Inside Housing's Joint Venture Developments 2015: Exemplary Private-public Investments In New Homes

By Author: Bradley Weiss
Total Articles: 272
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Cooperation is the key to building much-needed new residences in the UK. Most of these developments are a mix of market rate and affordable homes.



In a complex world, the most likely way to succeed at anything is to engage multiple parties working toward a singular goal. In a business and development context this is called a joint venture. And perhaps where it comes to meaningfully increasing the supply of housing in the UK, joint ventures between local councils, developers, investors, housing associations and others are increasingly important.



Participants in land investment funds understand this. They apply capital and know-how to identify land where homes might be built. They work with local planning authorities and existing communities to identify how new homes and new residences can enhance a local economy, bring new investment, as well as increasing and often modernising the local infrastructure. ...
... They also very often work with homebuilders, selling plots of land for those firms to build on as they see fit. Each works together to the common goal of increasing land values and helping communities improve and expand their housing stock.



InsideHousing.co.uk published descriptions of exemplary housing projects in its annual showcase titled: “Top 60: Joint Venture Developments of the Year. In this category, the five finalists were selected for bringing creative solutions, “ones which bring organisations together to capitalise on their relative strengths and which allow partners to achieve more together than is possible alone,” according to the magazine’s editor.



Cumulatively, the following five joint venture developments added 6,295 homes to the nation’s inventory in that vein:



Laurieston Living (Glasgow) - With up to 1,000 homes in total, the second phase of this project delivered 69 homes for sale at market prices and 39 in the mid-market rent range. Artwork used throughout the site is a collaboration of an established artist working with young local artists in a mentorship programme. The joint partnership includes Glasgow City Council, a housing association, the Scottish Government and Urban Union, which is a joint venture of two construction companies.



Northfield Village Phase 1 (Birmingham) - The end result is an aging-in-place apartment building with 80 residences, a women’s refuge, a specialised care facility for people with dementia, plus nine affordable-rent homes for “people with a local connection,” plus a commercial section that includes a café, restaurant, bar, shops and an occupational health accommodation. The joint venture partners were the National Health Service, the Wrekin Housing Trust and the local council housing authorities. This project ultimately won top honors for its category, in part because a “community hub” that brings residents together with the wider community is believed to create a healthier, more socially integrated community overall. The building and landscape scheme were also judged to be attractive and well designed.



Sheffield Housing Company (South Yorkshire) - Sheffield City Council has partnered with private developers Great Places Housing Group with financing from Keepmoat, with the ambitious goal of adding 2,300 homes in the next 15 years. Of 293 homes built thus far, 70 are available at affordable rent and 223 are for market sale. Of note: the participating partners in this £295 million first-phase development will share in its profits.



Evolution Gateshead (Tyne and Wear) - The Gateshead Regeneration Partnership - Gateshead Council, Home Group and Galliford Try Partnerships North East, one of the UK’s leading house building and construction groups - plan to develop 2,400 new homes on 19 sites over 15 years. Of the first 318 homes built, 37 are affordable rent, 18 shared ownership and the remainder offered at market rates.



While many investors think all the action in development is in London and the South East, this North East development shows that UK land investment are wise to look elsewhere. Enterprise zones are established in the region, which promote low carbon vehicle development, marine offshore and subsea engineering, petrochemicals and renewable energy. Gateshead College has the Future Technology Centre, which invests in research and development to create new products, learning experiences and sustainable employment.



243 Ealing Road (London) - Housebuilder Hill entered a joint venture with Network Living to construct 441 homes for £110 million on a canalside site (a brownfield tract that formerly served as a warehouse). 254 of the homes were offered for outright sale, with the remainder in shared ownership, shared equity, Rent to Buy, and affordable rent. According to the editors, the partnership devised a clever strategy: “off-plan sales allowed the partners to speed up the construction programme to meet demand 18 months ahead of schedule.”



In each project, the sum of the total is arguably greater than its parts - councils, charities and builders worked with disused land or derelict structures to find a way to make the investments from each worthwhile and productive.



It’s never possible to know how an investment will return growth (or not) on assets. But a smart investor will always engage an independent financial advisor to help guide them through the many options - determining which pose the best risk-reward scenarios relative to the investor’s full portfolio.