The Challenges Facing Local Authority Regeneration
The challenges facing Local Authority Regeneration and how Pulse helped the London Borough of Southwark overcome them with the £290m regeneration of the Tustin Estate.
Similar to all Local Authorities, London Borough of Southwark (LBS) faced several challenges with regenerating the Tustin Estate.
Primarily limited capital balanced against a political back drop to deliver much needed affordable homes. Below we have outlined how Pulse supported LBS to lead them from a Stage two design into contract with a developer and onto site in just 12 months.
THE CHALLENGE
1. Limited funding
Regeneration projects can be expensive, and local authorities often have limited funding to support them. This can lead to delays or a lack of progress in implementing the regeneration project.
OVERCOMING THE CHALLENGE
Pulse carried out an evaluation of the routes to market that could support LBS regeneration requirements. Following an appraisal of the options to engage private developers, we recommended the Pagabo Developer framework. A competitive tender process followed in which Linkcity were appointed. Following an intense period of negotiation, including weekly legal and financial meetings, we were able to recommend to Cabinet a phased approach to development which prioritised the affordable housing, whilst giving the site sufficient future returns for Linkcity to generate a land receipt for LBS.
This approach minimised LBS capital expenditure over a 10 year framework, gave certainty to the delivery of affordable homes and generated a land receipt.
THE CHALLENGE
2. Community Resistance
Regeneration projects often involve changes to existing communities, and some residents may resist these changes due to concerns about displacement, loss of community character, or other reasons. This can lead to delays or even the cancellation of the regeneration project.
OVERCOMING THE CHALLENGE
LBS took a proactive approach to community engagement, going over and above the GLA guidelines on balloting local residences to vote on regeneration plans. Over the course of a number of months, regular resident engagement activities meant that when it came to the resident votes, there was considerable support for the scheme .
It was important this good work wasn’t compromised, Pulse with LBS set out a stakeholder plan which included weekly resident meetings. We also ensured that residents had a voice in the selection of the developer and a resident group was formed that helped to set the tender questionnaire, evaluate them and were part of the interview team. This buy-in was important to LBS to ensure residents continued to be heard. Now on site, Pulse takes a group of residents on a weekly walk round, in addition we have committed significant social value to the local community by sponsoring a local girls’ football team, hosting a pitch at local resident days as well as running skills workshops, our favourite though is running belly dancing lessons in the local community hall!
THE CHALLENGE
3. Planning & Zoning Restrictions
Local authorities may face planning and zoning restrictions that can limit the scope of regeneration projects. These restrictions can include limitations on building heights, restrictions on land use, or other regulations that may make it difficult to implement certain aspects of the regeneration project.
OVERCOMING THE CHALLENGE
There were a number of stakeholders to the planning process. By following the approach laid out by the GLA ballot the scheme had local support, this included residents and politicians. Over the course of 12 months, part of the stakeholder management plan was pre-application planning meetings with both LBS planners and with the GLA. This process meant that all stakeholders had a voice and were heard. The result of this level of engagement meant that the planning application was determined within 12 weeks.
As well as overcoming the planning, we had to protect the commerciality of the development. Phase one received detailed planning consent, whilst the remaining of the phases secured an outline consent. The outline consent forms the basis of the developers appraisal, meaning that they have confidence in future phase delivery. An important step in generating a land receipt for LBS. Our programme ensured that the developer was appointed early enough in the design process that they could influence the outline planning consent.
THE CHALLENGE
4. Economic Factors
Regeneration projects may be impacted by economic factors, such as changes in the real estate market or the availability of financing. If the economic climate is unfavourable, it can make it difficult to secure funding or attract investment in the regeneration project.
OVERCOMING THE CHALLENGE
Like most regeneration projects, the Tustin estate is not prime real estate. Early in the project we set out a strategy that could give potential investors confidence in the value of future opportunity. To give confidence we needed to make sure a developer was involved in the master planning and that the massing of future phases was sufficient to drive value. We achieved this goal by procuring earlier, by finding a route to market that gave LBS sufficient confidence in the right type of developers being interested and by setting out a programme that ensured both current day value (from contracting arm) as well as future value from private development. All of this was balanced with a plan and engagement that gave assurances on grant, planning and programme.
Inevitably there were some practical challenges to overcome. We had to run several work streams side by side, this meant that all parties had to be well resourced, it also meant that LBS had to engage in a risk profile that some local authorities would have felt uncomfortable with. The result was phenomenal, from all parties there was a well-resourced team that worked collaboratively to drive the programme and deliver outcomes that all could be proud of.
In Summary:
Overall, local authority regeneration projects require careful planning, coordination, and community engagement to overcome these challenges and achieve their goals. Tustin is a remarkable example of what can be achieved by running work streams side by side, by having a well developed programme and stakeholder engagement plan and by having a local authority that was driven to ensure local residents and communities got a much needed regeneration, that they could influence.
“Pulse played a critical role in propelling the Tustin Estate regeneration project forward. They skilfully managed multiple work streams at the same time, ensuring that the programme's pace was sustained.
From the outset, they understood the Council's needs and assembled a seasoned team to assist with the project's execution. I wholeheartedly recommend them for any regeneration schemes.”
Neil Kirby, Head of Regeneration South, London Borough of Southwark
