A One Day Briefing
Stopping Affordable Housing Eating up your Development Profit
Chairman
Naomi Goode
Partner, Property, Housing & Construction
Lewis Silkin LLP
Speakers
Steve Billington
Partner, Residential
Drivers Jonas
Marc Dorfman
Chief Planning and Regeneration Officer
London Borough of Redbridge
Neil Euesden
Chief Operating Officer
Pinnacle
Ben Halsey
Associate, Property, Housing & Construction
Lewis Silkin LLP
Tim Holden
Group Development Director
Network Housing Group
Andy Leahy
Managing Director
Bespoke Property Group
Anthony Lee
Director – Affordable Housing
Atisreal
Walter Menteth
Partner
Walter Menteth Architects
Christopher Munday
Partner
Trowers & Hamlins
Julian Thompson
Partner, National Head of Affordable Housing
King Sturge LLP
Getting under the threshold
• PPS3 has replaced Circular 06/98 and 25. How the effects of lower threshold should be dealt with by a developer
• How to avoid risk of planning refusal for under development
• London boroughs are now bringing in ‘10’ as threshold for affordable housing; how can developers deal with ever lowering thresholds?
• Can mixed use development get you under the threshold and provide a better return? Can commercial property pay? Are houses rather than flats a better option?
• Can live/work or elderly persons/care accommodation provide a solution?
Establishing non viability and viability – when do we need to establish viability?
• Viability in the context of planning law, PPS3, and Delivering Affordable Housing
• The effect of Community Infrastructure Levy and Tariffs
• Using a viability toolkit – running through a live example
Consequences of upcoming changes – certain and possible
• Lowering thresholds. How this will affect viability
• How changes to National Affordable Housing Programme will help deliver affordable housing
• How use of “aparto-hotels” and holiday lets in certain areas provide an option
• How will additional powers given to the Mayor in London affect affordable housing?
• How is the financial muscle of RSLs influencing the market in the current credit squeezed housing market
Design solutions to create maximum value
• Architecture and the value of good design
• Exploiting necessity – circumstance as the mother of invention
• Delivering sustainable futures – understanding the contemporary context
• Change – flexibility, future proofing and space standards
• Delivering benefit from construction and procurement innovation
Getting ongoing managers that preserve and enhance value
• Value through quality services – national presence – consistent quality services
• Community management
• “Tenure blind” 106 experience
• One stop service
• Local responsibility and accountability
• Absentee Landlords
• Self delivery
• Local supply chain management
Going for the right type of AH
• Meeting housing need and demand
• Different types of AH
- Social rented housing
- Shared ownership
- Shared equity
- What is allowed and what's not
• Which types of development generate AH and how is it calculated?
• Getting the mix right
- Sizes of units
- Location within the site and building
• What is the best tenure mix for commercial success?
• Will the Homes and Communities Agency assist or hinder?
• What alternative finance vehicles are available for AH other than just RSLs
Getting the ‘right’ SHL and the right deal with the SHL – being the SHL, competing with RSLs that buy ‘your’ site from under your nose
Getting the right "Affordable Housing Partner"
• Know the market
• What does the market want
• What are the alternatives
• Match the product to the market
• Marketing and disposal strategies
Negotiating with the Local Planning Authority (LPA)
• Know local, regional and national policy
• What is policy seeking to achieve?
• Viability issues
• S106 agreements
Being the SHL
• Cash flow calculations and the 30 year view
• Income/maintenance/sustainability trade-off calculations
• Valuing and retaining the reversion – how to achieve it, how to benefit from it – routes to monetisation
• Premium and rental trade off calculations
Ensuring you have a favourable nominations agreement
• Choosing the right form of nominations agreement
• Cascades, fallback and timescales
• Ensuring nominations agreements do not damage funding
• Interaction between nomination agreements and owner occupiers
Understanding the Mayor’s Policy on Affordable Housing now the election is over?
• What was said before the vote?
• What has he said since the vote
• The changes the Mayor will make
• What will not change
Current thinking on clawback
• Cascade mechanisms
• Variations in s106 Agreements to take account of increased developer's costs
• Altering the tenure mix where grant funding is not available
• Building in flexibility on schemes that are phased over many years
But its us you’ve got to deal with – A local authority’s approach to setting their objectives and deciding how they will achieve them
• How a Local Planning Authority (LPA) carries out a "housing need" study
• How a LPA links with the Mayor's Strategic Plan on housing growth
• Setting affordable housing policy and standard
• Why affordable housing is so important
• How it supports a strong housing market
• How the private sector can be creative about providing it
We've got our own objectives – the existing RSL view
• Our objectives and drivers
• Our priorities
• Adding value without additional cost
• Financial drivers
• Opportunities for the private sector
Case Studies – examined by a panel of experts:
Private sector developer, LA representative, RSL executive, planner and surveyor review a series of case studies in which the developer seeks to maximise his profit while the LA and RSL seek to obtain their objectives.
Exercises based on real world cases designed to illustrate what is possible and how to achieve it
Moderator: Naomi Goode, Partner, Property, Housing & Construction, Lewis Silkin LLP
Panel:
Marc Dorfman, Chief Planning and Regeneration Officer, London Borough of Redbridge
Tim Holden, Group Development Director, Network Housing Group
Andy Leahy, Managing Director, Bespoke Property Group
Anthony Lee, Director – Affordable Housing, Atisreal
What’s that land worth?
• The impact of affordable housing policy on land values
• Planners’ approach to land values
• Viability, existing use value, development value and affordable housing
• The interaction of affordable housing, other S106 obligations and land values
• Is it possible to meet policy requirements for affordable housing in full and remain competitive in the land market?
• Why are RSLs paying more for land than developers?