
The Edinburgh Region has recently signed a City Deal
that has sadly missed the mark when it comes to Placemaking. With
just one significant capital investment, targeted in Winchburgh to
deliver an additional 3000 homes, there is a long way to go if we
are to meet the target of 65,000 new homes in the Region. The time
has surely come for us to recognise that it will take a whole
market approach and require proper integration of infrastructure
investment with a new debate on sharing risk between the public and
private sectors.
One significant change in the house building sector over the
last ten years since the financial crash in Scotland has been the
rise in prominence of a smaller number of big players. With funding
from new sources a small number of cash rich house builders have
been smart with their investments and very focussed on risk and
profit. They have been working hard to rethink their approach to
sites to ensure that they get the right balance between supply and
demand. Five years ago there was a focus on sites of 100-150 units
and now it is in the region of 250-350. This approach has made it
even more challenging for the City Region to deliver its
Placemaking ambition and build momentum in terms of new public
infrastructure. The current success of this strategy is reflected
in land values that are limiting the opportunities for the delivery
of affordable housing, whether for market sale, mid or social
rent.
Whilst the house building sector, by necessity, has adapted and
evolved, the delivery of affordable housing has continued to follow
the same path. The number of active developing associations and
local authorities has increased significantly as a factor of
increased grant funding and historically low interest rates.
However, due to the nature of land costs and the shape of the wider
housing market, opportunities in the most pressured areas are often
controlled by the house builders and there is significantly more
capacity to deliver than is being realised.
The chink of light in the City Deal for the delivery of a
Placemaking approach is the open door for Local Authorities to use
their borrowing powers to intervene in the market. In Winchburgh
this will be for the front funding of new schools and roads and in
Edinburgh for the creation of a new Housing Company. There are at
least a half dozen strategic sites in the City Region that should
be the catalyst for the creation of new vibrant places to live that
could come together if these new borrowing powers were combined
with the capacity of the affordable housing sector. Collectively,
the Region could shift the balance of control from house builders
to Placemakers. To achieve this we will have to collectively take
different risks, recognise the market value of land and take some
brave political decisions, sharing control of the outcomes. The
good new is that unlike many of the difficult political decisions
facing Local Authorities and Central Government this presents an
opportunity for genuine partnership that shares risk to deliver a
shared outcome and belief in Placemaking.
If we do not adapt to the new market conditions more quickly
then we risk losing out on the opportunities presented by a growing
economy and low costs of borrowing. The Housbuilders have shown us
how to be successful in delivering housing, we need to learn and do
it even better ourselves.