A stewardship approach to creating communities
MAKING TWO
PLACE
We would like to thank everyone who has contributed to the making of this report. Benjamin Bolgar The King’s Foundation Ben Murphy Estates Director, Duchy of Cornwall
Hugh Petter Director, ADAM Architecture Lucy Greenwood Director, Savills
Charles Anderson Senior Counsel, Farrer & Co
Nick Tubbs Stockbridge Land and Red Tree
Charles Dugdale Partner, Knight Frank
Robbie Kerr Director, ADAM Architecture
Gail Mayhew Director, Smart Growth Associates
What are modern, successful Community Developments and what can we learn from them as we seek to create better places?
Sam Kirkness Development Manager, Duchy of Cornwall
Authored by:
Designed by:
Cecilia Lindstrom Jack Sallabank Future Places Studio
Ascend Studio
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Introduction ADAM Architecture and Farrer & Co launched the report ‘Placemaking — a patient approach to creating communities’ in February 2020. The research, undertaken by Future Places Studio, explored modern, successful community developments and the lessons they can teach us as we seek to create more convivial and resilient communities. As the country strives to build 300,000 new homes per year, new neighbourhoods should draw from the best examples from our recent past that can challenge the status quo; the UK’s housing crisis is as much about the quality of our homes and communities and the places that are being created as it is about lack of numbers. Introduction
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If the UK is to avoid the blight of poorly designed, soulless dormitory towns and suburbs in coming decades, landowners, developers, and local authorities need to prioritise a more patient and collaborative approach to community development. That involves:
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Taking a long-term view at the outset of a project. Accepting a deferred return on investment, which can lead to greater long-term revenues. Measuring the success of developments through a social and environmental lens (in addition to return on capital or profit). Prioritising the design and community building of a scheme through a long-term masterplan and design codes. Placing greater emphasis on community and local authority co-creation, as well as meeting local needs. Re-thinking the business-as-usual approach to social housing, streets, mixed-use, green spaces and social infrastructure. Putting in place a stewardship model to maintain the ongoing quality of the place. Prioritising community health, wellbeing and social cohesion through best practice design solutions.
A stewardship approach to creating communities
As part of the UK’s effort to bounce back from Covid-19, the government has proposed radical reforms to planning policy in the Levelling-Up and Regeneration Act 2023, which aims to create a more fit for purpose and efficient planning system that can help the country build its way out of the housing crisis. Within the context of these changes, this sequel to Placemaking One revisits the subject of patient development, reflecting on the impacts of Covid-19, the evolving environmental, social and governance standards, and the challenges of the current planning system. The issues highlighted in this report are deeply ingrained in the UK planning system. Within the next 12 months, there is likely to be a general election and we hope that our politicians give careful thought to the fresh ideas brought together in this research, which we believe could play a crucial part in addressing the housing crisis more imaginatively and sustainably.
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Introduction 03–04 / A changing reality 06–09 / A patient approach — spearheading a new form of development 10–31 / A supportive system 32–41 / Conclusion 42–51 / Index 52
Table of contents
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A changing reality Covid-19 had a significant physical, emotional and financial impact on the UK. We were all affected one way or another. However, it also provided an opportunity for us to pause and reassess how we lived our lives pre-Covid. For many, the stresses and strains of the daily commute and the long hours in the office had already taken a toll on our health and wellbeing. Lockdown reminded many of simple pleasures like spending time with friends and family and living life locally. A changing reality
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As lockdown eased in summer and autumn 2020, many chose not to return to the office full time. Instead, they continued to work from home in some capacity, contributing to increased activity in their local communities; formerly sleepy high streets were reinvigorated as people shopped, dined and socialised closer to home, and neighbourhood parks were teeming with life. However, the cost of living crisis has changed consumer behaviour and the UK population is reducing their spend and seeking out best offers over local and independent products. Coupled with increased time spent at the workplace, the support for our local centres and high streets has waned. Nevertheless, some of the impacts of Covid-19 are likely to be permanent and the shift towards more local lives and sustainable, walkable neighbourhoods is likely to remain a strong influence on future placemaking strategies. With many still working part of their week at home, residents have become more discerning and demanding more from the places where they live. Lucy Greenwood, Director of Residential Research and Consultancy at Savills, points out that good walkability, access to local amenities and green space are now higher on the list of priorities for buyers, and houses are favoured over apartments.
"There was an unrealised appetite to do things differently, and it just got captured in a moment in time."
This is not something new. Revisit the 19th Century town planning endeavours and we find the same qualities that people are longing for now in the Garden City envisaged by Sir Ebenezer Howard in 1898: sticky streets where people linger, mix of uses, walkable and pedestrianised places and the invigorating presence of natural environments. These characteristics are also designed into modern community developments such as Poundbury, Nansledan, Burghley and Derwenthorpe, as we explored in the Placemaking One report. So often, rural and peri-urban developments are designed as sleepy mono-use commuter towns, places to return to after a day in the city. The urban design and architecture often follow pattern books that are replicated across the country, creating places that feel somewhat generic and decontextualised. If we are serious about developing sustainable and vibrant places for community life and commerce, we need to move away from mono-cultural housing estates and towards a whole-place approach that puts people centre stage. Landowner investment and care over time can add true value long-term for mixed-use places, with benefits that ripple beyond the development boundaries and into the wider area. Furthermore, the pandemic demonstrated that the 15-minute model, where people’s daily needs can be met within a short walk from home, is more resilient than its mono-cultural counterpart. Charles Dugdale, Partner at Knight Frank, argues that all the trends that covid harnessed were already emerging: “There was an unrealised appetite to do things differently, and it just got captured in a moment in time.”
Charles Dugdale, Partner at Knight Frank
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A changing reality
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A patient approach — spearheading a new form of development Land stewardship is a conscious practice that rests on an understanding that community building takes time and commitment over generations, with a slower return on investment. However, a longer-term perspective rewards the landowner/ developer with opportunities for greater dividends from growth in future capital receipts and rental income. A patient approach
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In this model, quality of place and life are at the forefront, and the increased time-horizon allows the landowner to follow best practice and invest for the benefit of the wider community and the place as a whole. As such, it is spearheaded by landowners that act as custodians of place, that feel an inherent affinity with the places they co-create, and a social and economic responsibility for its future success. Gail Mayhew, Smart Growth Associates, explains in conversation that the housebuilder model is to build homes and then move on, and it doesn’t actually matter to them in ten years’ time what that place is like. “If you are a long-term landowner developing your land, and really care about how the place evolves, you are more inclined to invest in attributes and components that might cost a bit more because you can make the place better, and people are happier to live there.” The vision for Nansledan is led by a land stewardship approach that puts money back into the local economy, working with local people and responding to local needs. This is important, because if people can benefit economically and socially, the landowner/developer can set a precedent for good placemaking that builds confidence and erodes some of the fear of change and growth that impedes development today. If people can sense the positive effects, they are much more likely to get involved in shaping their communities. When people can recognise where their input has been translated into an output, trust between all parties will improve and they will have the confidence to keep participating.1
"If you are a long-term landowner developing your land, and really care about how the place evolves, you are more inclined to invest in attributes and components that might cost a bit more because you can make the place better, and people are happier to live there." Gail Mayhew, Director at Smart Growth Associates
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A patient approach
Today’s system favours the volume housebuilder that is seeking a quick return on investment in a single-use product; there is evidence to show a high tab for land sale upfront, and less data in support of dividends down the line. As a result, landowners who need to demonstrate best value to their trustees and beneficiaries are more likely to sell their assets than staying involved long-term. Current legislation2 states that the sale of public land should respond to the ‘best considerations’ that can reasonably be obtained. This is often interpreted as the highest financial offer; however, the intention is for the landowner to realise overall best considerations without being held to a timeframe. Social and public value as well as environmental and governance benefits, which are likely realised over a longer time horizon, are integral to achieving best considerations. Thus, the Building Better, Building Beautiful Commission’s report Building in Beauty (2020), argued that it might in fact be best consideration not to sell upfront — a particularly poignant point to consider for trustee and public authority landowners.
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A patient approach comes with more risk and time commitment than most landowners and developers are willing to pledge, even with the potential for increased social and financial benefits. The initial cost of land and necessary infrastructure is an impediment to holding on to sites. With many objectives and aspirations shared between long-term stewardship models and local plan agendas — such as delivering affordable homes, key community infrastructure, schools, new recreational spaces and jobs — local authorities could benefit from establishing privatepublic joint ventures that recognise patient developments as essential delivery mechanisms for a common vision, i.e. the developer could help deliver some of the key policies and aspirations set out in the local plan. In return, the local authority could offer up the land or provide it on a leasehold to the developer against a share of the profit, sales price or a building license model, avoiding the need for the developer to make costly land purchases upfront. This would allow many more builders to cashflow developments and open up the market to a much broader range of developer interests, including regional bespoke builders, eroding the almost monopoly position of a very small number of volume housebuilders.
A public/private joint venture could also facilitate a smoother planning process. Patient developments are also challenged from a planning perspective as they often require a dynamic and resilient framework for growth that can adapt over time, as opposed to a fixed and finished masterplan. For planning strategies to be effective long-term, it is paramount to coordinate ambitions beyond party politics and the fouryear term of office, allowing places to benefit from comprehensive policies with a long-term perspective. Such an approach has been taken in Nansledan, where the Duchy of Cornwall has developed a 30-year vision to underpin a more holistic and long-term approach to change that can be delivered incrementally. The patient development model is underpinned by a set of fundamental placemaking principles that add value for the landowner, the developer, affordable housing providers and the community in the longer run. Over the next pages, we explore these in the context of the changing reality that we find ourselves in before exploring the systemic changes that could encourage more developments of a patient kind.
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A patient approach
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Whole-place design Covid demonstrated the resilience and relevance of the whole-place stewardship model, which creates vibrant neighbourhoods with a blend of uses that keep the place alive throughout the day. The recent trend is towards increasingly localised lives, as we spend more time in our communities and working from home. This puts a greater emphasis on complete neighbourhoods that are local and walkable, with a mix of life-giving ingredients. As such, our communities are reinforced as places of social interaction, cultural and commercial activity, with efficient public transport systems, sustained by a critical mass of people, density of homes and increased local expenditure.
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A patient approach
The placemaking value of non-residential uses cannot be underestimated. A long-term horizon and a multi-generational investment approach has enabled the Duchy of Cornwall to curate a diverse mix of small and medium sized independent retailers across their developments. In Nansledan, sustainable rental structures have been offered to businesses that have taken up premises early in the development, which has helped to de-risk the process of setting up shop and has enabled businesses to grow over time. This has started to create a stronger and more diversified local economy, which is expected to develop further as the Duchy looks to progress the first phase of Nansledan’s High Street in 2023/2024 (“Market Street”). Looked at in isolation, the short-term financial return on these commercial spaces can be constrained, but they have been shown to add value in the long-term through rental and capital growth, house price growth, and job creation.
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New retail spaces, a fitness studio and a café all opened at Nansledan during the pandemic. In this tight knit place, people want to support their local shops and services, adding a further sense of community. Local job creation allows people to live more locally and sustainably as they reduce the need to travel. Poundbury has delivered some 2,300 homes of the eventual 2,730. Over 2,650 jobs have been established with more to come, providing over 1.15 jobs per home, which is testament to the landowner’s commitment to curate a blended mixed-use environment with a range of businesses. Gail Mayhew hails this as a remarkable achievement with a strong family dimension: “If you can enable people to live, work and play close to where their children are at school, you give families time back in their day and money back in their pockets. This is incredibly important to family and child development.” Walkability is an essential component of community developments that are people centric, inclusive, integrated, and sustainable. More granular and local movement comes with economic, social and wellbeing benefits, as residents are encouraged to leave the car behind and pick up muscle-powered environmentally friendly alternatives, pop into cafés and shops, and interact with neighbours. Pedestrian friendly communities are inherently more inclusive, knitting and weaving more homes and people into their catchment, welcoming all independent of age or car ownership.
"If you can enable people to live, work and play close to where their children are at school, you give families time back in their day and money back in their pockets. This is incredibly important to family and child development."
A choice of homes — a mix of typologies, tenures and affordable options — that appeal to many different people creates diverse and inclusive communities, which according to Lucy Greenwood has been proven to be beneficial and add value for everyone. Choice supports liveability long-term, as it allows people to age, grow a family, upsize and downsize within their neighbourhood. Longevity also supports community spirit and place identity, which is nurtured through shared experiences and a sense of belonging.
Gail Mayhew, Director at Smart Growth Associates
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A patient approach
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Place specific Patient developments are instinctively sensitive to their contexts, with a deep-rooted respect for local architecture. To create a strong sense of place, Hugh Petter, Director at ADAM Architecture designs places that feel like they belong to their context and argues that it makes schemes more popular. “A scheme in Cornwall should be different to a scheme in Oxfordshire. This is not only because the local vernacular is historically tuned to the local environment and building materials, but because it gives the place an identity that resonates with surrounding buildings.”
"A scheme in Cornwall should be different to a scheme in Oxfordshire. This is not only because the local vernacular is historically tuned to the local environment and building materials, but because it gives the place an identity that resonates with surrounding buildings."
To ensure that the local vernacular is embedded in the new development, site-specific pattern books are produced to define street character, building typologies, materiality, etc, and provide a rich design inspiration for new buildings and squares that resonate with the old. The spaces between the buildings are where community spirit and life are nurtured; so often considered utilitarian in nature, movement networks should be conceived as social places in their own right — platforms for serendipitous exchange and chance encounters between neighbours.
Hugh Petter, Director at ADAM Architecture
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“Allowing a local tradition to evolve and remain relevant gives people a sense of pride and identity about where they live. That doesn’t negate a modern interpretation. Good placemaking is less dependent on style, and more driven by materials, details, the urban form and the flexibility to respond to modern needs.” Robbie Kerr, Director at ADAM Architecture.
"Allowing a local tradition to evolve and remain relevant gives people a sense of pride and identity about where they live. That doesn’t negate a modern interpretation. Good placemaking is less dependent on style, and more driven by materials, details, the urban form and the flexibility to respond to modern needs."
Celebrating local heritage can boost civic pride amongst residents. This goes beyond aesthetics, as a locally inspired design using locally sourced materials and craftmanship supports the economy through partnerships with businesses in the area. This creates new opportunities for people. Everywhere is different and offers up different opportunities. Hugh explains: “On some sites, estate grown timber is used to construct or clad timber frame houses. In Cornwall, we use concrete blocks from local China waste clay — a waste product with a very low carbon footprint and a high performance. This creates a virtuous circle, where you can work in partnership with local people and local businesses. This means that those most affected by development also feel the economic warmth that comes from it.”
Robbie Kerr, Director at ADAM Architecture
The added benefit is transparency in the supply chain, with reduced transport emissions and climate impacts. At Nansledan, The Duchy of Cornwall has built relationships with local supply chains on the back of a 25-30-year build programme. This ensured that the architecture was in keeping with the surroundings while providing long-term security for the quarry and its workers,3 giving them the confidence to invest in staff and machinery that has reduced the cost of extraction, manufacture and supply, for everyone’s benefit.
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A patient approach
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Environment focused Sustainability is an all-encompassing term that goes beyond embodied carbon and fabric first approaches (maximising the performance of the building fabric itself). Part of the patient agenda are considerations around how we can grow whole places in a sustainable way and mitigate the effects of the development. This includes optimisation of land, on site energy production, water harvesting and recycling, biodiversity net gain, and as described above, low carbon materials from sustainable sources. Environmentally friendly homes, using for example Passivhaus designs, reduce occupational cost, which means more money in the family pocket. This might enable residents to pay a bit more for their house in return for a quality product that is more affordable to operate, and that holds its value over time. A report from the Environment Agency4 states that improvements in the resource efficiency of homes lead to reduced utility bills, making a more sustainable home more affordable overall, particularly as the cost of sustainable solutions is falling rapidly due to technological advancements and economies of scale. The report states that: "The quantifiable financial benefits of meeting achievable standards over 25 years are significantly greater than the likely costs. The payback period for achievable standards is less than the seven-year average stay in a house." 5 Furthermore, Santander has reported that house buyers are willing to pay almost 10% more for energy efficient properties, as rising energy prices are becoming a greater concern.6
A stewardship approach to creating communities
Green and blue infrastructure provides natural relief against flooding, soil erosion, water pollution and airborne pollutants. Trees and soft planting have a cooling effect that reduces surrounding temperatures. Spending time in nature is also proven to support our physical and mental wellbeing,7 reducing health costs for our society in the longer run. Common areas and green spaces can be creatively designed to support new forms of social and physical activities that reinforce relationships between residents and connects people with nature. Nansledan has a ‘food strategy’ that encourages people to think about local food production, how it’s grown and what individual households can do to contribute to growing more. Rather than manicured squares with ornamental trees, they have embraced community allotments and orchards and planted ‘edible streets’.8 Alongside private gardens, residents have access to communal growing spaces with integrated play areas that function as social platforms in the neighbourhood. This resonates with a more discerning resident that has high environmental and sustainability standards. Bird boxes have been installed on homes, and bee bricks made from China clay waste encourage solitary bees to live in housing walls near fruit trees, to assist with pollination. Through these small and simple gestures, new habitats can be incorporated within the urban form to enrich the ecology of the place.
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The Nansledan development has enhanced the ecology and recreational value of the wider area through the creation of Trewolack Meadows, a Suitable Alternative Natural Greenspace (SANG) on a neighbouring Duchy farm. This farmland has been restored into an ecologically rich and biodiverse space for the community and public to enjoy. An indigenous mix of wildflower seeds, sourced from local meadows that have not been altered with nitrogen, was sown to establish native wildflower meadows for grazing with Red Devon beef cattle who push the seed back into the ground, managing the ecology of the land naturally. Today, many residents in the wider community walk their dogs in this restored landscape, which exemplifies the kind of virtuous cycle that can be formed if we approach community building more holistically and consciously. Flexibility of use through minimal regulation and easy adaptation can encourage communal activities that bring open spaces to life through seasonal events and other yearround activities. Activation and integration of public spaces provides natural surveillance that increases safety and the sense of safety, which can be further strengthened by cycle and walking links that open up to surrounding communities and a natural flow of people. Walkability is an important factor in community development, or we will continue to build separated neighbourhood enclaves that encourage unsustainable movement patterns and car dependency.
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A patient approach
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"There was a resistance towards the standard volume housebuilder’s product, but when they realised that they were going to get something completely different, the mood changed." Nick Tubbs, Stockbridge Land and Red Tree
People centric By involving communities from the outset and giving them a voice in the process, we can overcome the fear of change and growth and nurture a more positive outlook on developments. One focus must be to demonstrate that development, through a patient approach, can be done differently, with greater benefits to the local and wider communities. Nick Tubbs, Stockbridge Land and Red Tree, explains that in Sherford, there were initially 4,000 objectors. They set up a group called SHARD, South Hams Against Rural Destruction. “There was a resistance towards the standard volume housebuilder’s product, but when they realised that they were going to get something completely different, the mood changed.” A stewardship approach to creating communities
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A patient approach
The enquiry by design process, spearheaded by Ben Bolgar, Executive Director, Projects Team at The King’s Foundation, has been a great success because it encouraged people to pick up pens and get actively involved in drawing up the plans for their local area. It made people feel empowered. The ambition was to upstream democracy in the local plan process, to counter the desktop driven exercises that fail to engage communities. Charettes with developers, landowners, key stakeholders and the public were enabled through the planning performance agreement (a project management framework for handing a major planning application), with extensive conversations and sketch workshops resulting in tangible plans and diagrams by and for the community. This process made it real and place specific.
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"They were so much more engaged as a result of it, really involved. When a planning application came forward, they had been part of shaping it. When you have long term communities that you can engage well with, it is really good." Lucy Greenwood, Director of Residential Research & Consultancy at Savills
The rationale for the enquiry by design process was to define design codes and building types for an area, which could be handed over to the local authority to help shape future development. One challenge is the abstract nature of local plans, which discourages communities to engage — often, it is not until the detailed planning application stage that people truly get involved. Bringing local people along on the development journey is a crucial consideration for landowners and developers seeking to create sustainable places (environmentally and economically). Communities are our best sources of accumulated knowledge, and engagement provides the opportunity to integrate local wisdom and lived experiences into new projects. Lucy Greenwood recalls one of The Prince’s Foundation’s workshops, where villagers made their own local plan. “They were so much more engaged as a result of it, really involved. When a planning application came forward, they had been part of shaping it. When you have long term communities that you can engage well with, it is really good.”
Residents and users could have a continued role as an empowered community association that can be active from conception of the scheme to post-completion, taking a role as estate managers. This is different from a design panel, who has no buy-in and knowledge of the place. Ultimately, the place that is being created will become the property of the people who live there, and as inhabitants and users of the place they are well placed to take on the role as advocates and custodians of the emerging scheme. The community association is also equipped to safeguard against a change of administration within the stewardship entity and hold the developer responsible against the original vision. In today’s market, the patient developer is a rare and brave breed. Choosing to do things differently requires persistence and determination. The current planning and financial systems are not incentivising a long-term horizon for new developments, and there are many stumbling blocks to overcome. In the next section, we explore how a more patient-positive system can be encouraged.
Community involvement helps create harmonious living environments that are responsive to people’s needs and aspirations as they evolve over time. This generates thriving communities where people choose to live, because they feel invested and a sense of belonging; local pride and care for the neighbourhood encourage residents to become enthusiastic stewards of place and design, which helps sustain and maintain it long-term.
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A patient approach
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A supportive system In the current UK planning system, the planning application process for large development sites is complex, strenuous, and expensive. The cost and time dimensions add risk and uncertainty, which make patient developments prohibitive for many smaller players and landowners with stewardship ambitions. The most straightforward route in the greenfield marketplace is to build to sell to generate a quick return on investment, cover planning fees and upfront costs. A supportive system
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To maximise profits, sites are often developed beyond their limits which compromises on place quality and provision of amenities, such as greenspace and children’s play areas. The crux of this reality is that the focus often falls on how to navigate the planning process in the cheapest and quickest way, and not on how to build resilient and convivial places. To rectify this, the cost of development could be redistributed between the public and private sector to remove some of the adverse dimensions from the planning process, including the duplication of costly site assessments, such as the environmental appraisals and transport modelling that developers undertake on a repetitive basis. Often, there is an overlap between sites, and there is a case for streamlining these processes with the local authority as the responsible and coordinating entity. Gail Mayhew argues that if landowners are to commit to a more complex and long-term development process, the public sector needs to be more supportive. It is evident that the patient approach captures more value for land interests, but it has also demonstrated added value for surrounding communities by delivering precious receipts back into the local business economy alongside other benefits such as new employment opportunities and affordable homes.
To encourage a greater degree of public/private collaboration and understanding, Gail co-founded the Kitemark Initiative together with Ben Bolgar and Charles Dugdale, to de-risk the process and remove some of the strains between local authorities and landowner developers that are committed long-term. It is inherent to stewardship schemes to deliver on essential infrastructure, community facilities and other key placemaking attributes, because that creates place value, which in the long run translates into financial value. Therefore, these schemes naturally have a greater alignment of interests with local authority aspirations, which should reassure both planners and community of the schemes’ intention to deliver exemplar places that prioritise the public good. At the core of the Kitemark Initiative are three gateways to incentivise a patient stewardship approach to development:
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A level tax playing field
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Patient capital
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Streamlined planning
One way for local authorities to offer support is to contribute the land and split the risk with the developer, with a share of the profit. In this model, the local authority would be involved throughout the process, and help ensure a much smoother journey. Gail refers to the need for public sector bodies to adopt stewardship principles and standards in the management of public land to deliver on the housing agenda, levelling-up and placemaking.
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Level tax playing field Today, a landowner investor that enters into a stewardship arrangement is thwarted by current legal and tax regimes which create a bias towards short-term development that maximises value at the point of sale, rather than promoting long-term value gain. The Living with Beauty report9 highlights that this is not an aforethought policy, but “the unintended consequence of case law and complex tax codes and decisions for other purposes over many years”. The current tax code promotes build-to-sell schemes in a number of ways:
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While land that is sold on to a house builder is subject to capital gains tax, which may fall below 20%, retained land assets fall under the income tax bracket at a much higher rate, up to 45%. Quick sales of land are also likely to benefit from annual capital gains exemption and value reliefs, which can reduce capital gains tax to 10% for profits of up to £1 million.10 A stewardship approach that is based on land pooling between several landowners may incur tax liabilities before major receipts have been received, an occurrence referred to as ‘dry tax‘ liabilities.
A stewardship approach to creating communities
As a result, the current UK tax system provides a strong impetus for landowners to opt for the volume housebuilder route of quick sales for a quick return on investment at a lower taxation. To incentivise quality placemaking of the stewardship kind, the tax regulations affecting long-term development approaches should be at least neutral with the short-term land-trading system that is prevalent today. One way to achieve a level tax playing field would be to grant a particular tax treatment for long-term stewardship models, to be on par with traditional models of development at approximately half the rate. Furthermore, some of the tax exemptions and reliefs benefiting quick sales could be rolled over to receipts under lease arrangements. Finally, capital gains taxation could be deferred to the point at which a phase or tranche of development is sold on.
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"Being able to access some of that public funding at competitive rates where the risk is borne partly by the local authority in support of the development outcome — this is one of the serious keys to unlocking delivery." Gail Mayhew, Director at Smart Growth Associates
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Patient capital Early-stage equity is expensive and comes with strings attached. This is the stumbling block that often drives landowners down the volume housebuilder route, either because of a lack of funds or an unwillingness to take the risk. Local authorities and central government could assist patient landowners by proactively investing in costly infrastructure and utilities delivery that has the potential to unlock development more widely and provide much needed homes in strategic locations. Global financial markets are increasingly positive towards funding up-front local infrastructure investments to support UK Councils.11 Foreign Capital Investment (FCI) offer large sums over longer time periods at stable rates, which if managed well can generate financial returns on local authority investments through taxes, services, infrastructure use, energy generation or enhanced land values.12 This type of investment is generally dependent on a demonstrable vision and local leadership, which can be provided by the stewardship team. Some UK pension funds will also finance infrastructural investment on behalf of local authorities, with an expected return period of 20-40 years.13 Private financing may also be available from UK and overseas insurance companies, pension funds and infrastructure funds as well as mainstream banks. Pension funds and insurance companies have much greater appetite for longer term funding, which is critical to these projects, and so they may be preferable as a class of lender.
A supportive system
To unlock long-term funding, Gail Mayhew suggests that the government has a role to play to demonstrate that there is profitability in this type of lending, within the margins of risk. “Being able to access some of that public funding at competitive rates where the risk is borne partly by the local authority in support of the development outcome — this is one of the serious keys to unlocking delivery.” The Public Works Loan Board make available affordable funding to local authorities and other public bodies to invest in local regeneration projects. It could be argued that a patient development scheme that delivers on key local plan objectives should be considered regenerative. In Nansledan, the approach was to invest in local jobs and homes for Cornish people who have historically been displaced by tourists and more recently by increased demands and rising house prices during covid. Never before have funds like this been needed more, often in slightly forgotten areas of the country.
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Streamlined planning Given the long-term nature of stewardship schemes, they will evolve through market fluctuations, which requires a dynamic and responsive approach to development. Planning consent is granted within a given timeframe, which means that patient developments are often disadvantaged by the need to reapply for lapsed permissions. With a shared vision between the local authority and the stewardship promotor, a local development order14 (LDO), which is effectively a general planning consent, could offer up a more flexible planning tool that can be used to encourage growth by simplifying and accelerating the planning process. LDOs can be delivered in partnership between local planning authorities and developers, to ease the way for uncontentious development that would promote economic, social and environmental gains. Technical issues and planning parameters, consultations and legal agreements are part of the drafting of the Order, and hence resolved upfront. Communities, statutory consultees, and other stakeholders are engaged from the outset, with an emphasis on shaping the future of the place.
An LDO needs to be accompanied by a consented and rigorously applied design code to ensure a highquality built environment and landscape design to provide the community and local authority some reassurance around the design ambitions for the place. The LDO is certain to grant permission for development within its defined parameters that meet the requirements of the associated design code and planning conditions. This arrangement de-risks the process and provides certainty around the long-term vision for investors, developers and businesses, who can be on site with construction underway within a few months and with minimal planning risk. This is an attractive option as it results in a significant saving of professional fees and time.
Another aspect of the planning system that could benefit from reform is the land allocation process, which is currently based on representations from landowners and developers. This can risk that a piecemeal approach is taken that lacks a bigger picture perspective. In a more planned reality, land would be allocated where growth can be accommodated sustainably — near existing transport nodes, on previously developed land, close to jobs and amenities. With focus shifted towards achieving the right development in the right place, a more rational base for land allocation is established. This approach would provide local authorities with a preparedness for growth and give landowners a presumption in favour of development. An added benefit to this approach is that more comprehensive developments can deliver better infrastructure and amenities for communities. A stewardship approach to creating communities
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Conclusion
Covid-19 has led to shifting priorities; with increased time spent at home, we want more from our local neighbourhoods. Equally, our local centres can enjoy the warmth of more people around for longer periods of the day and the week. The pandemic revealed the popularity and resilience of the whole-place community that blends a convivial mix of life-giving ingredients with a diverse range of homes in a peoplecentric and local design. Conclusion
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Concurrently, evolving sustainability standards have raised our expectations and increasingly we seek out places that promote environmentally friendly solutions, both on the building and community scales. The patient community model delivers on all this. Developed organically over time, and in conversation with local residents, businesses, and landowners, patient developments prove that growth can bring regenerative benefits beyond their physical boundaries and unlock greater financial returns. But in today’s market, a patient development approach requires bravery and persistence, as the planning system and financial markets favour a quick win model that encourages the developer to sell off their land for short-term gains. This report highlights the benefits of a patient development model and makes recommendations for how the UK can incentivise more developments of a patient kind.
The five key placemaking principles of a patient approach are:
01
Whole-place design Self-sustaining neighbourhoods that are mixed-use, local, connected, and walkable. A range of homes supports diversity and allows residents to upscale or downsize within the neighbourhood.
02
Place specific Celebrating local craftsmanship and materials, which supports local businesses whilst creating character and distinctiveness — a familiar place to be proud of.
03
Environment focused Optimising land use and on-site regenerative processes that mitigate the effects of climate change, such as renewable energy production, water harvesting, flood mitigation, biodiversity and ecology.
04
People specific
To make a patient approach more commonplace, a supportive climate is needed that enables a wider range of landowners and developers to hold on to land and accept a delayed return on investment. To overcome the most adversarial impediments in today’s market, three gateways to incentivise a patient development approach have been identified:
Involving communities in genuine cocreation processes that empower people to help shape their own neighbourhood, which in turn can overcome the fear of change. Design of streets and public spaces that put people first.
05
Visionary vigilance Rigorous enforcement and management of the development delivery to ensure that the vision is delivered faithfully without being diluted along the way.
A stewardship approach to creating communities
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Conclusion
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01 Level tax playing field To incentivise conscientious community building, taxation of stewardship development models should be at least neutral with the shortterm land-trading system that is prevalent today. Several incentives could help achieve this: granting a particular tax treatment that is on par with traditional models of development at approximately half the rate; rollover of certain tax exemptions and reliefs to receipts under lease arrangements; and capital gains taxation deferred to the point at which a phase or tranche of development is sold on.
Placemaking Two
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Conclusion
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02 Patient capital Affordable long-term funding from the government, such as the Public Works Loan Board, could help finance regenerative developments that align with public interests and deliver against local authority planning policies. Furthermore, local authorities could offer up public land to the developer through a joint venture partnership against a share of the profit, and help fund larger scale developments with lending from global financial markets, pension schemes, etc.
Placemaking Two
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Conclusion
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03 Streamlined planning process More flexible planning tools for uncontentious sites, such as local development orders, could allow schemes to be built out over a longer time period. This would negate the need to reapply for planning approval once a consent has lapsed (which happens within a few years of permission being granted). Coordinated and digitised site assessments would save time and money, removing the need for repeat investigations. Strategic land availability would give local authorities a preparedness for growth and speed up the process by giving landowners a presumption in favour of development.
Placemaking Two
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Conclusion
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Index 1 2 3 4 5 6
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Citizen Based Social Innovation (London Legacy Development Corporation, the Knowledge Quarter). Local Government Act 1972: General Disposal Consent 2003. Placemaking: A Patient Approach to Making Communities, Farrer & Co 2020. Sustainable Homes — The Financial and Environmental Benefits, 2005. Sustainable Homes — The Financial and Environmental Benefits, 2005. https://www.santander.co.uk/ about-santander/media-centre/ press-releases/a-greenpremium-house-buyerswilling-to-pay-almost-10 https://www.mind.org.uk/ information-support/tips-foreveryday-living/nature-andmental-health/how-naturebenefits-mental-health/ Placemaking: A Patient Approach to Making Communities, Farrer & Co 2020. Living with Beauty: Promoting health, well-being and sustainable growth. The Building Better, Building Beautiful Commission. January 2020. Living with Beauty: Promoting health, well-being and sustainable growth. The Building Better, Building Beautiful Commission. January 2020. Local Government Association (2019). Attracting investment for local infrastructure — a guide for councils. Local Government Association (2019). Attracting investment for local infrastructure — a guide for councils.
A stewardship approach to creating communities
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Local Government Association (2019). Attracting investment for local infrastructure — a guide for councils. Local Development Orders (LDOs) are locally focussed planning tools that LPAs can use to grant planning permission for specific types of development within a defined geographical area. They are designed to help streamline the planning process by removing the need for developers to make a planning application.
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