HCA - Public Sector Land &
Development
Jason Essenhigh
1 October 2012
Scope of presentation
 The HCA’s role
 Land asset ‘family tree’
 Our assets and their value
 Market challenges
The HCA role
We are the people who help get things done…
 Working with people and places to enable
them to deliver homes, economic growth and
jobs
 Delivering programmes of investment
 Making best use of our land and that of
government/ other public bodies
 Undertaking robust economic regulation of
social housing providers
HCA Purpose: to contribute to economic growth by helping communities to realise their aspirations for
prosperity and to deliver quality housing that people can afford
Current delivery context

Limited public funding

Localism

HCA investment is focused on 4 key areas:

•
Affordable housing
•
Renewal of existing social housing stock
•
Land and regeneration
•
Economic Assets Programme
Focus on growth
Example of HCA’s enabling role:
HCA’s Advisory Team for Large (planning) Applications =
Our investment role:
Land and regeneration
 HCA land development and disposal plan
will deliver 11,000 new homes by 2015
 Wider use of “Build Now, Pay Later”
deferred land payment
 Making best use of HCA / other public land
 Economic Assets Programme working with
LAs to secure local economic development
“We play a key role in Governments ambition to make the best use of public land to
benefit communities”
Our role in land
HCA Land
 Existing P&R commitments
 Accelerated disposal of land
Other government land
 Technical support to government
departments
Economic Assets Programme
 Over 300 sites transferred – value of
£300m
 Nationally important sites – Enterprise
Zones
 Local stewardship arrangements
Our role: Delivering local priorities
 Investment has to be aligned
with local priorities
Land
 HCA assists local delivery with
the right mix of:
– HCA and other public land assets
– Affordable housing / regeneration
investment
– Enabling support and tools
– Aligning public funding streams
Regeneration and
affordable
housing
Delivery of
local priorities
Enabling
support
and tools
Aligning
public funding
“We are locally driven. We work with councils, LEPs and other local partners, effectively
targeting our investment and support at their identified priorities.”
HCA best value for our land = a balancing act:
• National policy (e.g. accelerated land sales).
• HM Treasury requirements (get “hard cash”).
• Impact of other Departmental / Section initiatives.
• Demonstrating best value for taxpayers.
• HCA’s corporate and business plans (which
includes the provision of affordable housing).
Versus
• Local(ism) agenda – the aspiration / expectation
of the local community and their elected leaders.
• Providing best-outcome for the council tax payer.
• Build viability / land demand / constraints.
 The HCA’s role
 Land asset ‘family tree’
 Our assets and their value
 Market challenges
Industrial Estates Management
Corporation
CNT
English Industrial Estates
Corporation
(English Estates)
Development
Corporations
CNT / DC
landholdings
Urban Regeneration Agency
(English Partnerships)
EP strategic
sites
£
Coalfields
Surplus PSL
MoD/NHS/AEA
?
HCA
RDA / LDA
RDA / LDA
sites
HATs
GLA
MK sites
 The HCA’s role
 Land asset ‘family tree’
 Our assets and their
value
 Market challenges
1.
IFRS International Accounting Standards
2.
HM Treasury FReM
3.
RICS Valuation – Professional Standards
4.
HCA normative model
Government Financial Reporting Manual (FReM):
“….how best to apply the valuation requirements so
as to ensure that the statement of financial position
gives a true and fair view of the value of the assets at
the reporting period”.
HCA AVE 2012
Total number of
valuations undertaken
1,891
Number of assets valued
at less than £100k
1,137
RDA DATA
NUMBER OF
ASSETS
East South
East
Midlands
North West
NE,Y.H
South/South
West
57
53
44
100
60
Former RDA Commercial
Premises (illustrative only)
Number
East South
East
10
Midlands
17
North West
30
NE,Y.H
South/South
West
47
41
HCA Landholdings
9,243 hectares in total
(92.43 sq km / 22,840 acres or 35.7 sq miles)
Most valuable asset
37 hectares (prime MK development land)
Largest single asset
289.6 hectares (Northstowe, South Cambs - housing)
Huge number of small land strips e.g. nil-ransom verge
 The HCA’s role
 Land asset ‘family tree’
 Our assets and their value
 Market challenges…….
…….and opportunities to
get best consideration?
Acknowledged © PwC - July 2012
Acknowledged © PwC – July 2012
Challenges & Opportunities (PwC Review July 2012)
Challenging market conditions:
Low levels of activity in the housing market.
Ensuring enough houses are built in the right places
to satisfy demand.
Restricted access to credit particularly for first time
buyers.
Coping with increasing demand for affordable rental
properties.
Inter- and intra-generational inequality.
Opportunities
• Preparing for medium-term growth opportunities.
• Strategic investment in high home-demand areas.
• Using momentum behind planning reform to
respond to market signals.
• Increasing demand for products that provide equity
finance for house purchase.
• Policy to make investment in rental a more
attractive prospect.
• Using large scale regeneration schemes as an
opportunity for investment in rental housing.
• Use housing wealth to address fiscal sustainability
problems resulting from an aging population and
respond to the challenge of funding long-term care.
• Expanding shared equity models to enable those
without wealthy relatives get on the housing ladder.
Tools in the HCA’s box
Stalled sites:
• Grants (Kickstart / Get Britain Building).
• Reduce or delay onerous / costly planning.
conditions or community benefits.
• Change land payment (build now and pay later).
Unsold sites:
Higher cost - site de-risking
• Eliminate or mitigate abnormals / contaminants.
• Forward-fund utilities / roads / community buildings.
• Forward-fund new / renegotiated obligations / S106.
Lower cost - site de-risking
• Obtain planning consent or lock-in existing
favourable consent by undertaking qualifying works.
• Build now and pay later for the land.
Savills data – Midlands 2012
Acknowledged © Savills 2012