Wolfson Economics Prize 2014 - Wei Yang & Partners and Peter Freeman join forces to make Second Stage Submission
28 Aug 2014
Following their selection as finalists for the Wolfson Economics Prize 2014, Wei Yang & Partners (with Buro Happold consulting engineers) joined forces with Peter Freeman, joint founder of property developers Argent. Peter’s entry was “Highly Commended” in the first round. The team was also strengthened with economic development advice from Lee Shostak, Chairman of Shared Intelligence, and cost planning advice from Gardiner & Theobald.
Today, the Second Stage Submissions will be published on line by the organisers of the Wolfson Economics Prize 2014. The submission from Wei Yang & Partners and Peter Freeman argues that:
Location and scale
- Local Authorities must lead the efforts to accommodate population and housing growth.
- Garden Cities can contribute to the UK’s competitive economic advantage so they must be located in areas where housing pressures are intense and where there is a realistic prospect of significant economic growth.
- An “Arc of Opportunity” stretching from Southampton, through Oxford and Cambridge, to Felixstowe, some 40-80 miles from London, is the best location for the first round of Garden Cities.
The submission uses a model of 10,000 homes (25,000 people) and 10,000 jobs to test a strategy for perhaps 30 to 40 Garden Cities, each to be built over 10-15 years. 30% of new homes would be affordable. The actual size will depend on how the Garden City would contribute to strengthening local networks; some could be smaller, many could be significantly larger but at 10,000 dwellings the Garden City could be developed by a single Local Authority using existing legislation. The combination of Local Authority control and use of existing legislation means that new homes and jobs could be delivered quickly.
Design and sustainability
The Garden City would be founded on four structuring principles:
- Walkable Neighbourhoods with a radius of around 500m
- a strong Town Centre and Neighbourhood Centres
- a permeable street network
- a generous and multi-functional network of parks, gardens, open spaces, woodlands, lakes and streams.
The Town Centre would be a lively, bustling, busy place, achieved through the mix of land uses and efficient management of the retail floorspace. The Garden City would re-create the complexity of conventional towns and cities, where land uses have developed organically; this integrated, looser, messier mix makes the street scene vital. It can be achieved through a combination of good master planning, which encourages diversity and activity, and effective management of the Garden City Estate. Well-designed and managed places create vitality, foster economic activity and extend the period over which a Town Centre is used.
Some 5-7,000 people would live in each Walkable Neighbourhood within walking distance of key local services around a village green; a primary school, shops, restaurants, health and educational services – all readily accessible by bus.
The combination of these place-making principles, overlain with new engineering technologies, would enable residents to live sustainable, low carbon, resource efficient and healthy lives. Building a new community from scratch provides considerable flexibility in the way that the way the community can be planned with services, utilities and systems provided when they are needed.
Delivery and finance
In terms of delivery, the submission proposes a practical, realistic strategy that will deliver new homes and jobs quickly. It is designed to overcome all the existing impediments that are preventing a resurgence in house building and consequently stoking a housing price bubble. Key features are:
- It invites Local Authorities to ask Government to establish a locally-controlled Garden City Development Corporation, with CPO powers and planning powers, using the existing New Towns Act 1981.
- The Development Corporation would select a Master Developer funded by pension funds and/or other institutional investors.
- Together the Development Corporation and the Master developer would establish a Joint Venture Delivery Vehicle.
- The Development Corporation could acquire land through CPOs at Current Use Value but the financial appraisal makes provision for acquiring land at substantially higher land values to encourage participation by landowners without the need for CPOs.
- Institutional investors would provide “project finance” for the Joint Venture Delivery Vehicle. Receipts from the disposal of land for new private housing would meet all of the costs of land acquisition, compensation for loss of amenity, infrastructure, community assets, etc. Land for affordable housing would be provided at no cost.
- All community assets including open spaces, and the shops in the High Street and Neighbourhood Centres would be vested in a Community Land Trust.
- Applying the assumptions of the baseline financial viability model, the Joint Venture Delivery Vehicle would earn an Internal Rate of Return of nearly 12.5% over 15 years or an absolute return of £162m, making it an attractive investment proposition.
- These financial returns would be available for sharing amongst the Master Developer (and their institutional investor), the Local Authorities, the land owners, the Community Land Trust and Government. In areas of higher values the surpluses to share could be enormous.
Benefits for Local People
Existing and new communities would enjoy substantial benefits:
- Locally-based decision-making.
- Compensation for loss of amenity and disturbance from construction; purchase of homes from those who wish to sell.
- Preferential access to affordable housing and amenities, entitlement to other incentives.
- High quality new homes, jobs, education, health, leisure, sporting and cultural amenities.
- A net contribution to the Local Authority General Fund of around £2m per annum which could be invested in the Garden City, or elsewhere in the local area.
- A potential “super-profit” of £50m from the development which could be shared between the Development Corporation and the Local Authority, to be spent on a wide range of purposes including regeneration in other areas.
Wei Yang & Partners and Peter Freeman are confident that their strategy for new Garden Cities will prove to be an attractive proposition for Local Authorities, Government and local people.
The winner will be announced at a gala dinner on Wednesday 3 September 2014 at the Royal Institute of British Architects.
Wei Yang, Chairman of Wei Yang & Partners, said:
“Place-making is at the heart of our Garden City proposal. The vision for each Garden City should draw on the character of the local area, its natural and built environment, its heritage and natural assets. These should provide a framework for new development, fostering a sense of legacy and natural evolution.”
Pat Willoughby, Planning Partner of Wei Yang & Partners, said:
“We have very much enjoyed our collaboration with Peter Freeman and the opportunity presented by the Wolfson Economics Prize 2014 to explore new models for delivering Garden Cities. We believe that we have devised a practical, realisable strategy that could be delivered quickly and easily, using existing legislation, by any Local Authority in areas of intense housing pressure or with potential for significant economic growth. Our “Arc of Opportunity” from Southampton, through Oxford and Cambridge, to Felixstowe is not the only place for new Garden Cities, but it is a good place to start.”
Peter Freeman said:
“Working with Wei Yang & Partners and other members of the team has given me a great opportunity to work up my ideas for delivering and financing Garden Cities in a multi-disciplinary team environment. By acquiring land at reasonable values, above Current Use Value but less than might be expected on the edges of existing towns and cities, we can capture the uplift in land value and put it to good use in the Garden City and, potentially, elsewhere. A Development Corporation with CPO powers will ensure that delivery can be achieved. I am confident that our strategy will become attractive to property developers, potential investors and to Local Authorities.”
Lee Shostak, Chairman of Shared Intelligence, said:
“Local Economic Partnerships located within or touching upon the “Arc of Opportunity” collectively identify the potential for some 650,000 new jobs and 590,000 new homes in their Strategic Economic Plans. This gives us great confidence that new Garden Cities located in this area will be economically robust, and will provide much needed new housing. The use of the New Towns Act 1981 means that Local Authorities can start to plan for their needs immediately and deliver new jobs and housing quickly.”
Mei Ren, Technical Director, Buro Happold, said:
“The strategy that we propose gives us the opportunity to apply sustainable engineering technologies to create low carbon and climate resilient infrastructure and to deploy ‘smart city’ technologies to support a socially responsive urban environment. Planning at large scale and starting from scratch presents opportunities that do not exist elsewhere.”
David Elsmore, Partner, Gardiner & Theobald, said:
“The cost planning that we have undertaken for the Second Stage Submission by Wei Yang & Partners and Peter Freeman is based on our experience of large scale, mixed use development projects elsewhere. We are confident that this delivers a realistic assessment of costs to be used in the financial viability assessment.”