Promoter frameworks set to speed release of public land for housing

With ambitious targets for public sector land release and communities secretary Sajid Javid warning housebuilders they need to speed up delivery or face intervention, the private sector is proposing a solution to the market’s failure to build enough homes. Land promoter frameworks are popping up around the country offering brokers to public sector bodies looking to de-risk brownfield sites and release them to housebuilders. After the land sales have completed, the promoter recovers the costs incurred and takes a percentage profit from the sale. For local authorities and public sector bodies, using the framework means they can bypass a lengthy and labour-intensive Official Journal of the European Union tender process. They do not have to risk any capital and they are likely to speed up housing delivery in line with government targets. Land Solve, a tie-up between property consultancy NPS Group and Barnsley Council, is a new framework that will be formally launched in March offering land broker services from Keyland Developments (the trading arm of Kelda Group and sister company to Yorkshire Water), Cornerstone Property Assets, and Morgan Sindall Investment. Although created following an OJEU process held by Barnsley Council, the framework can be accessed by councils around the country. “An authority can make its contract acceptable to other organisations nationally and it negates the need for repetitive repeat procurement exercises,” says NPS Barnsley managing director Karen Temple. The framework also has a land advisers panel: Arcadis, Cornerstone Property Assets, Edward Architectural Services, and Turner and Townsend Project Management. Peter Garrett, managing director of Keyland Developments, which already carries out land promotion on Yorkshire Water’s 70,000-acre estate, says council chief executives have been interested in its services but had previously been put off by having to go through OJEU, which has to be used for contracts above a £164,176 threshold. Keyland announced its intention to extend its services to public sector partners in 2014, but this will be its first framework. “For local authorities that have the assets but they are not necessarily in a saleable state, and they are interested in generating a receipt from that, this is a way in which they can tap into the private sector expertise at no financial risk to themselves,” says Garrett. Central Bedfordshire Council launched a similar land promoter framework last year, with five companies, including Telereal Trillium, appointed to offer services to Central Bedfordshire and 17 other local authority members. The public-private partnership allows the council to retain ownership of the land, while Telereal funds the planning process, investment in site infrastructure and subsequent disposal of the consented land to the housebuilder. It sounds like good news for councils, but will it be welcomed by the housing industry? Alex Dawson, head of public sector ­consultancy at Savills, thinks so. “It helps bring land to the market,” he says. “It’s public and private sector working together to deliver housing partnerships.” While some housebuilders do their own land promotion directly, he said the frameworks were not necessarily extra competition but a response to the growing market from local authorities looking to secure long-term income from assets rather than just selling them off. Scale of the opportunity • At least 2.2m acres (6%) of all freehold land in England and Wales is owned by public sector organisations. • Of this total, 15% of all land in urban local authority areas is owned by the public sector. • Around two-thirds of public sector land is owned by local government. • At a local authority level, the eight locations with the highest proportion of public land (more than 40%) are: Brighton & Hove Barking and Dagenham Eastbourne Rushmoor (Aldershot and Farnborough) Gosport Leicester Portsmouth Stevenage Source: Telereal Trillium and Savills Central government land release targets £5bn of receipts from land sales by 2020 Land with capacity for 160,000 new homes to be released by 2020 600 out of 800 government office buildings to be vacated by 2023 34 out of 54 central London office buildings to be vacated by 2025 • To send feedback, e-mail louisa.clarence-smith@estatesgazette.com or tweet @LouisaClarence or @estatesgazette