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