It was great
to read that Manchester City Council (“MCC”) had taken a different slant on
funding to set about their ambitions. It is no surprise that the residential
market in the North West is having an impact on the regional economy, with
housing shortages across the region. A conversation with a housing developer
only three weeks ago identified that only about 60% of houses needed in the
area are being built – quite a short fall.
So the plan
by MCC is to build 6,000 new homes by 2024 and to kick start this investment
they are teaming up with Sheikh Mansour in a joint venture and already 830
homes have been announced. Now the partner is no surprise and some of the
redevelopment fits well with the overall development work undertaken in the
city. Which begs the question, it’s a
nice idea but could it be replicated elsewhere in the regions? For me it
won’t do except for certain areas as the challenge will always be finding that
joint venture partner. A partner needs something that really does benefit them
– why not partner with a commercial developer, by completing the residential
development it could unlock future potential from a commercial angle.
It is fairly
unanimous that the private sector doesn’t deliver enough housing. But it’s not
their fault, they have shareholders to answer to, imagine having to tell them
that you’d lost their money but don’t worry there is no longer housing issues,
unlikely! So partnering with a Sheikh may be ambitious for all and pushing the
private won’t work – so why not partner with say the Homes and Communities
Agency (as MCC has already!) or a more wide spread multi party joint venture to
share the risk and benefit.
It all comes
full swing with the panic in the political parties about housing and they
certainly are all scrambling to outline their plans, none of which ultimately
convince me but they are a huge step forward. For the Conservatives, it is a
focus on extending “help to buy” and tax exemptions for discounted houses to
certain individuals. They sound better than Mansion Taxes and forced
development (surely you have a land bank for the very description, a bank of
land for the future. So I leave you with two questions – which proposed plans
make you jump with excitement and which makes you weep in the corner?
Feel free to contact me 0113 288 2276 or lee.a.wilkinson@uk.pwc.com if you wish to discuss this blog or anything relevant to
property and construction.
Enjoy the weekend which is nearly with us,
Lee
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