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National Planning Forum
The Major Developers Group
• Roger Madelin (Argent Group)
• Malcolm Kerr (Dp9)
• Stephen Musgrave (Hines)
• Liz Peace (BPF)
• Hugh Bullock (Gerald Eve)
• Mike Hussey (Land Securities)
• Adrian Penfold (British Land)
• Toby Courtauld (Great Portland Estates)
• David Watkins (Linklaters)
• Stuart Lipton (Chelsfield)
• John Irvine (Grosvenor Estates)
• Mike Gallimore (Lovells)
• Peter Rees (City of London)
• Peter Cole (Hammerson)
• Nick Shattock (Quintain)
• Peter Bishop (Design for London)
• Patrick Robinson (Herbert Smith)
• John Rhodes (RPS)
• John Walker (Westminster City Council)
Introduction
The Major Developers Group –
Commercial and residential
development.
Group includes town planning
surveyors and lawyers and planning
directors.
Working with - LGA, London
Councils, Planning Officers Society,
HBF, BPF, CBI, London First.
2
UK Economy
Enters
Recession
YoY%
5.0
4.3
3.8
4.0
2.9 2.8 3.1
3.0
2.3
2.0
1.0
3.4
3.3
3.0
2.9 3.1
2.8
2.4
2.1
2.2 2.2
1.8
1.3
1.0
0.8
0.2
0.0
-1.0
-1.4
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
-2.0
-0.8
Source: Experian; Jones Lang LaSalle
3
Job Numbers
Falling
6.0
4.0
%
2.0
0.0
-4.0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
-2.0
Total FTE Employ ment
FBS Employ ment
Source: Experian; Jones Lang LaSalle
4
Yields to rise
further
Equiv alent Yield
%
Retail
Industrials
Office
14.0
12.0
10.0
8.0
6.0
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
4.0
Source: IPD; Jones Lang LaSalle
5
…and Capital
Values to
Decline
Retail
Office
Industrial
20
10
%
0
-10
-30
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
-20
Source: IPD; Jones Lang LaSalle
6
Recession
•
•
•
•
•
•
Unprecedented decline in values
No new starts in commercial
Housing 30,000/50,000 units???
No bank or housing finance
Share prices halved at best
No understanding yet of when the
market will bottom out or finance
will be available
• Inflation has taken us out of
problems for years, deflation will
highlight them
7
Planning
• Planning process needs change from
adversarial to cooperative
• Need joined up approach with
Government and Local Authorities
• Killian Pretty Review helpful
• Free up the system – 60 years, 944
documents, 800 pages of policy
• More understanding from developers
and more planning personnel required
• Bring certainty to CIL and 106s
• Major Developers Group experience is
that 80% of organisations involved
agree the criteria required
8
Construction
• No more wow factor wiggly wobbly
architecture with strange shapes
• Austerity in the past produced
ingenious designs
• Building inventiveness to move from
Roman style to the modern era of
construction with functionality driving
productivity based on high quality
engineering solutions
• Less red tape, proper time to plan
building construction rather than last
minute
• Less waste, better design, more
efficient construction logistics and
value engineering = 30% cost saving
9
Commercial
• Better product at lower cost
• Cost pressures/quality of life issues
likely to direct more building to
regional hubs
• Transport infrastructure and
development coordinated to reduce
costs and travel – people working in
clusters with no more urban deserts
• Village Green with civic and mixed
use buildings
10
Process
• More competition to improve quality
• Increased civic pride to drive social
and economic change
• Maintain housing construction
capacity and experience
• Sustainability through innovation
not just rules but a system to
encourage new ideas
11
Housing
• Need to have housing land surplus
not deficit to avoid recurrence of
overpriced land
• Put earnings into GDP not land
• Certainty of housing
– Guaranteed delivery
– Wider market supply
(commercial developers,
innovators, as well as house
builders)
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Conclusion
• Government will need to finance
infrastructure projects and maintain
the housing supply chain
• Partnership between Local
Authorities and developers needed
to improve quality and reduce cost
of process
• Innovation required to produce
better product at lower cost
13