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DELIVERING SUSTAINABLE URBANISM
SLIM
2
3
FOREWORD
NATURAL
CAPITAL
SOCIAL
CAPITAL
FINANCIAL
CAPITAL BU
ILT
CAPITAL
COMMUNITYC A P I T A L
4
VALUING SUSTAINABLE URBANISM9.6
4
6.6
3
6.6
0
AYLESBURYU R B A N I S M
DORCHESTERU R B A N I S M
GLASGOWU R B A N I S M
7.0
7
5.9
7 7.5
1
8.0
3
6.1
9
7.9
6
5.4
1
2.2
8
2.3
7
AYLESBURYU R B A N I S M
DORCHESTERU R B A N I S M
GLASGOWU R B A N I S M
3.1
9
2.0
9 3.6
3
4.0
1
2.1
7
3.9
4
Residual Revenue per Hectare of Built Land(Value £m)
Total Market Value of Buildings per Hectareof Built Residential Land
(Value £m)
10
8
6
4
2
0
10
8
6
4
2
0
Values are based on publically
available data sources.
STANDARDURBANISM
SUSTAINABLEURBANISM
OLDURBANISM
Values are based on publically
available data sources.
STANDARDURBANISM
SUSTAINABLEURBANISM
OLDURBANISM
5
THE CHALLENGE OF DELIVERING SUSTAINABLE URBANISM
9.6
4
6.6
3
6.6
0
AYLESBURYU R B A N I S M
DORCHESTERU R B A N I S M
GLASGOWU R B A N I S M
7.0
7
5.9
7 7.5
1
8.0
3
6.1
9
7.9
6
5.4
1
2.2
8
2.3
7
AYLESBURYU R B A N I S M
DORCHESTERU R B A N I S M
GLASGOWU R B A N I S M
3.1
9
2.0
9 3.6
3
4.0
1
2.1
7
3.9
4
Residual Revenue per Hectare of Built Land(Value £m)
Total Market Value of Buildings per Hectareof Built Residential Land
(Value £m)
10
8
6
4
2
0
10
8
6
4
2
0
Values are based on publically
available data sources.
STANDARDURBANISM
SUSTAINABLEURBANISM
OLDURBANISM
Values are based on publically
available data sources.
STANDARDURBANISM
SUSTAINABLEURBANISM
OLDURBANISM
6
NEW APPROACHES TO RESIDENTIAL DELIVERY
Housebuilders face
tremendous uncertainty and are
unlikely to get the margins they
want, particularly on large
strategic projects. Landowners
and property investors may need to
adopt a longer profit horizon.
7
8
A NEW RESIDENTIAL GROWTH MODEL
9
THE REQUIRED SKILLS
It will be attractive to some investors
to have receipts over 5 to 20 years backed by
real estate assets, with the potential to add value
over and above the market through active man-
agement. This could help move the UK away from
a situation where infrastructure must be funded
through taxation to a public-private partnership
that co-invests in infrastructure.
10
Land Owner
ROLE
equalized basis where land is
in multiple ownerships)
MOTIVATIONS
income from property until
land is required
value uplift
cash is required
premium rewards patience
Investor
ROLE
design, land preparation and
infrastructure
MOTIVATIONS
participation removes risk
through
sustainable urbanism premium
be used to diversify portfolios
Promoter
ROLE
money to take project
through planning permission
MOTIVATIONS
-
uplift from beginning to
post-planning permission
schemes simultaneously,
mitigating risk, capitalizing
on expertise
PHASE 1
PHASE 2
PHASE 3
PHASE 4
PHASE 5
Land Investment Vehicle
Promoter
Land Promotion Vehicle
Land Owner
Relationship of Participating Interests
PLANNING AND PROM0TION PHASE
A STRATEGIC LAND INVESTMENT MODEL, OR SLIM
Investor
Upon acquiring planning permission land
is transferred into a separate investment
vehicle, and capital is introduced to fund
further scheme development including a
design code, infrastructure, and project
management.
Landowner and promoter enter into
partnership to create a master plan,
gain planning permission, and to
promote the land, supported by
investment equity looking for returns
commensurate with risk and timeframe
INFRASTRUCTURE PHASE
Ongoing Land Management Vehicle
11
CONCLUSION
RISK
RETURN
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
120
100
80
60
40
20
0
20
PROMOTERCOSTS
LAND OWNERCOSTS
INVESTORCOSTS
REVENUETO PARTNERS
PLANNING PHASE INFRASTRUCTURE PHASE
INFRASTRUCTURE COSTSPLANNINNG AND
PROMOTION COSTS
£m
Cash Flow Profile of a Typical Project
Phases 2,3,4 and 5 also see a value uplift
due to the sale od previous phase
