Christian Ryan, Author at LD Events

With our 17th annual Affordable Housing event on 9th March, we caught up with Kate Ives, Strategic Growth Director at Countryside Partnerships to talk about social value and the importance of it in the affordable housing arena.

Kate is a geographer, town planner, housing practitioner, and social impact champion. Her work centres around housing delivery but a significant part of that is wider regeneration on major city projects such as Beam Park in Barking and Clapham Park in Lambeth. Kate’s centre of gravity is always directed towards supporting and helping others at a community level, and she does that through active management of the social value impact teams that she runs. Her role sees her working with the public sector to deliver long term regeneration on public land, working in partnership with local Councils, housing associations and local community groups. She also represents Countryside on JV project boards and supports good governance practice. Please follow her on LinkedIn here.

What does social value mean in a property context?

It means giving back to local people beyond simply adhering to planning requirements. It’s adding to local communities. It’s an opportunity for the property sector to be responsive to the local needs, using a business model to support local issues and challenges. It is very place-based and allows a tailored approach to each area. There are two aspects – ESG (corporate, how we perform as a business overall) and the social impact work we do that makes a real difference to people’s lives.

How can property development deliver additional social value?

Through the partnership housing model where private developers work collaboratively with the affordable housing sector, build to rent sector and third sector. Collaboration is key to delivering more of social value. By finding those shared opportunities to do more we can achieve greater results. A good example of that came in April 2022. Countryside Partnerships joined forces with the London School of Economics and Political Science (LSE) and Make Space for Girls (MSFG), a charity which campaigns for parks and public spaces to be more welcoming to teenage girls, to develop an industry-leading approach to inclusive design in public spaces for young people, particularly young women.

We commissioned Dr Julia King, a Research Fellow at LSE Cities and a design practitioner, to investigate how the design of public spaces impacts their use. This research revealed that UK parks and public spaces are dominated by teenage boys and that consultation with women and teenage girls is critical to informing the inclusive design of public spaces. By working together to explore how this imbalance could be changed we were able to achieve demonstrable change. We have now evolved this model into a full “micro apprenticeship” called Researcher in Residence, where LSE Cities and MSFG run a programme for girls and young women to research local issues of public space and access in their neighbourhood. Local researchers are paid for their time, and they produce a report outlining their findings and suggestions for how places can be more inclusive to all. This model is a platform that is now available to all housing delivery partners so it can be scaled up through creating access for all.

And last week, we launched two really important initiatives. Firstly, Box Up Crime, supported by Countryside Partnerships, have set up a new youth engagement and crime diversion activity for young people on the South Kilburn Estate in Brent. The programme will be hosted at the local Granville Community Centre and will run for 12 months Countryside are providing funding as well as support services to make the programme an embedded part of the South Kilburn estate. Over 40 young people attended the first session.

And secondly, we launched a food and wellbeing programme at the Clapham Park estate where residents can come together in a warm space at the local community centre “The Cube” whilst sharing a free meal served by Be Enriched food charity. Residents also receive coordinated support around things like health checks, energy saving packs, and cost of living support. We had over 45 people take part on the launch day.

All of these programmes are delivered in collaboration with partners and take hours of planning and work to make them happen. Each has been designed to respond to local need, and to help residents live well. I hope by sharing these examples you can see that there is no “one size fits all” corporate strategy about making a real impact. Its what happens on the ground, working with individuals, families and communities, that matters most.

Where are the opportunities for this market?

At Countryside Partnerships we’re working with Future of London to see where we can add additional value across the sector. As an industry there is a growing opportunity to support people to live well. By working together with a database of practitioners in the social impact sector we will be able to more easily find community projects and partners, enabling the sector to amplify and accelerate existing excellent projects, rather than reinventing the wheel.

What would this database look like?

The idea is to have a map of what is being delivered in local areas coupled with existing partners to see what is available and where developers and housing providers can tap into existing work. We want to find ways to take the friction out of social impact delivery, and a shared, free to use data base of projects and practitioners will help the industry deliver more, and at an improved pace.

What are you planning to speak about at the conference?

I’ll be at the conference speaking about some of our creative investment models, and how they are underpinned by a shared purpose with our partners. We have some fantastic examples of projects delivering at pace, with high quality housing outcomes, and creating real social impact which I want to share. But beyond that, I want to give the conference participants my top predictions for the way housing will be delivered in the future and what will be important to those delivery models. We will really have to gear up as a sector to make more housing happen, and Ill tell you just how we are doing that at Countryside Partnerships.

Any final thoughts?

There are so many headwinds for the sector that we are grappling with. Coming together for the 17th Annual Affordable Housing Conference enables us to share ideas, discuss solutions and consider collaboratively the many ways we can keep going as an industry. At Countryside, we truly believe in the mixed tenure, partnership housing model and there is no better place to listen and talk to our partners than the Annual Affordable Housing Conference on 9th March. I look forward to seeing you all there!

To learn more about affordable housing, book your ticket to our 17th annual Affordable Housing Conference here.

Retrofitting residential property – now is the time

Ahead of our 16th annual London Resi event on 8th March, we caught up with Rory Bergin, Partner, Sustainable Futures at HTA to discuss retrofitting insulation in the residential market.

Rory’s role is to develop excellence in sustainable and innovative design and construction, enabling HTA to achieve its objective of leading the field in sustainable placemaking. He has an impact on many of HTA’s projects, overseeing the practice’s implementation of sustainable design and the use of appropriate tools.

He leads a team of consultants advising clients on sustainable design and prefabrication. Clients include manufacturers of products and systems, as well as landlords, contractors and developers working in the offsite sector.

He has been involved in several research projects into the use of digital tools and volumetric offsite construction and has worked on many construction projects for residential and student accommodation using this technology.

Rory and his team are responsible for the sustainability consultancy on some of the UK’s highest profile housing projects including Hanham Hall, one of the UK’s largest zero carbon residential projects.

So Rory, what’s the background of retrofitting?

Over the last couple of decades here have been multiple attempts to do this to retrofit insulation to get us to net zero by 2050. None of these efforts have worked. At the moment we have a set of piecemeal funding regimes that are aimed at specific parts of the market and only available to certain institutions. As a private homeowner there is very little help available. It’s going to be expensive to get net zero ready and currently there are a lack of options for homeowners and landlords and few companies offering help.

For example, the green homes grant scheme ran for a couple of years and I personally used it. As a homeowner of a London terraced house I couldn’t find a single person to install sash windows under the scheme. Installers weren’t interested.

Generally speaking homeowners and landlords have the means to invest but they need some assistance to get a project like this off the ground. Otherwise people will leave it until it’s mandatory. The help that’s available in terms of grant funding is limited, small in scope and highly targeted.

The biggest scheme available (for energy companies) involves 150k properties over four years. We have 24 million properties with 18 million needing some kind of retrofit, so the biggest scheme currently available falls woefully short.

We’re a long way from a solution. There is a task force being formed so there is some acknowledgement from government that help is needed, which is positive. The increase of gas prices over the last 18 months have highlighted how important it is to use less gas, which retrofitting will aid. Plus it’s a fossil fuel and we should stop using it as soon as possible.

With all that in mind, what is the solution to get more houses retrofitted?

The thing the government has never been good at is long term planning. Whatever happens with parliament, retrofitting residential property has to be a long term solution. A retrofit programme will take decades to deliver so it’s got to be looked at in a wider context. A government department needs to be created, as this will create focus and responsibility. Essentially it has to be taken seriously. Something like the green deal from 2010 but with more weight behind it would work well as there is more awareness now. By insulating properties you remove the need to store, import and invest in gas infrastructure. This will also save money by not needing to build more power stations. As a whole, the country would be better off by investing in retrofitting homes. If people are in better homes they get ill less often and so reduce the impact on the NHS. Comfort and wellness has a trickle effect through the whole economy and good quality homes have a huge impact. All of society will benefit if the longer term view is taken. Less fossil fuels, better homes and an increase in public health. It’s a no-brainer!

What is your prediction if this issue isn’t addressed soon?

We’ll drift on, get to 2050 and miss a huge opportunity. We will end up with homes that are still burning fossil fuels and leaking energy. If heat pumps are installed (a potential knee jerk reaction to get to net zero), rather than gas boilers more kit will be rushed into homes without improving them. People switching to heat pumps will not save money but they will do by retrofitting houses. It also means that where gas heating is changed to electricity we will need more power stations which will be expensive. By having schemes in place to retrofit homes contractors will be more interested in the work and it will end up much cheaper for the consumer but as I said, it needs long-term strategic government involvement.

How would this be organised?

Contractors would need to work together with rates of installation agreed in advance. Once the work has been agreed, geographical changes do not have a massive impact on the work involved so prices could be agreed street by street. Limits could be set and prices would be more attractive to home owners due to larger volumes. At the moment there is zero protection on fees and limited contractors willing to carry out the work.

To hit a zero carbon target a house has to be insulated every minute (perhaps two!) to hit the target of 2050. We’re hugely behind this target. We need a government that is interested in retrofitting over the long term. It will pay for itself as energy prices are not likely to go down by much. Not to mention the health and economic benefits that I’ve mentioned earlier.

It also presents a good opportunity for investors that have long term vision/ expectations of yield. Win-win.

Any final thoughts?

Enough work has been done already to prove that retrofitting works. There have been funded pilots and energy companies have done a certain amount of work. There’s plenty of evidence to show what will work and what won’t. We have the technical know-how, we just need to get on with it. It needs widespread organisation – from a government that plans for the longer term.

To learn more about the London residential market, book your ticket to our 16th annual London Resi Event here.

Rents for the four million people currently in social housing were set to rise by a potential 11% in 2023 but in an attempt to limit this rise a government-led consultation was launched in August 2022.

In November Jeremy Hunt announced that following this consultation there would be a 7% cap on social rent increases for 2023/2024. This was welcomed by affordable housing providers and sector professionals as an important step in the right direction for providing security and stability. But what does this mean for tenants? And what are the implications for social housing providers? Let’s take a closer look at this new policy.

What does this mean for tenants?

The 7% social rent increase cap means that tenants who live in social housing will have more secure and predictable rents. Predictions had been made that rents could go up by as much as 11%, so this announcement is good news for tenants who will now only see a 7% rise in their rent over the next year. This also helps to ensure that people living in social housing can continue to do so without feeling overly burdened or stressed about their financial situation. With a strain on finances, 7% will still be felt but it’s a lot more positive than it could have been.

Implications For Social Housing Providers

Although this announcement is beneficial for tenants, it does present some challenges for those managing and running social housing projects. With a 7% cap on rent increases, there is less money available to invest back into the services offered. This means that resources are even more limited than before, and providers may struggle to keep up with demand for repairs or other essential services. In addition, there may need to be extra funding from elsewhere in order to ensure that providers can meet their needs while still offering competitive rents to tenants.

Overall

While there are some challenges faced by those managing such projects due to limited resources, it is hoped that additional funding can be sourced. This would ensure that tenants have access to secure homes at reasonable prices, while also enabling providers to cover costs associated with running these properties without taking too much of a hit financially.

It is also noteworthy that this decision was made after extensive consultation with industry professionals who understand the needs and challenges of the sector. This demonstrates that the government is listening to experts in the field and taking their advice into consideration when making policy decisions. By consulting with those who are most familiar with housing issues, governments make informed decisions that reflect actual conditions on the ground rather than relying solely on computer models or projections which may not accurately reflect reality.

Overall, the introduction of a 7% cap on social rent increases has been widely praised as being beneficial both for tenants and those responsible for providing social housing services.

To learn more about affordable housing, book your ticket to our 17th annual affordable housing conference here.

The London Residential Market is facing uncertain times. The Help to Buy equity loan scheme is ending, prices are unpredictable and there is an ever-shortening quantity of stock.

Ahead of our 16th annual London Resi Conference (on the 8th March), we caught up with Richard Donnell, Executive Director at Zoopla to explore the current market.

Richard is a leading property industry figure best known for delivering insight and strategic advice on the residential and mortgage markets. He also has a deep understanding of how technology and data can unlock business value across the residential and mortgage lifecycle.

Richard runs Zoopla’s thought leadership leveraging their unique data assets and consumer insights to provide market leading insight for industry leaders across investment, development and mortgage lending, including Government.

Richard started his career at Savills in 1994, moving to data and analytics business Hometrack in 2006 which was acquired by ZPG Plc in 2017.

So, how is the current London residential market looking?

For the last five years the London market has lagged behind the rest of the UK, both in terms of prices and volume of transactions. Multiple tax changes from 2013 coupled with Brexit in 2016 resulted in the volume of transactions dropping by 30% by 2019.

It’s the volume of transactions more than sale prices that support business plans for land purchase and investment. The higher the volume of sale, the stronger prospective investment is.

Although the volume of transactions is up, markets outside of London are still increasing at a quicker rate. London’s biggest challenge is affordability. It is an expensive place to live.

There is a lack of stock, prices are high and the way we work (the need to live within commuting distance of the office) have all changed. This all adds up to a flatter than expected market.

With this in mind, what do you think will happen to house prices in the next 24 months?

We think UK house prices will fall by 5% next year. This drop will probably be slightly higher in London with a predicted reduction of 7%. The most expensive markets will be hit harder by higher mortgage rates and with London being at the top of this list, it is likely to be towards the top end of projected price reductions.

Where are the opportunities for this market?

There are potentially a lot of opportunities here. London is attractive to overseas investors as there is more value for money currently. When interest rates come down, we will be an even more attractive proposition. As the dollar is so strong London property is the same price as it was 10 years ago which will start to attract more foreign investment.

Historically, south of the river was a focus for development but there will be more development in central London as office space and retail isn’t utilised as much as it was pre-pandemic but the risks of development remain high.

This assumption comes with a lot of caveats but investing in central London residential property could present a great opportunity for the right investors with a long term view.

What’s happening with the London new build market?

40% of all new builds in London are bought by UK investors. 22% are help-to-buy (although this scheme is ending), 12% is foreign investment, 6% is a switch to affordable housing, 4% bought by home owners and 3% are bulk deals.

Currently, there are no replacement products for the 22% help-to-buy market. The question is “how will we attract additional investments to cover this sizeable gap?” In addition to this, the number of homes being built are the lowest for 10 years as the demand for new build homes is in decline.

There’s a huge affordability challenge here and builders will be reluctant to reduce their headline prices as there is not let up in cost pressures for developers..

The bigger question is what is going to drive London’s economy? Grads have tended to stay in other cities and if the employment base and immigration tightens further, the economy won’t grow fast enough to really drive the demand for home. The government is signalling that it knows that the financial market workplace needs some attention, which will attract international investment and employees. This will hopefully stimulate the London economy, bringing new build property with it.

Are there any surrounding towns worth keeping an eye on?

One of the challenges with London is it’s surrounded by green belt land. It makes it very hard to do substantial build projects around the greater M25.

Swindon, Milton Keynes and Peterborough are key areas for growth – all are accessible and are currently delivering a lot of homes. If people only need to be in the office two days per week the potential reach of where to live is getting bigger. When employees were expected to be office based five days per week, people were mindful of not having a long commute. For the people working from home places such as Margate, Hastings, Bristol and Bath are all real options to live in. These are the areas worth keeping an eye on.

Any final thoughts?

It’s not been easy in London for residential developers for the last few years. Policy costs have been rising on numerous fronts and with lower price gains this is putting pressure on scheme viability. Sales rates and pricing will be support by faster employment growth. , We need a clear strategy for the creation of jobs in London and capital to drive investment, which will all drive the housing market. The London residential property market is currently rediscovering its position as a global city in a more regulated, post-Brexit economy.

To learn more about the London residential market, book your ticket to our 16th annual London Resi Event by clicking here.

It is fair to say that legislation for Integrated Retirement Communities (IRC) needs reforming. With legal confusion around the difference between IRC, traditional retirement living and care homes, it is little wonder that consumers are not clear. Confusion creates uncertainty, deterring investors, consumers and wider stakeholders alike.

By taking a fresh look at tenure in IRCs there is a strong argument that legal reform will lead to more choice, better protection and ultimately lower costs for residents whilst still accessing the care and support that they need.

What’s wrong with the current set up?

The current leasehold model does not fit the innovative IRC approach. There’s an argument that it doesn’t fit legacy leasehold either – some of the legislation is over 300 years old. There are a number of current issues (as highlighted above) which all stem from a lack of reform since the IRC market has developed. IRCs are an innovative solution for residents seeking age-appropriate housing who want to maintain independence by not moving into a care home. With the IRC approach, residents can enjoy independent living with the support of a peer community and long-term care service providers. It is a relatively new approach to retirement living and as such legislation hasn’t caught up.

How can the IRC legislation be fixed?

As with anything, legislative change will not happen overnight. At the moment the legislation isn’t fit for purpose but this is not because it’s been poorly designed, it’s that the market has rapidly moved on. By creating a single regulatory system for the sector (with the necessary power to enforce standards), clarity would be restored. With this additional clarity it is likely that additional funding would follow, increasing the prevalence of IRC projects which further enhances credibility. Alongside this, a single regulatory system consumer rights law needs to be examined. This would protect consumers, developers and operators, ensuring that all parties have clear expected standards. Whilst things take time, there is evidence of this working well in New Zealand with its Retirement Villages Act (2003) leading to 20 years of growth.

In conclusion

Reforming the current IRC set up can only be a good thing. More clarity will lead to protection for residents, lower costs and a more attractive proposition for developers. With an aging population and a rightful focus on the care home industry, IRC has to be a focus for the property market.

To find out more about this, book your ticket to attend our Care Homes & Retirement Living conference on the 23rd November here.

References

Ahead of our Care and Retirement Living Conference in November, we caught up with Henry Lumby, Chief Development Officer at Amicala, and Executive Director of Allegra Care to discuss the recent spike in investment in the senior living (care homes and retirement living) sector.

2021 was a record-breaking year for investment into the UK seniors housing market with institutional investors committing £1.4 billion, so why now are we witnessing such demand for senior housing investment opportunities?

With an ageing population and a heightened awareness of the senior living opportunity post-pandemic, those looking to expand their property portfolio have started paying attention to the possibilities of the care and retirement living landscape.

Full of possibilities, Henry describes Senior Living as ‘the next big growth sector, with potential to be larger than BTR and Student Housing put together’.

What are some of the key differences between care homes and retirement living?

Both care homes and retirement living options are geared towards creating a comfortable environment for seniors, but they are centred around slightly different age groups with different requirements when it comes to the care they receive.

While retirement living offers seniors an opportunity to create a home for themselves in a more community-based space with the peace of mind of care and support being delivered as and when they need it in their home, care homes have the purpose of providing a greater level of care to individuals that are typically older and higher up the acuity scale.

Despite this, Henry believes ‘there is space for significant growth in both sub-sectors of the senior living property sector’

While there is a lot of investment in traditional properties and BTR, retirement living hasn’t always been of high demand to those wanting to build their portfolio, why is that?

The government have long been seeking a solution to the adult social care crisis to no avail. Despite huge strains on the system throughout covid-19 and ongoing challenges surrounding planning and legislation, government think tanks have seemingly turned their focuses to integrated retirement communities as part of the solution, along with changes to the way that care is funded.

‘Momentum is building in the UK as there is a low provision of housing and a high demand.’

As such, we are seeing focus on changing planning policies that will support the concept of integrated retirement communities, as well as the aforementioned increase in investments in the sector that will undoubtedly enable growth. Consumers are benefiting from more choice in product, tenure, services and locations and this is translating into strong take up.

With all of the investments taking place, what will happen to care homes?

While we are likely to see a huge boost in developments that support retirement living communities, there will without a doubt still be a high demand for care homes due to the specialist care they provide in areas such as dementia.

Despite the pandemic demonstrating the pressure care homes were under, it has also highlighted the investment that is required for a number of existing care homes across the UK to properly support a functional care system. We are still year on year closing more beds than we open, yet we continue to see the over 85’s grow significantly.

‘The care sector provides a defendable sector from a need and demographics perspective and is expected to be an increasing focus of investors looking for stable investments post the retail sector downturn.’

An integrated retirement community equally offers a suitable option for both care home and residential living demographics, encouraging us to anticipate that this may be where the future of care is heading, and is the consumer take up very much supports that.

Are integrated retirement communities attractive to investors that aren’t looking to diversify their investment portfolio?

Though there is an attractive element to diversifying an investment portfolio, we are seeing several big-time investors utilising their knowledge and understanding of retail-driven and build to rent and hotel environments and making applications to senior living property investments.

Despite the fact that diversifying a property portfolio is attractive to investors, there are a number of additionally promising attributes to this sector in the current investor’s landscape, such as:

Long-term income
High demand
Greater choice and opportunity for seniors (guaranteed income by covering numerous price points)
Opportunities to provide specialist services (respite, end-of-life care etc.)
Providing a greater level of care to seniors

Will this surge in investment impact other sectors of the property market?

This surge will likely drive competitive pricing on land and at some point begin to impact the investments that are made into other common investment sectors such as BTR, but this should eventually equalise.

Beyond the impacts of investment for investors, this uptake in attention to the senior living property sector will undoubtedly begin to alleviate the care crisis.

Henry wrapped up by mentioning that ‘Both care homes and retirement living options have experienced stunted growth in the years leading up to and throughout the pandemic, but they are emerging stronger than ever and I’m really excited to see what the future holds.’

Have you considered investing in the Senior Living property sector? Let us know on Twitter!

Want to hear more about investment opportunities in Care and Retirement Living? Check out our upcoming Retirement Living Property Conference and get yourself tickets to be a part of the action on the 23rd of November 2022.

The growth of the single family housing market is indicative of the UK going from strength to strength with BTR (build-to-rent) offerings.

While many think of BTR as city-based flats and purpose-built apartments for young professionals, the market for BTR properties is quickly expanding and proving to be of great intergenerational appeal, particularly to young families that have limited mortgage options in the current property market.

So, what is single family housing and why is it rapidly rising in popularity in the UK rental property market, especially when it comes to building investment portfolios?

What is single family housing?

Technically speaking, a single family home is one that is purpose-built for the rental market to serve young families.

On the larger end of the scale when it comes to typical build-to-rent properties, single family homes are offering space and functionality for families, something that is becoming increasingly popular in the UK in the midst of a tough buyers’ market as a result of steep increases to house prices.

The post-covid climate is also thought to have inspired families to leave bigger cities in search of more space and a healthier work-life balance.

This is placing single family housing as an extremely attractive investment amongst private rental investors and developers with many achieving reliable, healthy returns.

Why is single family housing becoming so popular?

There are many reasons that single family housing is becoming such a popular BTR option in the current UK private rental sector. These include –

Providing affordable options for those ruling out buying in the current property market
Long-term housing opportunities for families looking to settle in one place for longer
Increased space in suburban areas to improve work-life balance in the post-covid environment

Why should you invest?

As well as expanding your current property portfolio, single family housing is proving to be an increasingly popular option amongst young professionals and it is anticipated that this rental option will become the “new normal” with great intergenerational appeal. Other reasons to invest include:

Rising demand for family-style homes
Well-performing assets for property investors
Shorter void periods in comparison to other rental properties – families are more likely to stay in one place for longer.
Increasingly attractive to developers looking to expand their portfolio

What are your thoughts on the rising popularity of single family housing? Let us know on Twitter!

Want to hear more about opportunities in the alternative residential market? Check out the agenda for our upcoming 6th Annual Alternative Residential Property Conference and get yourself tickets to be a part of the action on the 27th of September 2022.

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Achieving a ‘good’ ecological status is quickly climbing up the political agenda as a reaction to climate change concerns, but our rivers and various other water bodies are hugely contaminated as a result of numerous contributions to pollution. A recent report by the Environmental Advisory Committee (EAC) has called out housing developers for their contributions to the issue.

What is nutrient pollution?

Housing developments have recently come under fire for their nutrient impacts because of increased sewage, wastewater and construction site run-off. These types of pollution are said to be contributing to a rise in phosphorus and nitrogen traces in protected sites, which is increasing eutrophication (algae growth) and damaging local wildlife.

Following a direct report from the Environmental Advisory Committee (EAC) in January, the government has seemingly rejected the EAC’s attempts to impose tougher rules on developments, after scares that this may further delay housing developments across the country in a crisis that has already seen the development of over 120,000 new homes brought to a standstill across the UK.

So, what does this mean for new housing developments?

The problem doesn’t seem to be getting resolved and Natural England, the government’s official environmental advisor, has ruled that 74 planning authorities with neighbouring protected areas are not to proceed with housing developments if there is a risk of impacting nutrient levels. This is a big move that has led to the nationwide rollout of ‘nutrient neutrality’.

Local authorities and developers in areas such as The Solent and Somerset (some of the most affected areas) have been left to their own devices, desperately trying to source solutions that can help to resume high-demand developments across the country.

In the meantime, the introduction of ‘nutrient neutrality’ means that in order for future housing development plans to be approved, the developers must first make sure that their plans are ‘nutrient neutral’, and demonstrate that the number of nitrates released into the local water system as a result of the new development would be levelled by the removal of nitrates to an equal amount.

What can developers do to offset the increase in nutrients?

Introduce new wetland areas to the catchment
Install new and sustainable urban drainage systems
Make cultivable farmland fallow

What are some of the challenges associated with mitigating this nutrient increase?

Local authorities are overwhelmed with planning applications that will not meet nutrient neutrality regulations
Developers are having to front the costs of water neutrality schemes or source land to fallow independently
Increasing housing demands are not being met

How will this affect developments over the coming years?

The government will be tasked with finding a long-term solution in a short-term turnaround if housing demand is to be met and the currently paused developments to be given the go-ahead to continue.

Strategies to solve the issue must be developed with water company partners to ensure the solution is sustainable, cost-effective and environmentally efficient.

While the government has highlighted in it’s response to the EAC that this issue is a priority, there has still been little information available to support actual plans and zero movements when it comes to air-tight mitigation schemes.

What is your stance on nutrient neutrality? Let us know on social media!

Source list –

Formally adopted in April 2016, the Community Infrastructure Levy (CIL) is a local authority delegated charge to developers that enables fundraising for infrastructure, facilities and services needed to support new homes and businesses in the surrounding areas of large-scale developments.

Despite the aims of the CIL to provide a faster, fairer and more transparent way of driving developer contributions to infrastructure, criticisms have centred around the distinct lack of flexibility, calculation challenges and overall viability.

However, there is hope on the horizon. After announcements in mid-May regarding the Levelling Up and Regeneration Bill, the Government is seemingly set to phase out the current under-performing CIL in several locations across the UK, replacing it with a new and improved Infrastructure Levy (IL) that is intended to also encompass some of the s106 agreements. So, what are the key differences between CIL and IL?

CIL vs IL

Although the term ‘infrastructure’ is not defined in the newly published Levelling Up and Regeneration Bill, it is suggested that the term alludes to roads, schools, medical facilities, shops and green spaces that support the associated development and the local community it serves.

One major difference between the levies is the measurement and liability of contributions. While the CIL is calculated by the square metre (multiplying the CIL rate by the net chargeable floor area, taking into account the changes to building costs over time), the IL rates will work more like a tax, charged as a percentage of the final gross development value (the forecasted revenue from the completed development scheme). This will enable communities to recover land capture value (a policy approach that enables communities to recover and reinvest land value increases that result from public investment and government actions) at a higher rate.

Another critical change with the introduction of the new IL will be the mandatory element of contributions from developers. While the CIL was discretionary and varied from one local authority to the next, the new IL proposes that in conjunction with the s106 agreement, elements of ‘integral infrastructure’ such as flood risk mitigation, play areas and most importantly affordable housing will be sought by local planning authorities (LPAs) to ensure developments are classed as acceptable and uplift land value.

Despite this promising outlook on integral infrastructure, there are concerns in the housing sector regarding the likelihood of the IL being able to match the delivery of affordable housing under the s106. As a result, a framework agreement has been included in the bill to ensure the number of affordable housing properties gained through developer contributions will be matched if not exceeded under the new levy and there are suggestions that this will be formally regulated in the new bill following consultation.

In addition to several positive changes intended to be included in the IL, it is thought that LPAs will seek contributions to biodiversity net gain from 2023 onwards. This is another significant step towards improving the viability and sustainability of new developments.

To conclude

Overall, the new government IL will likely be able to obtain its intended ‘simple, mandatory and locally determined’ status and the newly proposed method of rolling out the levy as a ‘Test and Learn’ approach promises to form the most effective system.

There is a consensus that the updated bill and newly introduced IL will improve the viability of infrastructure delivery in a timely manner, without a number of challenges surrounding scale and calculation.

ESG (Environmental, Social, Governance) factors are rapidly changing the landscape of residential development.

With new legislation imminent, UK residential markets and several subsectors are gearing up to see how they will be affected by the changing demands of future occupants.

Ahead of our UK Residential ESG & Sustainability Conference on the 5th of May 2022, we talked to Lawrence Bowles, who will be chairing the event.

As a Director at Savills, and with a special interest in research, Lawrence has a wealth of knowledge surrounding the impacts ESG strategies will have on property professionals.

Here are our thoughts concerning the rise of ESG in UK residential markets and how it’s now more important than ever before.

Why has ESG become so important?

With uncertainty rising in numerous other parts of the economy there is now seemingly more attention on ESG and the impacts of our subconscious decisions on the environment.

As confirmed in one of our earlier articles, ESG: the three letters that everyone is talking about, the construction sector is one of the largest energy consumers in Europe, contributing to 36% of CO2 emissions, something that is undoubtedly catching the attention of both political and public agendas.

We have emerged into a new era, whereby Gen Z are more inclined to share their opinions. Despite most of these opinions being shared in digital environments, the scope of their influence is unparalleled and is garnering increased support for more considered decisions within the construction sector.

“We seem to have reached a demographic tipping point”

With such influencing power over other generations (and even legislation), the decisions that landlords, developers and housing associations make from this point have no choice but to take into consideration more than just demand, associated costs and government rules, but the desirability of development on the basis of its ESG impact.

How can ESG be measured?

One question that hasn’t got a particularly easy answer at this point surrounds the measurability of ESG.

Whilst measurable items such as energy performance, the number of employees and company culture are easily tracked, there is yet to be a set of comprehensive measurables published. Even then, some of the measurable items are flawed in their ability to demonstrate true ESG relativity.

“Are we measuring the right things?” is a big question at the moment.”

While a collective definition is a long way off many are of the opinion that acting on the known solutions to ESG factors will improve the situation until there is a list of comprehensive measurements available from the government.

Some improvements to ESG contributions could include offering apprenticeships, assigning hours to pro-bono work and increasing job prospects in the local community.

What are the key elements of ESG in residential markets?

A number of variables affect ESG in residential markets. Depending on the type of organisation and the role each party plays in development, investment and property management, there will be different prioritisation in values.

For example, while developers are striving to clearly demonstrate modern methods of construction, promote apprenticeships and encourage community involvement, operators and investors are looking for clean, green and socially positive spaces that will remain attractive to future residents for years to come.

While this is clearly not just a tick box exercise and values will differentiate between developments, there are certainly some similarities in desired qualities, namely that the property in question is both socially appealing and affordable – another big topic on the residential development agenda at the moment.

What are Developers, Operators and Investors looking for when it comes to ESG contributions?

Thoughtfully designed structures that are straightforward to develop and in in-demand locations.
Future-proofed developments that minimise long term spend and capitalise on ESG contributions.
Data-led communications about stock and structure between all areas of property development, investment and management in order to meet long-term climate measures.

While there are several government organisations and businesses across the UK implementing ESG strategies through specified teams, it could be argued that the biggest impact can be made by individuals sharing their knowledge of ESG strategies within their own residential subsectors. This is an ongoing discussion we hope to contribute to following our Inaugural UK Residential ESG & Sustainability Conference.

“It is important not to understate the impact of individuals championing ESG contributions – the work being carried out after this conference has the ability to impact ESG discussions and change the world.”

Interested to learn more?

Keep the conversation going at the Inaugural UK Residential ESG & Sustainability Conference being held in London on Thursday 5 May. Bringing together experts across the residential markets and its subsectors, the event will focus on understanding what ESG means, how to implement practical changes, the relevant legislation that’s being put in place and importantly, how ESG can be measured. There will also be discussions around achieving zero carbon homes, the changing workforce and how organisations can mitigate risks and futureproof their businesses.

Book your place!