There are obviously difficult times ahead, but the launch of the HCA brings with it an opportunity for the regeneration sector to evolve
Well, what do I say to people who ask me if can see any chinks of light for the regeneration industry in all this mayhem? Which way will things go? As Dr Seuss put it in the closing line of his opus The Cat in the Hat: “Well, what would YOU say if your mother asked YOU?”
You have to accept that things are on the ropes when property agents devise a splendid new business line in real estate consultancy – that of renegotiating existing section 106 agreements based on revised viability appraisals (the lads doing this remind me of those old girls who used to sit around knitting at the guillotine).
The underlying story is that we are now on an entirely new track for urban regeneration in this country. We will come through these troubled times with a very different financial system from the one we had at the outset.
Let’s hope also that there will be a number of new developers that evolve to meet the changing nature of the market – ones that will respond to the need to reduce risk in projects by using public sector assets.
I am not alone in being greatly encouraged by the emerging Homes and Communities Agency (HCA). It has shown great resolve in truncating its start-up period and in appointing a luminous senior team. With £16bn in funding, it is clearly well placed to support public sector agencies in bringing opportunities to market – even in these sorry times.
Developers who can respond, not just on ability to deliver but on a range of social objectives, stand to become “partners of choice”. I take comfort from the growing understanding that the Official Journal tendering process is prohibitively expensive, creating a barrier to entry for many decent emerging developers who wish to do the right thing by their communities. The HCA is, instead, moving towards a process whereby partners can make use of a pre-qualification process; those who show a track record could become trusted delivery partners.
The old self-styled mixed-use developments (blocks of pedestrian flats with void ground floors) now littering our conurbations are the UK property industry’s equivalent of the sub-prime mortgage market. We urgently need a new paradigm. The only thing that is clear is that we cannot go on as we were.
Jackie Sadek is head of regeneration at CB Richard Ellis and chair of BURA