Many public-sector organisations tend to focus on the short term when developing property asset strategies. Increasing financial pressure forces them to prioritise a quick sale or lease at market rates over the long-term social and economic value these assets could generate. Yet maximising public asset value can be a vital part of the post-Covid recovery.
As part of Future of London’s Learning from Crisis programme, we invited cross-sector leaders and frontline practitioners to explore how we can overcome barriers, share good practice, and discuss what is needed to create better use of public assets.
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Key takeaways from the webinar
- Revenue and social impact are not mutually exclusive.
- We can help local authorities build their confidence to innovate, taking a more flexible and creative approach to their property portfolio, through sharing experience, successful case studies and route maps.
- We must ensure that long-term social and economic value is understood, built into asset strategies and policies and this ambition is communicated to developers and operators through clear guidance.
- Co-design will boost the economic and social value generated by communities and help combat gentrification.
For the webinar we were joined by
- Rokhsana Fiaz, Mayor of Newham
- Daniel Partridge, Director of Ventures and Strategy, PRD
- Binki Taylor, Partner, The Brixton Project
- Jacob Loftus, Founder and CEO, General Projects
- Louise Duggan, North West Area Manager, Greater London Authority
Watch the creating better use of public assets video here
Having clear direction and strategy
Property can be a vital tool for local authorities in Covid recovery. As Binki pointed out “local economy is now a well-being issue.” Rokhsana made the case that to maximise the potential for economic and social value from council owned (and commercial) assets a clear long term vision is vital. This should set out how the council’s overall ambitions can be realised through property and the metrics for measuring success, from employment, culture, environment to health and wellbeing. Daniel emphasised the need for a structured and rational process to assess the opportunities within a portfolio and make sure investment is going into the most appropriate buildings -“the unpolished gems.”
A new model for commercial assets
Developers and operators also need clarity when delivering projects on previously council-owned assets so that they can align investment with local need. Although the property industry has a bad reputation admits Jacob he thinks there is an entirely new business model emerging. One that is responding to societal pressure to address sustainability, to engage not alienate communities, and move away from the traditional “tug of war between profit and purpose”. Harry Owen-Jones, Director at Redo agrees “this can be avoided with appropriate value measures that consider both profits and inclusive socio-economic outcomes”.
Jacob shared his experience of Expressway in Newham where businesses place huge value in activities such as apprenticeships and partnerships with schools. These foster a close community within the building, strong links with the local supply chain and in many cases lead to tenants staying far longer than originally intended.
All speakers agreed that empowering local people with a sense of ownership towards assets was key to maximising the potential for social value. Alex Russell, Executive Chair of the Hackney Wick and Fish Island Development Trust, explained that communities can be more “agile and nimble” in responding to changing neighbourhood need, plan for the longer term, be more financially stable and deliver more if they own the building they’re in.
The creative and social enterprises in Hackney’s Fish Island brought vibrancy to the area, making it attractive to property developers. However, the community had little say in development, creating local instability. Alex believes ownership would enable people to feel part of the journey of change, instead of being the ones that “change is being done to.”
Drawing on her experience at International House, London’s largest affordable workspace in Brixton, Binki explained the importance of the building to facilitate “the community working on Brixton together.” This provides significant benefit both to the council in helping fulfil their community and economic strategies and to empower the community to achieve more through collaboration. Re-using existing buildings like International House is not only more sustainable but can also avoid gentrification. The approach of ‘gentle refurbishment’ with the tenants has created a very clear sense ownership and identity.
Behavioural and cultural change
The panel agreed there is a growing trend in authorities taking this longer-term, social-value-driven approach to their property portfolio. To accelerate this behaviour, a culture change in local authorities is needed. For Binki, there is a “level of fear and caution” within councils that stops them thinking expansively. Rokhsana recognised the importance of supporting staff to be more creative in order to deliver Newham’s innovative community wealth building agenda. To empower officers to take risks requires a more holistic approach whereby council officers work outside of their traditional roles with community stakeholders.
Louise drew on the example of LB Sutton who used their assets strategy to start on a number of individual sites including Sound Lounge and Sutton Works. Growing confidence in this new approach has led to the council accessing substantial funding including £11.3m from the Future High Streets Fund.
The one thing needed to move this agenda forward
Daniel: each local authority should pick 10 assets in their portfolio and come up with a cohesive plan.
Binki: with the above 10 assets idea in mind, work with the local community to agree how these assets should be used and to kickstart a co-production process.
Louise: to build on community engagement, add a clear definition of social investment and return.
Jacob: encourage local authorities to set out clear guidelines for developers to understand the key local authority priorities and approaches in the long term (10-15 years).
Rokhsana: use assets in collaborative and co-designed way, working with communities and young people on projects to develop innovation and a vision that others can learn from.
Harry: establish a structure to group existing assets together as a portfolio and identify the different values these assets can generate for local people.
Alex: investment by councils is needed to ensure those who are taking on assets have the right skills to develop and work with them.
Councils are facing increasing pressure to plug the funding gap but this new approach to using assets to generate social and economic value is gaining traction across the capital. We will soon be releasing a summary report that sets out the steps to move this agenda forward, drawing on best practice from London and beyond.
For further insight, catch our ‘Creative use of public assets’ podcast – part of the #LearningFromCrisis ‘Connections’ series. Find out more about FoL’s Covid-19 programme – Learning from Crisis – here.