h e Te r r i e r - Aces · blazing down and winter is behind us. This issue contains an extended section on ACES branch ... North East student prize - John Read.....56 London - Alan

The Journal of aCeS - The aSSoCiaTion of Chief eSTaTeS SurveyorS & ProPerTy ManagerS in The PubliC SeCTor voluMe 22 - iSSue 1 - SPring 2017

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3THE TERRIER - SPRING 2017

EDITORIALBetty Albon

Th e Te r r i e rThe Journal of aCeS - The aSSoCiaTion of Chief eSTaTeS SurveyorS & ProPerTy ManagerS in The PubliC SeCTor voluMe 22 - iSSue 1 - SPring 2017

ConTenTS

Welcome to this edition of The Terrier. I feel as if I should swing from the rafters – and not only because the sun is blazing down and winter is behind us.

This issue contains an extended section on ACES branch events. Without exception, every branch which has submitted a report – and that is only 4 of you, so where are the rest? – has outlined the presentations received at branch meetings. There is no question that ACES is providing excellent CPD at its regional meetings. It is also borne out by the high numbers of attendees at events, both members and guests. We need to be signing up those non-members, as the advantages of being an ACES member are obvious.

This brings me neatly on to mention ACES National Conference. Look out for the flyer in this issue, as well as keeping an eye out at http://www.aces.org.uk/2017Conference/ .

Other highlights include summaries of the implications of Brexit on property, the Housing White Paper on housing delivery, and a host of papers about performance monitoring. Other topics range across partnership working for office rationalisation and housing schemes, how better to use asset valuations and lots more. Also pleasing is that many authors are ACES members and advertisers. Thank you everyone.

While every reasonable effort has been made to ensure the accuracy of the information and content provided in this document at the date of publication, no representation is made as to its correctness or completeness and no responsibility or liability is assumed for errors or omissions. The views expressed by the authors are not necessarily those of ACES. Neither the authors or ACES nor the publisher accept any liability for any action arising from the use to which this publication may be put.

ACES National

Council Meeting - Keith Jewsbury...........................................04

Membership news - Keith Jewsbury..............................................06

ProfessionalHousing White Paper - Laura Ludlow........................................07

Brexit - RICS priorities - Hew Edgar...........................................11

Partnership working - Steve Gell................................................14

Optimising assets, multi-agency - Brian Prettyman................16

Passivhaus partnership scheme - Melvyn Stone.......................19

Managing heritage assets - Alan Phelps....................................23

Benchmarking performance - Dr Rachel Dick.........................26

Benchmarking performance - David Bentley............................30

Green estate performance - Merrick Denton-Thompson........32

Protecting green spaces - David Solly........................................34

Model estate performance - Catherine Penman.....................35

Fixed asset valuations - Margaret Wells........................................38

District heating systems - Peter Mason........................................40

Property fraud - Owen Talfan-Davies.............................................42

Retail-led regeneration - Stan Edwards.......................................43

Financial sustainability (NAO).........................................................45

Investment strategies - Kevin Joyce...........................................46

Branches newsEastern - Duncan Blackie.....................................................................50

Heart - Peter Burt................................................................................52

North East CPD day - John Murray................................................53

North East - John Read.....................................................................54

North East student prize - John Read.............................................56

London - Alan Wharton.........................................................................56

Other interest areasA rebel’s tale - Dave Pogson.......................................................58

Gloucester Gladiator..........................................................................62

Estate Gazette quotes..........................................................................64

Suffolk Scribbler.....................................................................................66

Cover photo: Carrowbreck Meadow Passivhaus scheme near Norwich. Thanks to Jefferson Smith of Hamson Barron Smith (architects) for supplying the photo.

4 THE TERRIER - SPRING 2017

ACES National

14 members attended the meeting that was held at the Guildhall, London.

President’s report

The President, Daniella Barrow, reported that she had arranged to visit the Heart of England, Eastern and Scottish branches and will contact the other branches to arrange visits during her year of office.

She had already attended a CPD event at Sheffield Hallam University on 12 January, met with the RICS and attended the GVA/London branch Expresso Meeting that morning.

She was in communication with the Public Health England Chief Executive who is keen to work with ACES to promote the Health Agenda and the use of community assets.

As yet, she had no update on the post of Junior Vice President but was pursuing the matter [Ed – any members interested, please speak to either Daniella or Keith].

Secretary’s report

The Secretary reported on matters arising during the period from 21 October 2016 Council meeting and confirmed that all subscription invoices had been sent out and payments were being received in increasing numbers. The need for purchase order numbers

was slowing down the collection and some 120+ invoices had been re-sent.

He intended to visit the remaining 4 branches that he had not already visited and also noted that the website Forum was being well used with 6 entries in January.

It was unfortunate that 2 branches had scheduled meetings that clashed with the Council meeting and he will contact the branch secretaries to draw this to their attention.

COPROP had made contact and expressed a wish to continue the dialogue with ACES. Council is willing to continue but wishes the matter to be finalised by the April Council date.

Financial matters

The Treasurer reported on the finances of the Association and in particular for the first 6 months of the current financial year and confirmed that in general terms, apart from the conference abortive costs, the overall financial position is within the budgeted-for parameters for the year. The cancelled conference costs will result in a deficit for the year.

Annual conference member survey

The President presented her summary findings from the survey but reiterated

that she needed to drill down into the returns more and break down the results into the categories of membership, age profile and those who had and had not attended conferences.

150 returns from the 346 members was a good result and she thanked those members who had taken the time to feed back the information.

After a lengthy discussion, the President confirmed that she intended to forward further information to members and form a working party to progress matters.

Annual Conference 28/29 September 2017

The President reported on progress with the organisation of the conference to be held in Leeds. She had visited a number of venues and was awaiting costs from them. She was aware that information needed to be sent out to members shortly to confirm the venue and give other information that was available. Also, that costs should be provided as soon as they were firmed up.

August Council venue

Council decided that the 18 August 2017 meeting should be in Manchester and requested the Secretary to book a suitable venue.

NOTES OF ACES NATIONAL

COUNCIL MEETING

27 JANUARY 2017

Keith Jewsbury, ACES Secretary

ACES NATIONAL CONFERENCE28 and 29 September 2017

The Royal Armouries, Armouries Drive, Leeds, LS10 1LT

AN OPPORTUNITY TO GAIN 6 HOURS

OF CPD ON EACH DAYJoin us to review the biggest areas that our members are facing and identify the solutions that can help make a difference. With such an enormous period of change and uncertainty, the ACES National Conference 2017 is the perfect opportunity for public sector property professionals to come together, to listen, share thoughts, take stock and re-energise. Over the 2 days the conference will examine and explore the political and policy environment, the economic outlook, the impact of Brexit and the latest thinking across the sector.

This year’s conference will be at the Royal Armouries in Leeds on 28 and 29 September. The Royal Armouries is a central location to Leeds with good connectivity by rail, car and air.

The conference will have a minimum of 6 hours CPD per day and will cover a range of subject areas including:

Housing, development and regeneration Commercial property

Legislation and legal updates Best practice initiatives

Asset valuation updates/refresh Business rates

Service delivery Health

Please watch http://www.aces.org.uk/2017Conference/ for further details of speakers and the programme, as the planning progresses.


ACES Award for Excellence 2017

The Senior Vice President, Neil McManus, will agree a timetable with the Secretary and draft the necessary information for the website. He hoped that the entries for 2017 will match the number and level of the 2016 and 2015 competitions.

ACES and health property

Neil Webster gave an enlightening talk on the various agencies involved in the health field and their interaction. Council agreed that health was now an important area for ACES members and the President proposed that a Council Liaison Officer for the Health Agenda be created and Neil Webster was duly appointed.

The future of the Secretary’s position

The President notified Council that she had received a letter of confirmation from Keith Jewsbury that, for personal reasons, he did not intend to renew his 3-year contract in November 2017.

Council agreed that the process for finding a replacement be progressed quickly in order that a smooth handover from Keith be attained.

Future meetings

ACES Council 21 April 2017 London

Annual Conference 28/29 September 2017 Leeds

Annual Meeting 17 November 2017 City Hall, Cardiff

Annual Conference September 2018 Cambridge

Annual Meeting November 2018 London

NOTE FOR YOUR DIARIES:

ACES Annual Conference, Leeds 28/29 September 2017.

Delegates are welcome to attend both days, or a single day.

I list below the changes in membership between 1 January and 31 March 2017.

New members approvedThere were 12 new applications approved during the period.

Lisa Bryan Valuation Office Agency

Paul Davies London Borough of Southwark

Joanne Duxbury Bolton Metropolitan Borough Council

Lynette Henny St Albans City & District Council

Ian McAuley Westminster City Council

Calum Morman Police Scotland

Philip Owen Westminster City Council

Chris Phillips Suffolk County Council

Chris Rushton Newable Properties Limited

Sarah-Jayne Steer Westminster City Council

Paul Wilkinson City of London Corporation

Ian Wilson Cambridgeshire County Council

MEMBERSHIP Keith JewsburyTransfer from full to past membership2 members transferred to past membership during the period.

Paul Humphreys

Dave Mee

Resignations 7 members resigned during the period.

Mike AckroydStuart FarrantAlex FitzgeraldRoger HandscombeAlan McHardyJohn PatersonLucile Rankin

Total membership

Full 230

Additional 56

Honorary 30

Associate 25

Retired 46

Total 387


Professional

Laura provides a comprehensive summary of the long-awaited Housing White Paper. She asks: “Whether the proposals prove ambitious enough to fix a system that by the government’s own admission is ‘broken’ remains to be seen.”

THE HOUSING WHITE PAPER

– A FIX FOR THE BROKEN

HOUSING MARKET?

Laura Ludlow

Laura is a Principal Associate at national law firm, Mills & Reeve LLP, specialising in real estate development work, advising education institutions, public bodies, institutional investors and developers on real estate and development projects. [email protected]

The long-awaited White Paper “Fixing our broken housing market” was published by the government in a flurry of media activity on 7 February 2017. In its introduction, the Prime Minister identifies the broken housing market as “one of the greatest barriers to progress in Britain today” due to the unaffordability of housing.

Headline-grabbing soundbites aside, the White Paper sets out the government’s proposals to boost housing supply in the short and long term, creating a more efficient housing market. Something is offered to players at every level in the market, and key stakeholders in local government and industry alike will play a fundamental role in delivering these proposals.

The White Paper promises radical, lasting reform, but is that what will be delivered? We look at the key themes in the paper and examine what effect they may have on the real estate market.

The comprehensive approach

Painting a negative picture of the current state of the housing market, the government proposes a comprehensive approach to tackle ‘failure at every point in the system’, with proposals split into 4 steps:

Step 1 - Planning for the right homes in the right places

Local authority action: Each local authority will be required to put in place an ambitious, up-to-date development plan. The planning process will be simplified, with more transparency, which must be welcomed. There will also be a consultation on introducing a standardised objective approach to assessing housing requirements at local level to avoid perceived inequalities and unfairness between authorities.

More available land: The Paper suggests the availability of brown field and surplus public land for housing development must be maximised and higher density housing in urban areas will be encouraged. Notably, however, it does not contain any proposals to erode Green Belt protection, with changes to its boundaries only considered in ‘exceptional circumstances’. Many commentators are seeing this as a missed opportunity to free up much needed land for

development. Depoliticising the Green Belt may yield greater results.

New towns: 2016 saw the 70th anniversary of the New Towns Act 1946, when Stevenage was designated as the first New Town. 2017 sees us looking back to revolutionary ideas of the past for housing solutions of the future.

The New Town movement flourished in the post-war need to rebuild communities. It was the product of the Victorian ‘Garden Cities’ vision of creating new, self-sustaining communities with residential, recreational, industrial and agricultural areas all in one place. 32 new towns were created between 1946 and 1970, but the movement lost political favour and the development corporations responsible for delivery were all wound up by the end of the 1980s.

Fast forward to January 2017, and the government announced plans for 14 new garden villages across the UK, and 3 further garden towns, with capacity (together with previously announced projects) to deliver 200,000 new homes nationwide. £6m of funding will be available over the next 2 years to support the delivery of the new villages, with a further £1.4m for the 3 garden towns.

The White Paper reiterates the government’s support of the garden


village/town project. It will encourage these and future developments to be locally led, aiming to create high-quality environments that match their surrounding communities, with development and infrastructure investment aligned.

The White Paper also supports the (re)introduction of New Town Development Corporations to assist local authorities with delivery. Planning procedures will be streamlined in the designated locations.

Financial institutions and charitable foundations may also be encouraged to invest in the construction of further new settlements in “pink zones”, along the same lines as those on which “workers’ villages”, such as Bourneville and Port Sunlight, were originally constructed.

The renewed focus on garden towns and villages returns to, but is arguably a step away from, the ethos of the Garden City model of previous decades. However, care must be taken at the planning stage – particularly with the garden towns, being close as they are to existing towns – to ensure these new communities can be truly self-sustaining. While tempting simply to connect to existing infrastructure without due planning, this may become further urban sprawl and commuter belt territory – this tends to be the main concern of people already living in the designated areas and will need addressing. Time will tell whether the rejuvenation of an idea from yesteryear can work for the housing needs of today and tomorrow.

Rebranding the HCA: A DCLG review in November 2016 concluded that the HCA needs to do more to increase the scale and pace of house building. The HCA was told things need to change – homes need to be built directly on public sector land and it needs to encourage more competition and embrace and work innovatively with various partners.

As a consequence, this summer, the HCA will be relaunched as Homes England. It will have a clear and unified purpose: ‘To make a home within reach for everyone.’ The main aim of this relaunch will be threefold:

ll to increase housing across all com-munities and housing tenures

ll to increase infrastructure to un-lock housing capacity, and

ll to attract small and new builders to diversify the market in a sus-tainable way.

The newly launched Homes England will be tasked with taking a more active role in relation to compulsory purchase, by working closely with local authorities to use their compulsory purchase powers to support the development and regeneration of land for housing (provided this is consistent with the local authority’s objectives and powers).

Together with other measures in the White Paper, this is intended to give local authorities the tools required to build more homes. But will the relaunch be more than just a change of name and have a positive impact on the “broken” housing market?

Step 2 - Building homes faster

Increased planning capacity: Local authorities will be able to increase their fees by 20% from July 2017 if they commit to reinvesting the additional fee income in their planning departments. Boosting the capacity of local authorities’ planning departments should correspondingly lead to quicker decisions on planning applications. Furthermore, it is hoped unnecessary planning appeals can be deterred by introducing fees.

Local authorities will also be held to account for their failure to deliver sufficient housing through a new housing delivery test, being forced to grant planning permissions if they fail to meet their requirements target and will have the ability to withdraw planning permissions if development is not commenced within 2 years (rather than the current 3 years).

Targeted infrastructure development: Government investment on infrastructure will be co-ordinated, targeting the £2.3bn Housing Infrastructure Fund; utility connections will be sped up to reduce home

building delays. Many developers are already benefiting from the HCA’s active participation in a number of key housing projects, with sizable loans advanced to forward-fund essential early infrastructure works.

Modernising the housebuilding sector: The White Paper indicates that the housebuilding sector is less productive than the wider economy due to its slow approach to modernisation. The government has therefore pledged to invest in modern methods of construction to boost productivity and innovation. Industry reports cited in the White Paper suggest homes constructed offsite can be built up to 30% more quickly than traditional methods, with a potential 25% reduction in costs.

Off-site construction is a development which is already taking place in the market, and represents the opportunity to overcome some of the underlying challenges, ensuring faster production and higher certainty of delivery. In addition, modern methods of construction can be highly energy efficient and require fewer people on site, helping to mitigate the ongoing skills shortage.

To underpin the growth of modern methods of construction, the government has acknowledged that access to mortgage finance must be available on the same basis as traditionally built homes. The existing Buildoffsite Property Assurance Scheme has reported a limited take-up among lenders, partly due to the limited amount of data available.

The government has promised to support a joint working group with lenders, valuers and the industry to ensure that mortgages are readily available across a range of tested methods of construction. This will include encouraging the development of a stronger set of core data to measure the use and performance of different technologies to encourage good decision-making.

Mitigating development delay: What about the infamous development delayer - the great crested newt? In its


perennial battle against the bulldozer, despite perhaps being considered the ‘underdog’, the great crested newt often comes up trumps, causing major expense and delay to new development. But has the White Paper finally shifted the odds in favour of the bulldozer?

Great crested newts are strictly protected by legislation and currently licencing is dealt with on a site-by-site basis, where their habitats are affected by development. This often causes considerable costs, delay and uncertainty for developments. In one example in Milton Keynes, a contractor spent more than £1m trapping and translocating the newts, delaying the construction of 6,500 new homes by up to a year.

Natural England has been running a pilot scheme with Woking Borough Council which will now be rolled-out across the country to help local authorities speed up the delivery of housing and other development. The scheme seeks to minimise the risk of great crested newt habitat loss by taking a landscape-wide approach and using DNA mapping of the newts.

Developers will be able to buy into the scheme, rather than undertaking individual site surveys and seeking individual licences, thus saving them time and expense. Surveys and habitat compensation will be undertaken at the district level by Natural England and the local authority. The financial contribution made by developers will assist the local authority to create new or improved greater crested newt habitats in suitable locations elsewhere. So for now it seems that the new scheme could bring the battle to an end, providing a better solution for all.

Natural England is proposing that a similar approach can be taken to other species that require protection, citing bats and voles as next on the list for a new licensing regime.

Step 3 - Diversifying the market

Supporting alternatives to large developers: There are several measures under this heading, including:

Small and medium sized builders will receive increased backing through the existing Home Building Fund

Custom build homes will be supported through greater access to land and finance

The Accelerated Construction Programme will bring new contractors into the marketplace to rival traditional builders.

Accelerating construction and increasing productivity is likely to act as a catalyst for change in the wider housing market.

Build to Rent: Institutional investors will be encouraged to invest in Build to Rent (BtR). By happy coincidence, the White Paper was published the same day as the British Property Federation (BPF) held its annual National Residential Investment Conference.

The BPF has long promoted institutional investment in residential property, being a vocal advocate of the private rented sector (PRS) now morphing into the BtR sector. BtR is becoming a recognised alternative asset class, attracting a range of investors and developers to meet a growing demand for rented homes. The BPF was visibly delighted that the government’s proposals give much prominence to BtR. The keynote speech from a senior DCLG civil servant on behalf of the Housing Minister emphasised the commitment in the White Paper: “For lenders, institutional investors and capital market participants, the government is offering a clear and stable long-term framework for investment, including products for rent. In return we call on lenders and investors to back developers and social landlords in building more homes”.

The industry will have the opportunity to shape the future of the BtR sector in further legislation via the consultation on Planning and Affordable Housing Build to Rent, published the same day.

Step 4 - Helping people now

Innovative housing programmes: There will be short term continuing support

for Help to Buy and Starter Homes Schemes and further investment in the Affordable Homes Programme. The government is also looking to develop a sustainable, workable approach to funding further supported housing.

Fairer letting: The government is aiming to make renting fairer for tenants, including introducing family friendly tenancies and is considering banning letting agents’ fees.

Increased transparency: The current system for registration of land ownership leaves much to be desired. There is a lack of coherency, with data available on various government websites such as the Land Registry and the Planning Portal. Some of the information is readily available and free, whereas in other cases a fee is payable, the information arrives much later by post, and when it does, it takes the form of a long legal document which is hard to read.

It is difficult for a lay person to establish a clear picture of a potential development site. For example, a person looking at a title register may quickly see who holds the legal ownership, but may not notice that an option to purchase exists or that the land is subject to a restrictive covenant which means that a third party controls development on site. This makes it harder for smaller businesses and self-builders to identify a ‘valuable’ piece of land, enter the market or expand beyond the areas they know well.

The White Paper announces a new programme to improve the availability of land and property data. The Land Registry will aim to provide speed, simplicity and an open approach to data and to achieve comprehensive land registration by 2030. Free of charge commercial and corporate ownership data and more information about wider interests in land will be available.

This is a welcome move and will assist by showing clearly who owns, controls and has an interest in land; helping identify who stands to benefit from a planning permission; and granting faster and simpler access to data which may help in assessing land value.


The stakeholders most likely to benefit from these changes are smaller businesses and self-builders, with fewer resources and less market experience. With laudable aims of transparency, simplicity and speed, we hope that the proposed changes will make a difference in practice.

A fix to the broken housing market?

Whether the proposals prove ambitious enough to fix a system that by the government’s own admission is ‘broken’ remains to be seen. Notably, many of the proposals aim to build upon existing schemes or put the wheels in motion to consult on more radical measures. More radical solutions that would see encroachment upon the Green Belt clearly remain politically charged.

The proposals offer something to stakeholders at each stage in the housing supply chain, recognising that their support will be crucial in delivering these wide-ranging plans. Such an approach can only be welcomed.

The provision of new homes of all types by a wide variety of providers for the whole range of the market – from traditional national housebuilder product, through specialists’ providers of student accommodation and retirement living communities, to modern methods of construction of dwellings backed by one of the leading life and pension funds - is crucial to meet the nation’s critical housing need.

The White Paper’s key message is that there has to be a full range of actions to enable and speed up the delivery of considerably more new housing, and it is for the housing industry, in all its various sectors, to do this.

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BREXIT AND RICS PRIORITIES Hew Edgar MCIPR

Hew joined RICS in June 2012 as Policy Manager (Scotland). Having graduated with an Honours degree in Politics and International Relations at the University of Aberdeen, he has held various policy posts in the UK and Scottish governments, as well as other membership organisations. He leads on RICS’ policy development and public affairs across all priority issues in Scotland. In addition to contributing to RICS’ UK and Scottish projects, Hew actively promotes RICS’ thought leadership to government and Parliament. Most recently he co-authored the RICS EU Referendum Impact Paper (2016). [email protected]

The triggering of Article 50 set the UK on course to leave the European Union. Unless all remaining member states unanimously agree to extend the 2-year negotiation period, the UK will formally exit the EU on 29 March 2019. With the Great Repeal Bill White Paper now published, and questions on the future of the UK constitution being raised, the UK’s future – particularly for the next 2 years – could be very turbulent.

RICS’ response to the Prime Minister on 29 March 2017 was clear: “Government and industry need to work together to get the best deal possible and ensure our country’s future growth and prosperity — it is everyone’s responsibility to make Brexit work.” Despite the unstable economic conditions over the last decade, the UK has managed to retain its stature on the global economic stage. It is imperative that political effort is targeted to maintaining this position, and the land and property markets and industry participants can make a valid contribution to this endeavor.

The delivery of key domestic infrastructure projects: airport hubs, high-speed rail networks and energy systems – to name a few – are needed to make the UK’s cities and industrial hubs globally competitive. This will be critical to our future success;

Hew sets down RICS priorities for the Brexit negotiations.

neglect is simply not an option. However, it would be unrealistic to expect government to deliver a successful Brexit without the full, and constructive, support of industry.

Consideration of construction skills

At this point, it is important to recognise, through recently published RICS figures, that the UK construction industry could lose up to 176,500 EU workers post-Brexit if access to the single market is lost. Coupled with the severe skills’ shortage already facing the UK’s construction industry, these 2 factors could threaten some of the country’s biggest (“mega”) infrastructure and construction projects.

RICS has been openly critical of government policy towards overseas construction professionals. At present, ballet dancers are considered as crucial by the UK government, and are therefore prioritised during the visa application process; construction professionals are still to be added to the 'UK Shortage Occupations List'. That’s not to say the UK doesn’t need ballet dancers, but we are not convinced that the UK’s ballet troupes can contribute £103bn to the UK economy that the construction sector did in 2014. Indeed, we have warned that neglecting the needs of the construction industry could jeopardise the UK’s predicted £500bn infrastructure pipeline. To make the post-Brexit UK work, this needs to be addressed as a priority.

While the UK government is likely to steer its efforts in securing a future trade agreement with the EU, industry must work to secure a domestic skills pipeline. As the industry’s professional body, RICS is working with government and industry to develop that skills base; building vital initiatives, such as degree apprenticeships in our sector, to drive the talent pipeline forward. Whether sector participants are for or against Brexit, it is vital that industry gets behind such schemes for the UK’s long-term good.

Investing in infrastructure

Qatar recently pledged to invest £5bn in British transport and construction projects, indicating the attractiveness of the UK as a foreign investment destination. RICS is firmly of the view that if the UK government puts the right incentives in place, the UK’s energy, rail and road infrastructure will benefit from further billions of overseas investment.

However, again, industry must also play its part. The costs of infrastructure projects across the globe are measured and forecasted differently; which is why the same high-speed rail project in Spain would have an entirely different projected cost if it was located in the UK; even after accounting for currency differences or regional labour and material costs.

This is why RICS is working with


industry partners to introduce a new standardised global measurement - International Construction Measurement Standard (ICMS: https://icms-coalition.org/) - that will allow investors to compare like-with-like. We believe that this will help to put infrastructure firmly on the map as a global investment opportunity.

Only greater cooperation between government and industry will deliver a construction sector that is robust enough to withstand any future political and economic uncertainty.

The Great Repeal Bill

Published last week, the Great Repeal Bill will transfer EU statute into UK law, and this will not be an easy process.

RICS has long maintained that the land and property markets require confidence, which is the product of consistency and stability. Unravelling EU rules, and stitching them into UK law will be a complex undertaking which has the potential to knock sector confidence – a necessity for long-term investment. This is because the majority of business enterprises across the UK will be affected in some capacity by the Bill; thus sector engagement, and close government-industry liaison, is imperative. Placing political lines over industry needs could have a disastrous effect.

Indeed, RICS regularly reminds the UK government not to lose track of domestic issues and focus on growing the economy. A key avenue here is the UK’s Industrial Strategy, the Green Paper of which is out for consultation. This strategy can play a pivotal role in creating a stable UK plc by, for example, encouraging younger people to enter, and continue in, built environment education. However, at present it lacks due consideration of the role of land and property; again, this needs to be remedied.

Furthermore, the long-awaited Housing White Paper – the first paper of its type from a Conservative Government since 1995 – has come at a good time. House building figures have been deficient for decades. This means that not only does housing delivery need to match current

annual demand, it needs to exceed it to make up for the shortfall. Only a cross-tenure approach, delivered at pace, and across the affordability thresholds will suffice going forward.

Questions over the constitution

It would go against RICS’ Royal Charter to lean in favour of a constitutional framework, but the issues and debates arising in the UK’s constituent parts cannot be ignored.

Scotland

The Scottish government produced “Scotland’s Place in Europe” in late 2016; more recently, the First Minister – backed by Parliament – announced her intention to seek a second referendum on independence. In the former document, the First Minister laid out her ambitions for Scotland’s future relationship with the EU and the UK, and her desire to have an open debate around these vital issues.

It is beyond doubt that this will be welcomed by independence supporters, but the prospect of another independence referendum runs the risk of adding additional uncertainty for markets, which are already slowing due to the unknown consequences of Brexit.

Indeed, in 2014, Scotland held its first referendum on independence and Scottish businesses reacted by continuing business transactions (be it a lesser quantity), regardless of the debate. At the time, it was difficult to ascertain whether the dip in commercial activity was due to the slow economic recovery after the crash of 2007/8, or the prospect of an independent Scotland.

This time round, the same arguments around the economy and currency will resurface. But again, it is hard to point the finger on Scotland’s slowing economic growth: a potential second independence referendum or Brexit.

Northern Ireland

One of the biggest concerns for

Northern Ireland is the shared physical land border with another EU member state. The Common Travel Area (CTA) is an agreement – not enshrined in legislation - between the UK and Irish governments which first surfaced circa 1920. Both governments have agreed reciprocal visa arrangements and to share immigration data. However, with the UK set to renounce its membership of the EU, and with it the right for freedom of movement among the bloc, the issue of immigration between the North and the Republic becomes a sticking point for negotiations.

As an EU member state, the Republic of Ireland is technically not able to negotiate a bilateral deal with the UK on its immigration policy. Any restrictions on the flow of goods and services between the 2 countries could have a damaging impact on Northern Ireland's economy and cause a ripple effect across the rest of the UK and the Republic of Ireland.

Wales

Shortly after the Scottish government published “Scotland’s Place in Europe”, the Welsh government, published its own policy document on Brexit which set the scene and outlined priorities.

Wales is also within the midst of chronic housing and infrastructure shortages that require a highly skilled and sizable workforce. RICS in Wales is keen to hear reassurance that workforce migration will be addressed as a priority, as a means to maintain the perception of Wales as an attractive investment location: an arena where major corporate and industrial occupiers want to do business.

First Ministers in the devolved nations are expected to play their part in minimising uncertainty. In setting out its proposals, the Scottish and Welsh governments have fulfilled their responsibility.

RICS priorities in the Brexit negotiations

Throughout this article, RICS has emphasised its belief that vibrant, sustainable and resilient property,


infrastructure and construction sectors are vital to ensuring the long-term prosperity of the UK. This prosperity will grow through access to international labour, markets and capital.

RICS is already at the forefront of efforts to develop and embed international standards for valuation and measurement for both construction and real estate. These standards contribute to market transparency, encourage investment, and are increasingly adhered to around the globe.

While the Prime Minister has set out 12 high-level priorities for the UK to leave the EU in the 'Plan for Britain', it is incumbent on professional bodies to inform ministers on the impacts and opportunities which this change creates. RICS has developed its top 5 strategic priorities in the Brexit negotiation process:

ll Lay out a clear timeline and set of ambitions

RICS is firmly of the view that the UK government can minimise uncertainty over the exit negotiations by laying out a clear timeline and set of ambitions. Certainty and stability are a key requirement for the development pipeline. Furthermore, RICS would support transitionary arrangements

to avoid any potential "cliff edge", and there needs to be assurances made that investment into UK real estate continues, and that both foresight and fiscal stimulus through this process will help the industry weather uncertainty.

ll Tackle the infrastructure challenge and attract private investors

As mentioned previously, the UK’s infrastructure deficit will hamper the UK’s global competitiveness unless it is tackled head-on, and government must seek out and attract private investors. This will improve productivity and regional rebalancing in the UK, while enabling the UK to become an even greater global gateway for trade and tourism beyond Brexit.

ll Provide access to a skilled inter-national workforce and develop home-grown talent

Access to a skilled international workforce and a focus on developing the next generation of home-grown talent cannot be over-emphasised to ensure we can build the homes, businesses and infrastructure we need. Central to this is the free movement of construction skills within the future immigration system.

ll Agree on the "passporting" of professional services

Agreement for the "passporting" of professional services, including chartered surveyors, is essential to the majority of global, UK-based real estate firms and the projects they support. The passporting of professional services (including accountancy and law), as well as the financial services sector, is hugely important to the investment in, and occupation of, commercial property, and the footprint of such firms in our major cities, not just London.

ll Capitalise on the chance to reset British agriculture

Separation from the Common Agriculture Policy provides a unique opportunity to reset the UK’s agriculture and environmental policy system. The management of land, over and above ownership, is crucial to farm production, quality of our landscapes and natural diversity. While basic support structures must be maintained, albeit at new levels, greater focus needs to be geared towards those who manage less favoured areas. RICS stands ready to work with governments across the UK, and with stakeholders and policymakers at all levels as we prepare for a period of great change.

All of RICS’ activity around this debate can be found at our Brexit hub: www.rics.org/brexit

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Background and OPE

With the government’s Revenue Support Grant being phased out, councils are looking to be financially self-sufficient and investigating new ways of finding income.

With stretched resources, council property teams have a challenging mandate. Given the determination to search for commercial investments, is their eye being taken off the operational service property portfolio? Some 75% of councils are now involved in the One Public Estate (OPE), initiative so how is this affecting the balance between councils committing resource to new commercial opportunities without losing focus on existing operational services?

Faced with pressure to replace diminished revenue streams, resource is often directed towards these ‘quicker win’ commercial investment opportunities. In some circumstances, however, greater financial gain and service improvement can come from focusing on the operational portfolio.

Steve outlines what should be good practice for councils looking to succeed in partnership working. See also the article from Brian and Quentin at Suffolk County Council, which puts this advice to excellent effect.

LOCAL AUTHORITY PROPERTY

STRATEGY – PREPARING FOR

SUCCESSFUL PARTNERSHIP

WORKING

Steve Gell

Steve is an Associate Partner in the Consultancy & Strategy team at Carter Jonas. He has been undertaking strategic review and estate rationalisation work for public sector organisations for 15 years, with a focus on operational services. [email protected]

These 2 areas can, of course, work on a complementary basis.

The complex and diverse nature of local authority services can often represent a significant hurdle to the transformation of the operational estate. Successful transformation of any operational property portfolio only occurs when either the property team properly understands the business operation, or the business operation fully understands property. In a reactive local authority scenario it can often fall to the operational service teams to understand property dynamics, which can cause difficulties and frustrations in the change implementation process.

A ‘Corporate Landlord’ (centralised management model), seeks to minimise these stresses but requires the property team to have a complete understanding of the service perspective. The difficulty is that the amount of time required to develop a sound understanding of a complex array of local authority services can be considerable. For example, any typical surveyor’s natural area of focus will be on his or her pipeline of day-to-day property tasks, leaving the development of an understanding of legislation that drives the services’ property needs feeling like a tall order. The reciprocal is also true for service leaders seeking to understand the intricacies of property markets and property law.

One of the greatest opportunities for driving efficiency from the operational estate can be found in the co-location of services. Consolidating services into less property can offer a meaningful and sustainable reduction in the size of the council portfolio, release land and buildings for housing and employment growth, as well as delivering capital and revenue potential on a sizable scale. The Local Government Association (LGA) shared services agenda promotes the ideal of sharing services between public partner organisations; sharing property is an inherent part of that model.

However, the real test is in considering all site-sharing opportunities from the wider public sector base and not restricting proposals to only the local authority service need. Co-location options identification should also embrace the service need and operational strategy of other partner organisations including, for example: NHS; blue light; central government;


district; town and parish authorities. Forming a detailed understanding of the service needs and property supply for all organisations is a monumental task but fully achievable through a structured approach and the application of dedicated resources.

The process of data collation must be undertaken as a holistic exercise to discover the full scope of opportunities across all public sector partners. This requires determination and a high level of strategic direction and programme management to be successful.

Undertaking this ‘Service First’ approach can appear daunting but the results can offer a dramatic change to the local authority portfolio. It is a crucial investment necessary to achieve a directional shift. Unfortunately, political inertia and financial pressures of a local authority don’t always allow for such a detailed strategic review of both property and services to achieve this greater long-term gain.

To overcome the financial and resource ‘gap’, funding and advice is offered from central government and the LGA with the OPE programme, supporting public sector partnerships to work collaboratively on land and property initiatives. But with OPE support and funding available for both investment and operational projects, are councils utilising the scheme to their best advantage?

Under the OPE scheme, a council, usually at county, borough or unitary level, is expected to be the lead organisation, promoting change in its geographical area. For these councils, orchestrating partnership working within its jurisdiction is a considerable undertaking. Proceeding with any

partnership project requires the lead authority to have, at a minimum, a sound understanding of its own operational needs and estate in order to have a realistic prospect of directing complex partnership working opportunities.

Some issues

Entering into partnership working without a clear service strategy is often the cause for delaying new schemes and developments. For example, a council may be deciding which services should locate to a retail unit which has become available within a newly proposed town centre scheme. Will the library move from its old location into the new scheme? What format should the new library take: a front desk ordering service or traditional layout? The old library may have shared space with a children’s centre. Should it move into the new scheme too, or is the new location in the wrong catchment area for their customers’ needs? How does

this affect the other children centres in the area? The local youth centre has suggested they could use the new library space in the evenings but the space would have to be slightly larger in the new scheme and will this be possible? If the move is to be viable, what will be the future of the existing site? Does this need to be offered to other services before being disposed and what level of consultation has been conducted before any of these services can be moved? Or is this all too difficult and we’ll just let the unit to a local coffee shop, as it is so much easier?

A strategic review of service positioning carried out before partnership working can assist in offering faster decision-making when regeneration schemes and development projects are being conceived or delivered, often ensuring that council services are at the front of the queue and have the opportunity to select the right location for them rather than taking what is left. This prior service consultation process also ensures that sharing opportunities are based on beneficial collaboration between services rather than 2 or more services sharing buildings simply to suit a geographical or financial convenience. The latter is not at the core of the OPE ethos.

This ‘service first’ preparation allows the lead partner to identify a new estate blueprint of public sector partner hubs, rather than fragmented service placement.

In some circumstances, when considering a new OPE project, councils will benefit from firstly looking inwards to their operational estate (rather than outwards), to create better collaborative working and achieve greater and longer term financial gains.

At the Property Week awards in April this year, our service-led strategy review was nominated for the Occupier of the Year award. Our client, Buckinghamshire County Council, was up against Google and Apple, among others. While we didn’t win, raising the game of local government strategy to this level should be mandatory as we try to place council services closer to the front of property decision-making.


Brian and Quentin outline the progress of the council and other public organisations towards integrated property sharing. “It is anticipated that the presence of district and county councils plus health in the same HQ building will change the working dynamics of all the organisations.”

OPTIMISING ASSETS

IN A MULTI-AGENCY

ENVIRONMENTBrian Prettyman and Quentin Cass

Brian is Senior Manager Corporate Property and Quentin is Property Transformation Manager, both at Suffolk County Council.

Background

In 2004 Suffolk County Council (SCC) moved from cellular office space in buildings dating back to the 1840s into modern open plan facilities at Endeavour House in Ipswich. What’s more this was at a ratio of 10 people to 8 desks. At the time it was believed that the council had made a great cultural advance with associated financial and operational benefits.

In the intervening years there have been a succession of “re-stacks” where SCC has reorganised the staff accommodation to match the changing needs of the authority. This has become an increasingly quick and simple process as technological improvements have been rolled out. As a consequence of these moves, average ratios of 7 and then 6 desks for every 10 people have been achieved. These are, of course, averages and much higher and lower ratios of staff to desks are present in some areas. Nevertheless the number of staff requiring fixed desks continues to fall and one would anticipate that there is scope to continue to increase the ratio of staff to desks.

In 2015 there was a further re-think about how efficiently the council’s office buildings were being used. This was largely budget driven. Over previous years a series of savings initiatives had resulted in the council exiting most of its leased accommodation and disposing of the majority of its surplus or underused premises. This has limited the scope for further savings and as the council’s 5 main office buildings consume more than 50% of the total non-schools’ property budget, future savings initiatives needed to focus on these main offices. Most remaining office space is in key locations, much of it also being in shared public sector buildings, therefore the scope for further revenue reduction needed to focus on income-earning rather than exit. The need for further revenue reduction coincided with increasing interest from central government in shared public sector space, as evidenced by the One Public Estate (OPE) initiative. Suffolk already has a good track record in shared office accommodation. It jointly owns, and occupies, 3 major office buildings: West Suffolk House (jointly owned with St Edmundsbury Borough Council), Landmark House (jointly owned with Suffolk Police) and Riverside Offices (jointly owned with Waveney District Council). Dialogue with other public sector partners has now highlighted further opportunities for co-location within SCC buildings, providing sufficient space can be identified to accommodate them.

Identifying capacity

It was only by actually counting the number of desks which were occupied during the day that it became apparent that the previously accepted indicator of staff to desk ratios was giving a less than ideal picture of usage. On a trial basis the occupation of desks within selected office areas was checked 3 times a day, over a 7-week period, and this revealed that, in some instances, physical occupancy was below 50%. This 2015 survey was repeated in 2016, across the whole of the county council’s HQ complex (1,800 desks or thereabouts), and by interrogating the data on a team by team basis, it was possible to identify areas of good and bad practice and to formulate a plan for raising areas of low utility by reducing the areas occupied by low usage teams.

Senior management buy-in has been obtained for a target of 80% desk-utilisation during the working day. This is based on the identified best performing areas of the council’s HQ complex. A programme of restacking has been formulated and is currently underway.

In the meantime, negotiations have progressed concerning the leasing of space to Babergh and Mid Suffolk District Councils, (who share chief executive and back office arrangements). These councils currently occupy headquarters buildings which they have held since 1974, both of which have significant


backlog maintenance and are not particularly space efficient. The opportunity to move to a single location at Endeavour House offers financial and operational benefits for the 2 councils, a new income stream for the county council (rent and shared running costs) and the opportunity for much closer working between county and district level authorities.

In-principle, agreement has been reached and the 2 districts are expected to move into Endeavour House in summer 2017. By Christmas 2017 they are expected to be joined in Endeavour House by the East Suffolk Clinical Commissioning Group (CCG) which will be exiting leased property on the western fringe of Ipswich. These organisations will join the Norfolk and Suffolk Foundation Trust (NSFT) which moved its Suffolk HQ to Endeavour House in 2014. It is anticipated that the presence of district and county councils plus health in the same HQ building will change the working dynamics of all the organisations. The county council’s experience at other locations is that the proximity of staff and services naturally leads to increasing levels of joint working, collaboration and communication, with substantial benefits for service delivery.

One Public Estate

In order to fully realise and accelerate the benefits of the opportunities presented by these new co-locations, the county council and partner authorities submitted a proposal to the OPE programme in December 2016, to form a new Ipswich and Central

Suffolk property partnership. This new partnership, which has successfully joined the OPE programme, includes the county council, Ipswich Borough Council (which occupies Grafton House, opposite Endeavour House) Babergh and Mid Suffolk District Councils, the CCG, NSFT, Ipswich Hospital Trust, Suffolk Fire & Rescue, Suffolk Police and Crime Commissioner and the East of England Ambulance Service.

A new Programme Board will be created to coordinate the OPE Programme in Ipswich and central Suffolk, to achieve the delivery of the shared and individual priorities of the partner organisations, and to achieve the objectives of the OPE programme. An early strand of the proposed work is to consider how the benefits of co-location and service integration can best be taken forward and accelerated to create an Ipswich Public Sector Hub.

Benefits

In terms of property assets, these moves will bring immediate efficiencies and savings for the public sector as a whole, through the premises that will be vacated. Running costs of about £1.7m p.a., from Mid Suffolk, Babergh and CCG premises will be released, with the benefit effectively shared as new lower costs to occupy shared space in Ipswich will help to offset building overheads of retained assets.

The relocations will enable the release of more than 2 hectares of development land in the market towns of Hadleigh and Needham Market. These sites have the potential for

redevelopment and delivery of c100 homes and associated capital receipts. Furthermore, capital costs of about £6m, being expenditure that would be needed to maintain and upgrade these existing headquarters buildings, will be avoided.

Perhaps more significantly, the creation of the new partnership and the co-location of public sector bodies has potential for wider service benefits. There are, however, challenges to embrace if the full benefits are to be achieved. Some of these challenges are:

ll how will the benefits of co-loca-tion be translated into the more substantial benefits that will come from service collaboration and integration – ‘one service’?

ll what opportunities exist to make even better use of the partners’ combined assets, not only through maximum occupancy but also making workspaces more flexible, leading to greater organisational agility?

ll are there changes in the workplac-es that can bring mutual benefits to all organisations – for example could the creation of dedicated workspaces for multi-agency project work, meeting room suites or quiet areas bring benefits to all partners?

ll can organisations move freely between physical locations without access, security or IT issues – ‘work-ing beyond walls’?


ll how can a culture of smarter working be encouraged and em-bedded across a range of adjacent partners?

ll what is the potential for more combined public access strategies – is this physical or digital and can it incorporate wider public bodies (e.g. Department for Work and Pensions)?

ll what staff (and visitor) car parking strategies need to be agreed and put in place, and can this be done across the partners to bring ben-efits to all in terms of accessibility, car parking revenues, green travel promotion and optimum land-use?

ll how can ICT add further value, either through the provision of shared networks and/or the use of new technologies?

To unlock these opportunities, the partners will need to explore options for how to address some of these challenges. The bid for funding sought to address this, through support for

initiatives such as: the pursuit of a common IT platform for social care and health; the creation of dedicated spaces for multi-agency teams; combined car parking strategies for staff, visitors and public; the development of combined customer access strategies, which can open the way for further collaboration with additional health or central government partners.

Blue light collaboration

A further strand to this collaboration agenda is the opportunity for fire and police to relocate services to a proposed new-build fire and police station at Gipping Court, another part of the Council’s HQ estate. This will expand the programme of fire and police collaboration in Suffolk that has already taken place or is planned at 13 other sites across the county.

The Gipping Court site is within the emerging Ipswich Public Sector Campus and currently houses media communications equipment and some facilities management services. The site

is underused and has been identified by fire and police as a preferred location for this project, but there are constraints that need to be overcome to enable this development. OPE funding that has been awarded will support this work.

The new development could incorporate a range of town centre police functions, potentially accommodating 100+ officers and staff, alongside fire service functions in an improved response location. Property and service benefits will again accrue from this planned co-location.

The existing fire station, nearby at Princes Street, was built in about 1980 and is reaching the end of its economic life. To maintain the service in the long term from the current location would require significant investment (estimated £1m) for maintenance and upgrading. The site is in a prominent location mid-way along the Princes Street ‘corridor’ from the Ipswich Railway Station leading to the town centre. The proposals would enable the release of this prominent site for redevelopment, meeting employment needs and releasing a capital receipt.

Suffolk Police occupies a number of operational sites and buildings in and around Ipswich. The OPE funding will assist the Police and Crime Commissioner to enhance the constabulary’s strategic and operational estate by supporting feasibility to identify and maximise the collaboration opportunities that exist.

The Terrier

The Terrier is published quarterly by ACES. The inclusion of any individual article in the Terrier should not be tak-en as any indication that ACES approves of or agrees with the contents of the article.

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CARROWBRECK MEADOW,

NORWICHMelvyn Stone Melvyn is the Estates Director for the NPS Group. He has 30 years’ experience in property change management in both the public and private sectors, in varied economic climates. Property development in the public sector is a current focus. Everyone is a client or customer, even a colleague! [email protected]

This article is a follow up on a presentation which Melvyn made recently at ACES Eastern branch meeting. It is an innovative development, both in terms of a partnership approach and developing a scheme of certified Passivhaus affordable and private houses in Norfolk. Thanks also to Jefferson Smith of HBS for providing all photos, including the front cover to this Terrier.

This innovative development has been designed and delivered by certified Passivhaus architects at Hamson Barron Smith (HBS) for Broadland Growth Ltd (BGL), a joint venture company set up by Broadland District Council and the NPS Group, to provide:

ll positive intervention in the market-place driving up the quality of the housing product through design, space and material selection

ll income generation to support local community needs

ll protection of front line services, and

ll environmental excellence.

The design response at Carrowbreck is a contemporary rendition of a well-established and local typology - a ‘Norfolk style’ defined by a number of references to the historic barn vernacular seen throughout the county. A material pallet of white render, black stained timber cladding and either slate or plain red

roof tiles also reflects the materials used in the adjacent Carrowbreck House. The properties have been carefully grouped so the development sits comfortably in its woodland setting, with the positioning, orientation and design of the homes maximising access to solar gain.

The project was procured under a design and build contract and the HBS team, who completed RIBA stages 1-3, were novated over to the contracting side, ensuring a seamless continuation of the design process through the subsequent stages, the site works and the post occupancy evaluation.

Performance and sustainability

This project is innovative in its design, achieving full Passivhaus certification on a scale rarely seen in the UK, achieving a thermal bridge and draught free building envelope, and exceeding regulations for airtightness 5 times over. Air test results ranged from 0.2-0.5 ACH @50pa, and the homes will use ≤15kWh/(m2a) of heating energy, while maintaining perfect constant temperatures all year round. The positioning and orientation of the homes maximises the access to solar gain in winter and prevents overheating in summer, with brise soleil [Ed - an architectural feature that reduces heat gain within the building by deflecting sunlight] and venetian blinds reoccurring across the design to provide solar shading.

Fresh filtered air is provided to the homes utilising a heat recovery system capable of achieving over 90% efficiencies. All homes have electric car charging points,

rainwater butts and connection points for photovoltaics, and are compliant with the recommendations of the National Housing Standards Review.

The Passivhaus standard is internationally recognised as a leading low energy build standard; creating comfortable, healthy homes which are affordable to


run, eliminating fuel poverty, and future proofing these homes for the demands of our changing climate.

Working relationships

The project required collaborative working from day one. HBS and the planning team from NPS Group worked closely with Broadland District Council (as landowner) on behalf of Broadland Growth Limited, to manage sensitively both the commercial aspirations of the development company with regard to housing delivery and profit, and the relationship with the local planning authority, with its role to promote high quality development.

The development of the site for housing was not straightforward as it was located outside the defined settlement limit and heavily constrained by trees. The project had to be managed sensitively to overcome several planning challenges associated with trees, ground conditions, open space requirements, refuse/servicing, archaeology, highways and

viability issues, to ensure the scheme could be delivered within a very tight timescale and within the cost estimates.

HBS is one of a small number of architectural practices in the UK who can offer Passivhaus design expertise, with a proven track record of designing and delivering fully certified buildings. The architects worked closely with the contractor, R G Carter, to develop a build system that was bespoke for this project, addressing all site-specific ground condition challenges, the tight programmatic requirements and the project budget. As part of this service HBS completed around 30 psi value calculations in-house to analyse the performance of specific junctions, working closely with the R G Carter team pre-start to ensure that all of the details were achievable technically on site and that all of the materials could be procured through existing or new supply chains. Once on site, the collaboration continued as the teams worked together to ensure details were realised.

In order to ensure that exacting Passivhaus standards were achieved throughout the construction process, R G Carter engaged extensively with supply-chain partners. This included inviting Porotherm block manufacturer Wienerberger to its builders’ yard to deliver training to its directly employed bricklayers, apprentices and members of the supply-chain. Wienerberger also returned to deliver further on-site training at the Carrowbreck Meadow site. R G Carter also engaged Passivhaus consultant Whole House Energy to design and deliver a series of trade-specific toolbox talks targeted at areas where correct detailing was identified as being particularly important, for example not puncturing the airtightness layer during first and second fix, detailing around door openings, and avoiding thermal bridging.

Additional management resource supported achievement of the Passivhaus standards, with a designated Passivhaus champion and separate air-tightness champion.

Innovation and problem-solving

Many Passivhaus projects use Structural

Insulated Panel build systems or other off-site manufacturing, where a third party becomes responsible for achieving the airtight and thermal bridge free envelope. However, at Carrowbreck, R G Carter was keen to develop Passivhaus knowledge and skills rather than relying on a third party to deliver a kit of parts. Along with programme benefits, this led to the decision to use an innovative clay block construction.

Carrowbreck was one of the first UK projects to use these 300mm precision-engineered Porotherm blocks; a fast, virtually dry construction. With its rapid daily output (30-40 sq m/man/day), this brought cost and time-saving benefits, while its thermal and acoustic efficiencies will bring further advantages for decades to come, with a design life of over 150 years. The system used around 95% less water than traditional blockwork; the blocks achieve an A+ Building Research Establishment Green Guide rating, with 30% of materials from alternative, recycled or secondary sources and are recyclable at end-of-life; with only around 2% waste provision for the blocks.

The use of the clay blocks meant that a traditional wall plate solution to support the first floor joists was not possible. Instead joist hangers had to be built into the wall. These penetrated through the airtight layer so a specific detail was developed by HBS to address this, and then through collaboration with the contractor, this detail was further perfected on site. With the contractor’s airtightness champion taking charge of installing this specification on every plot, the attention to detail was excellent, as was apparent with the fantastic airtightness test results.

The blocks were combined with a brand new external wall insulation to the UK market - ‘Baumit Open EPS’ - the only expanded polystyrene system to be truly permeable, allowing the walls to breathe. Paired with lime plasters and mechanical ventilation heat recovery, it ensures perfect indoor humidity. The external render is microscopically smooth, creating a self-cleaning surface important on this wooded site.

The roof design called for innovation to stay on programme and budget; a site-

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constructed solution was developed with blown recycled newspaper insulation. Thermography was then utilised to ensure that the insulation fully filled the roof structure.

Overall outcomes

The client objective for this project was to deliver a mixed tenure scheme providing affordable housing for the local community, exceeding planning requirements, and truly tenure blind, not to be able to distinguish affordable from private dwellings, thereby demonstrating the inclusive nature of the development, creating a sustainable, energy efficient and mixed community.

This development has delivered a unique selection of contemporary homes set within a mature woodland. These homes are at the leading edge of low energy design, joining a small elite group of super low energy Passivhaus projects across the UK, and act as exemplars for future development in the area and beyond.

The scheme is on target to return £1,200,000 to the public purse including land value, fees, equity and profit. This is over 30% of the Gross Development Value.

The homes meet local market demand and housing need. The development completed in October 2016, and all of the homes have sold, surpassing the projected values set out in the business plan.

During the construction of the development, the contractor gave tours of the site so that methods of construction could be seen and understood by the wider community. HBS opened up 2 of the homes for technical tours, as part of the International Passive House Days, to share their Passivhaus expertise.

HBS is providing ‘soft landings’, tracking the energy and comfort performance of these homes with an advanced web-based monitoring system, ensuring not only their optimum performance but the continual refinement and improvement of the buildings. Although the homes have not yet been occupied for a full year, the performance data gathered so far shows the homes are on target to meet the demanding Passivhaus energy performance targets, and all of the comfort data is showing that the internal environment is excellent, and this is backed up by the experiences of new residents.

Once one full year of occupied energy and comfort data has been collected HBS will be disseminating these results, along with learning and technical information, at conferences across the country. The project is scheduled to be presented by HBS at the prestigious International Passivhaus Conference in Vienna, in April 2017.

The development has sought to involve the local community within the construction of the site, through apprenticeship schemes and utilising staff from the joint partnership and resources from the contractor and council to provide a woodland for the local community to enhance biodiversity, provide an animal haven and serve the local community, forming part of a green corridor extending from the city of Norwich to Drayton Woods. The development provides a new footpath to the nearest bus stop to

improve accessibility for this and future development sites. It is also the first to be served by the waste management contractor in Broadland on a permeable surfaced access road.

Some quotes

Chairman of Broadland Growth Limited and Broadland District Council Leader, Andrew Proctor

“Achieving environmental excellence in everything we do is one of our key ambitions and I’m proud of this development. The homes will meet exceptionally high standards of energy efficiency making them much cheaper to run than the average house, as well as good for the environment.

“Selling some of them on a shared equity basis will also help local people looking to get on the housing ladder. We intend this to be the start of development that Broadland Growth will undertake to provide top quality housing in Broadland.”

New residents and shared equity purchasers

“We chose Carrowbreck Meadow as it was set in a lovely woodland environment and built to Passivhaus standards. It’s aesthetically pleasing, modern, and a very spacious family home.”

“Yesterday I received my first gas bill for the period 4 October to 26 November, total charges are £14.88! So far, very happy with the cost of heating.”

“The air quality in the house is in general amazing, but the whole family have noticed that we all now have amazingly wonderful sleeps at night which we believe is due to the air quality. The consistent temperature of this house is perfect.”

“We both absolutely love the house and the surrounding area set in the woodland. We’re sure our daughter (now 11 weeks old already!) will love growing up here.”


MANAGING HERITAGE

ASSETS - NEW GUIDANCE

FROM HISTORIC ENGLANDAlan Phelps Alan is Strategic Asset Management Consultant with NPS Property Consultants Ltd (NPS) and has been involved in asset management since its inception in the UK. Alan originally worked as Principal Planning Officer at both Birmingham and Oxford City Councils. Before joining NPS Alan was Corporate Asset Manager at Kent County Council. In the last 10 years he has undertaken a range of asset management consultancy assignments both domestically and internationally. He has a PHD in Asset Management from the School of Public Policy, University of Birmingham. [email protected]

Alan outlines the value that properly managed heritage assets can play in sustaining uniqueness in our modern cities. “It is this past urban form that can act as the glue for the new urban form of future cities.”.

Context - past cities the missing element in Future Cities

Cities are beginning a new era of change. The trend of ‘hollowing’, as the suburbs grew faster than urban centres, is being reversed. Social, economic and technological changes are driving this change. People are increasingly looking to city centre living for convenience, lifestyle and because new housing is often built on redundant central sites. Sharing-economy business models are emerging that can allow more efficient use of physical assets such as buildings. ICT, the ‘internet of things’ and converging data standards are combining to support the socio-economic development of cities. National governments are positioning themselves to become leaders in urban innovation – there is a race to transform cities and reap the rewards from this which will be economic – new products, new companies and new jobs. These alongside an improved quality of life can create a virtuous circle attracting new residents and new business from around the world.

The literature on Future Cities concentrates on 3 themes which will help to shape new urban forms. These are energy efficiency; convenience

(access and mobility) and connectivity (inclusiveness). These can be recognised as key economic and technology factors but collectively they still do not provide the ‘missing ingredient’ that can make ‘our city’ different from other cities – the uniqueness which as residents we wish for our own city. To provide this we must look to the past and ensure that the cultural and historical legacy we have inherited in our cities is retained and enhanced for our future cities. It is this past urban form that can act as the glue for the new urban form of future cities.

This represents a challenge for asset managers – how to ensure ‘heritage assets’ can contribute to shaping future cities. The rather passive approach to managing heritage assets that sees them as inflexible in use and a ‘liability’, which acts as a drain on scarce financial resources, needs to change. Instead a more pro-active role needs to be adopted which recognises heritage assets, both individually and collectively, as strategic opportunities. More creative ideas need to be adopted to bring heritage assets into use, with a more ‘entrepreneurial’ rather than ‘stewardship’ role being adopted by asset managers.

NPS has being working with Historic England (formerly English Heritage) to update guidance to local government in

Hull Guildhall

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managing heritage assets. This guidance is directed towards asset managers and is placing emphasis on thinking more broadly and creatively about the options around heritage assets. It is hoped that the guidance can help to raise the profile of heritage so that our past is used positively to shape future cities, and that heritage becomes one of the underpinning themes shaping the future cities agenda.

Background to the guidance

English Heritage commissioned a report (Local Authority Heritage Assets: Current Issues and Opportunities, March 2012) and concluded that:

“A significant proportion of asset managers did not readily know what heritage assets were owned by their local authority…The obvious initial conclusion to draw from this is that the proper management of these assets must be questionable”

And that:

“English Heritage should promote the inclusion of information about the designation status, use and condition of heritage assets within asset management plans and asset registers, together with policies for their conservation.”

This research was the genesis for a programme of work undertaken by NPS on behalf of Historic England and led to

the publication of the latest guidance for local government on Managing Heritage Assets, due to be available shortly.

Purpose of guidance

The guidance is aimed primarily for local authority asset managers and is intended to raise the profile of heritage assets and to provide a framework of ‘best practice’. It is pragmatic and practical guidance which local authorities can use as they see fit to integrate into their own management arrangements. It contains a set of practical diagnostic ‘tool kits’ which local authorities are encouraged to modify and use to suit their local circumstances. It is not intended to replace any earlier guidance, but rather to reinforce it. The changing nature of local government and the resource pressures it is facing means that the management and treatment of heritage assets will require more innovative approaches – both to safeguard them for the future and to bring them into productive use. The guidance is also intended to illustrate what is possible through reference to case studies.

Format of the guidance

The guidance is not produced in hard copy form but is available to download from the Historic England web site. The narrative and ‘self-help’ ‘tool kits’ are organised around a simple structure for thinking about heritage matters. This framework is illustrated in the diagram.

The case studies are drawn from a wide range of local authorities, varied in terms of size, status and geography and these illustrate the rich range of work that local government undertakes on heritage matters. It is hoped that these will act as a catalyst to stimulate others and to encourage sharing of experience. The ‘tool kits’ distil ‘best practice’ into easy to understand and use templates. These are simply provided as a starting point

for a local authority’s own approach. An example ‘tool kit’, for Integrating Heritage into Asset Management Plans is shown opposite.

Conclusions

Heritage matters need to be more fully recognised by asset managers and require greater focus of attention. There is a need to encourage more sharing of the existing good practice that already exists in local government and also to raise the profile of heritage, so that it is actively considered as part of decision-making over the allocation of scarce resources. This guidance by Historic England is intended to provide a contribution to these objectives and asset managers are encouraged to read the guidance and to integrate the recommended practice into their existing policies and procedures as appropriate.

Historic England is holding a series of training days alongside the introduction of its new guidance. Places will be free to delegates on a first come first served basis and ACES members are encouraged to attend. Please check https://historicengland.org.uk/services-skills/training-skills/helmtraining/ to find dates, venue confirmation and booking procedures.

Simple structure of the guidance

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PEAK PERFORMANCEDr Rachel Dick, FRICS

Dr Rachel Dick, FRICS is Senior Consultant, Data Services at RICS. Her career passion is the use of data to support evidence based decision making to achieve business critical outcomes. Her journey so far has been vast and varied and has always come back to data, measurement and benchmarking in support of business case creation, project management and performance reporting.

Her career started at Bernard Williams Associates where she first learnt how to benchmark FM costs in the NHS and defence sector. She moved to EC Harris and became focused on the PFI market where she undertook value testing, operational monitoring and lifecycle maintenance fund analysis. Her work has spanned into a variety of sectors including health, water, aviation, custodial centres, schools and higher education, local authorities and financial and corporate sector clients.

Rachel’s current role is within the Data Services team at RICS and she is focused upon the relationship that exists between FM, lifecycle and building occupancy. [email protected]

Rachel sets out a framework for facilities managers to get an holistic view of how assets are performing, which is equally important for both private and public sector asset managers. This article complements one by David Bentley of CIPFA, also in this issue.

Real estate (RE) and facilities management (FM) professionals will be faced with a whole host of operational decisions every day, but more and more strategic choices that drive the business’ overall objectives require data to support decision making.

Specifically, the key decisions in FM and RE are as follows:

ll How does the asset base support the business’ objectives?

ll What is the return on investment (RoI) from the asset base?

ll How big does the asset base need to be to support business functions?

ll What are the big risks for the asset base and how likely are they to happen?

ll When do the cost, performance and risks of the asset outweigh its value?

ll What investments need to be made to mitigate risks?

ll When are acquisition and disposal decisions required?

ll Where should new assets be based?

There are some key metrics (see Table 1) that can prove useful in decision

making, regarding the need to maintain, acquire or dispose of space and help transform work cultures. Both RE and FM professionals have a significant impact on the overall success of the organisation – particularly now as the connection between wellness and productivity has begun to be widely recognised by employers and the costs associated with poor mental health are increasing. The workplace and the associated strategy can potentially have a positive effect on the workforce’s quality of life.

Metric 1: Space utilisation

The underutilisation of space represents an avoidable cost for businesses.

Regulation 10 of the Workplace (Health Safety and Welfare) Regulations 1992 states that, with regard to room dimensions and space requirements: “every room where persons work shall have sufficient floor area, height and unoccupied space for purposes of health, safety and welfare”. The associated Approved Code of Practice and Guidance goes on to state that: “the total volume of the room, when empty, divided by the number of people normally working in it, should be at least 11 cubic metres”. The Health and Safety Executive says: “in making this calculation, a room or part of a room which is more than 3.0m high should be counted as 3.0m high”. This does not easily translate into a sq m/workstation metric.

The Government Property Unit (GPU), however, has an overall goal of achieving 8 sq m/full-time employee (FTE) as part of its office rationalisation programme, which will establish 20 multi-regional and multi-use hubs that will have a positive impact on 270,000 central government staff in The State of the Estate in 2014–15 (http://bit.ly/28SJ2O6). The GPU achieved the 10 sq m/FTE in 2015 and has established 8 sq m as its challenge for 2016 and onwards. The GPU, in addition, is changing its business processes to enable and encourage more flexible approaches to working. It recognises the positive impacts upon mental health of employees of not having to follow a traditional 9-till-5 office based work pattern that typifies white collar work of the last century.

Metric 2: Cost of occupancy

Often, the location and quality of a property is an investment in brand that is intrinsically linked to the return. However, using RoI alone as a measure, then poor-quality, cheap and uncomfortable space can prove just as productive if the team has a positive/strong working culture. The cost of occupancy must be understood in the context of how well the space is used and the RoI it represents for metric 4, rather than considering it as an isolated operational cost.

Control of occupancy costs does not simply


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involve a blanket reduction of operational services, but tailoring them to ensure that each building or asset has sufficient provision, according to the frequency and intensity of use and the associated statutory compliance requirements.

Metric 3: Safe, comfortable and compliant

The building should be both physically safe and secure, with clear circulation space and secure entrances, as well as complying with relevant regulations. The level of statutory compliance achieved at any one time will directly relate to the maintenance strategy and the level of occupancy costs identified in metric 2. Low levels of statutory compliance start to represent high levels of backlog maintenance activities (i.e. those activities that when not undertaken represent an operational risk).

Well-maintained buildings tend to perform well in terms of energy use, while high levels of backlog maintenance typically indicate poor energy performance, irrespective of the age of the property.

The level of cleanliness will directly affect the satisfaction of staff, clients and visitors. It could also have an impact on staff turnover, absenteeism and productivity.

A poorly maintained, shabby-looking building that is energy-inefficient has the potential to be a barrier to business development because it could be seen as evidence of a lack of corporate social responsibility, ultimately leading to a loss of reputation.

Metric 4: Space productivity

Determining what an organisation deems productive depends on the nature of the business and its required outputs. A crude but universally comparable metric is gross profit: the productive output is measured as £/sq m or £/workstation, and then divided by the cost of occupancy, to ascertain the RoI. To increase the RoI, either output needs to increase or occupancy costs need to be lower. The automation of processes and outsourcing often represent an opportunity to achieve these, but focusing on people, processes, systems and data can yield longer-term results.

Metric 5: Location productivity

In 2001, the World Health Organisation said the impact of mental health problems in the workplace has serious consequences, not only for individuals but also for the productivity of the enterprise. In the UK that year, 80 million days were lost due to mental health issues, costing employers £1–2bn. In 2012, the Parliamentary Office of Science and Technology stated that poor mental health in the workplace costs the UK an estimated £26bn a year, with:

ll absenteeism costing £8.4bn

ll presenteeism costing £15.1bn

ll staff turnover costing £2.5bn.

The Oxford English Dictionary defines “presenteeism” as “the practice of being present at work for longer than required, especially as a manifestation of insecurity about one’s job”. In 2013, The Economist stated that working longer hours drains rather than increases productivity, and countries with longer average working hours are significantly less productive than those that work fewer (http://econ.st/28OpmO6). In 2015, the Guardian reported the results of a University College London study finding that a 55-hour week increased the risk of strokes by 33% and coronary heart disease by 13%, compared to those who worked between 35 and 40 hours per week (http://bit.ly/28LUKbY).

Strokes and heart disease are preventable when they are associated with lifestyle choices. This represents an opportunity for RE and FM professionals to have a positive influence on staff at the level of building and location, through the provision of amenities such as proximity to fitness facilities, access to green space, bike racks, lockers and changing rooms, fridges and food preparation areas, choices regarding interior design and, where appropriate, availability of more healthful food options.

Metric 6: Start of the day wellbeing

Measuring commuting times and the speed of journeys is important because if a location is difficult to access it will

be stressful for staff and reduce their productivity at the start of the day. Opportunities to work differently or relocate the workplace nearer to the staff base are potential solutions. If a building location does not depend on specific geographical features – unlike, for instance, in the oil and gas, utilities and water sectors – then assets that are difficult to access could represent a barrier to attracting new talent and existing and potential customers.

Metric 7: Lease life

The overall business strategy should be informed by an understanding of when assets will reach the end of their legal service life or when contracts need to be renewed, as these determine when investments and decisions are required. It also represents an opportunity for change and transformation, especially in working practices that are associated with particular locations – such as late starts or early finishes because of the difficulty in reaching a location – or particular buildings – such as poor energy performance as a result of occupiers’ behaviours.

Conclusion

Achieving the right size for your workplace can be successful when flexible working solutions are appropriately assessed for risk and the right equipment is made available. An intangible but essential element is also the trust bestowed by the organisation’s leaders on those who choose to work away from the primary location. Senior members of the organisation must lead from the front to demonstrate that trust to the staff.

The management consultant Peter Drucker once famously said culture will eat strategy for breakfast, so your workplace strategy must be informed by the cultural norms of an organisation. However, when those norms have a direct impact on the premises’ RoI, there is a compelling argument to transform workplace strategy.

Editor – This article first appeared in the RICS Property Journal, September/October 2016. Thanks to the RICS for giving permission to use it.

TO CPOLICENCE

Roger Moore, Head of LSH’s Compulsory Purchase team, workswith local authorities to deliver infrastructure and regenerationschemes fairly and responsibly. Our services include:

Guidance on site or route selection

Valuation and compensation estimates

Advice on site assembly

Consultation prior to award of CPO powers

Expert witness evidence

Negotiations with claimants

For more information, get in touch with Roger [email protected] +44 (0) 1245 215 543

Licence to CPO.pdf 1 03/04/2017 13:09


David outlines the headline results of its Property Services Value for Money Exercise in benchmarking. It complements the article by Dr Rachel Dicks also in this issue. A full list of the 2016/16 indicators used in the CIPFA Property Services Value for Money Exercise can be obtained from http://www.cipfa.org/services/property/cipfa-property-service-value-for-money-exercise

INFORMATION IS POWER?

FROM SUN TZU

TO SHERLOCK –

BENCHMARKING PROPERTY

COSTS AND PERFORMANCEDavid Bentley David Bentley is Head of Asset Management at CIPFA Property. [email protected]

Sun Tzu, the legendary Chinese general and philosopher, once said “If you know the enemy and know yourself you need not fear the results of a hundred battles.” Now Sun Tzu did live approximately 2,500 years ago, and I’m not exactly sure what his take on the modern world would be, but I would like to think he might just be a firm advocate of benchmarking.

Working in the modern public sector we thankfully don’t see the kind of battles Sun Tzu and his compatriots would have experienced. We do however face a continuing struggle to maintain our services against a background of cost cutting and increasing demands.

So do Sun Tzu’s words still have some relevance today?

CIPFA launched its Property Services Value for Money Exercise 5 years ago in response to numerous requests. The public sector at the time was starting to

feel the effects of the financial squeeze and many organisations were keen to understand if their own staffing numbers and performance were at a suitable level. We were constantly being told of posts being cut and sections downsized, which started to raise questions as to when being economic, efficient and effective went too far, thus becoming insufficient, ineffectual and inadequate.

And this is where Sun Tzu comes in. If you don’t know yourself and how you are performing, then compare this to others and what might be achievable, where does it leave you? The answer is simple: without this information you are in the dark.

Improving best practice through performance and cost comparison is a critical activity in the commercial world. Benchmarking is therefore an essential exercise for any organisation wanting to understand how its costs compare and how it might improve its operational efficiency and effectiveness across the organisation. Benchmarking can provide organisations with hard facts about how their different areas measure up and where and by how much they can improve. In the public sector comparison can also provide evidence when proposed cuts might have too great a detrimental effect on service provision and therefore prevent a costly mistake.

That’s probably enough advocacy for

now on why you should undertake benchmarking, so let’s look at some of our findings so far.

We’ve just published our latest value for money results which cover the financial year 2015/16 and we will be starting the exercise for 2016/17 in May. The exercise is extremely comprehensive including strategic asset management activity through to estate functions, design, maintenance and even the management of energy. We look at staffing costs and procured services, then set this against levels of delivery and performance. Finally each participant has a validation visit to ensure that where possible all inputs are interpreted in a consistent fashion.

General areas

This covers areas such as average salaries, age profiles, sickness and training. As you can imagine, salaries appear to have remained fairly constant with only a slight increase (between 1% and 2%) over the 5 years of the exercise. Total average sickness days however have risen by approximately 40% which may suggest an increase in pressure and resultant stress across the sector. Training levels have always appeared inadequate with 2015/16 recording the lowest average yet, at 1.80 days p.a. for full time equivalent employees (FTEs). Presumably the majority of CPD activity is being undertaken in people’s


own time? Finally for this section the age profile information always stands out, with more than 40% of the internal property workforce being over the age of 50. This must raise significant questions about succession planning moving forward.

Strategic asset management

Strategic asset management is always difficult to gauge, with councils of similar sizes having quite different staffing numbers and makeup. This is often based on how active a council is in reviewing its estate, or sometimes where a particular organisation is playing ‘catch up’ due to under-resourcing over a number of years. Particularly noticeable is that just under a quarter of councils could not provide condition information for their assets, while several others stated that their own information was based on out of date information.

For the first time this year we have started to collect information about office space, with councils seeming to score quite well. The average floor space for individual staff members works out at 7.64 sq m per FTE, and average office space per workstation is 8.73 sq m. Finally the average workstation to person ratio is 0.89 with some organisations achieving as low as 0.60.

Design and construction including project management

While capital programmes’ budgets vary significantly between participating councils, we do seem to be seeing a continuing downward trend in expenditure, the latest average being down just over 50% from 2011/12.

Approximately 50% of design services by value were procured externally with fee levels remaining pretty consistent over the 5 years.

One area which has seen a demise is in the regular collection of project time

and cost predictability information which were once so popular. Less than half of councils could provide this information, although for those that did provide returns, performance against both indicators was generally very good.

Condition surveys

This is one of the areas that really concerns me, with 45% of councils within the exercise not conducting any surveys during 2015/16. Good practice suggests 20% of the estate should be surveyed on a 5-year rolling programme to ensure adequate identification and prioritisation of maintenance need. Only 17% of councils had undertaken surveys of 20% or more of their estate during the benchmarked year.

Management of maintenance

Maintenance expenditure continues to be squeezed tighter and tighter, resulting in an increased need and subsequent deterioration of the local authority estate. The average percentage of ‘priority 1’ (urgent) maintenance works increased by 30% over the previous year. Spend as a percentage of maintenance need came in at just under 17%, a similar drop of 30% from the average of the previous 3 years. We keep talking about a maintenance time bomb which doesn’t really seem to have hit us as yet. However, if these trends continue, and we keep patching up as best we can, it’s surely only a matter of time before something significant goes wrong.

Management of investment and other Tenanted Non-Residential Property

Over two thirds of our benchmarked councils identified an investment estate, which is up from previous years. Income from such assets however doesn’t show any marked increase, although management costs as a percentage of income have reduced. This could reflect councils being conscious of

managing such assets on an increasingly commercial basis.

Councils still have a lot of other tenanted property where investment is not the only reason for retention. Income from such property can still be substantial, However management costs are likely to be proportionally higher when compared against pure investment property. This indeed was reflected quite convincingly in the results of our benchmarking. In 2 instances the costs of management outweighed the income and one would question whether these councils are really challenging this property. Should they be holding onto such assets, or is there a more efficient approach through either community transfer, or disposal by sale?

Conclusions

Our benchmarking exercise for 2015/16 covered 11 different property activity areas and some 113 different data sets. This article therefore only provides a brief summary of what is, we believe, the most comprehensive exercise within local government property services. What I do question though, is how others are collecting and comparing their own costs and performance if they don’t benchmark through this or another initiative.

On many occasions CIPFA Property is invited to carry out some sort of property service review where we find little or no performance data has been collected in several years. This is often compounded by inadequate, clumsy or duplicate systems which hold data, making it extremely difficult to collect such information when it is requested. Further, add the average age of staff within council property services, with many experienced staff getting close to retirement, and you have potential for the perfect storm.

So am I being too alarmist? I honestly don’t think so. The public sector is increasingly under a microscope for

Age Profile Information 2015/16 (Simple average across authorities)

Under 25 25–35 35–45 Over 50

4.39% 14.96% 41.61% 43.25%


both performance and expenditure and if something goes wrong we will be examined in detail and often in the public spotlight. It might just be that we need to understand our true costs of providing services so when challenged we have robust justifications for why and how we do things. It could be much more than this. If we don’t effectively manage information on our estates it could result in costly decisions or some aspect of the building fabric failing because we haven’t picked it up.

I started with Sun Tzu and I will finish with another information fan, namely Sir Arthur Conan Doyle through his Sherlock Holmes stories. Sherlock believed in the necessity of collecting information long before data science became popular, let alone benchmarking. There are numerous data quotes we can extract from the great detective but I will leave you with just this one from A Scandal in Bohemia.

“It is a capital mistake to theorise before

one has data. Insensibly one begins to twist facts to suit theories, instead of theories to suit facts.”

So have you got data? Is it all up to date and relevant? Is it used to manage the portfolio, and do you know how you are performing against others? If not, what are you going to do about it?

More details of CIPFA’s Property Services Benchmarking can be obtained from [email protected].

ESTATE PERFORMANCE – A

CORPORATE RESPONSIBILITY?Merrick Denton-Thompson OBE FLI Merrick is currently the President of the Landscape Institute and has worked across the public sector throughout his career. He stepped down from his position as Assistant Director for Environment at Hampshire County Council to join the Board of Natural England in 2006. He is the Founding Trustee of the Learning Through Landscapes Trust and is a member of the Design Panel for the South Downs National Park Authority. [email protected]

The Landscape Institute is the professional organisation representing landscape scientists, landscape planners, landscape architects and landscape managers. Its members transform landscapes of both town and country; they work across the public, private and voluntary sectors.

Merrick continues the theme of public assets and health featured in 2016/17 Winter Terrier. “There are immeasurable benefits to health and wellbeing generated by the quality and multi-functional aspects of green and open spaces, should we not value such places as primary infrastructure, as important as our hospitals, schools and railways?”

‘Natural Capital’

All of us in the public sector appreciate that there is a symbiotic relationship between wealth generation and public investment and most of us appreciate that for years they were out of balance. Austerity and uncertainty appear to be deeply embedded for the foreseeable future so can this be a catalyst for reviewing the performance of our estates, in particular our landed estates?

Do we hold the ‘client department’ to account in securing a corporate standard to ensure we get the best return for the public we serve?

The lack of political courage in achieving some uniformity to the pattern of local government in England is being overcome by the presence of such courage in the devolved nations. Wherever we are, the potential for land to benefit the public must be under constant review, accepting that not all values can yet be articulated in direct financial terms. The new discipline in town – Natural Capital - provides a framework to begin the task of valuing aspects of the estate not attempted before. The jury is out on how far measuring Natural Capital will go and how effective it will be in transforming our lives and our businesses.

Scoping subjects like clean air, clean water, soil quality and biological health of both town and country is going be challenging. For example for those authorities that have held on to their rural farms, is there a policy of renewing tenancy arrangements that focus on sustainable food production, ensuring that no nitrates are taken up in the aquifers or emit nitrous oxide (300 times worse than carbon as a climate change gas)? Too many of our farms have adopted systems of supressing the power of natural systems rather than harnessing them for food production. Too many are failing to restore soil quality and are not doing enough to restore the biological health of the landscape. Measuring resilience to climate change, not just for the farm business but the potential knock-on effect to our urban environments, is the new imperative. One of the benefits


of Brexit is that for the first time we can work together to secure a more nuanced intervention system to work collaboratively with the farming industry on a new set of standards.

The public estate

The public estate in our urban environments has the greatest potential of bringing real benefits to the public, especially to transform the health and wellbeing of everyone. I will give a couple of specific examples. Take the state of childhood in this country: concerns over fitness, obesity and mental health are constantly in the headlines. Influences on childhood is a complex topic with parental anxiety and social media obsessions being 2 of the main constraints on a healthy childhood.

The public estate has a captive audience to support child development through our schools, but do they stand up to scrutiny? Accepting that we have to put up with mixed messages from the government with the termination of the standards of area provision in the Schools Premises Regulations, announced in the middle of the London Olympics, designed to encourage the development of Free Schools. The unintended consequence was to remove the protection of all 37,000 school grounds. The fact is that by 2020 we will have a million more children in the education system than planned for and we are now building temporary classrooms over our playgrounds.

So what do I mean? For many children whose learning preference is experiential, transforming school landscapes for direct learning can massively improve

attitudes to education. This is where they will make friends for life, so is there a standard of school grounds that actively pursue positive social outcomes? Play is a fundamental part of child development, so do we provide for the complex array of opportunities for children to explore all aspects of play – territorial, imaginative, social, and others? Children’s relationship with the world is enhanced by connecting young people to natural systems, are we pursuing standards of biological health in all our schools?

Outside of the school environment are we adopting quality standards for all our public realm, not just to benefit child development? We can do so much

more for those of us at the other end of our lives – for the elderly or dementia sufferers. Protecting and creating the distinctive and variations in character of places strengthen the sense of belonging. Reconnecting people with natural systems – flowers, birdlife and food growing, making provision for the changing health of our sensory organs, creating outside spaces to encourage meeting and greeting – the list is endless but not enough is being done for this aspect of our lives.

Strategic planning

We all have a corporate responsibility but do we always act on it? For me one of the important tests is to examine the standards we expect of the private sector through our regulatory responsibilities, such as planning, and how they compare with the quality of public spaces we

provide and manage. Spatial planning has been under constant review and change. Our ability to act strategically has been periodically undermined by the loss of strategic planning at county level, and the loss of regional spatial planning in the regions – both because of political dogma. However, there are signs that one day we might revert to a sub-national planning system, at either county or regional scale, where the public can once again share in the profits of land sales. Strategic forward planning was used successfully by local government to plan in the long term, enabling strategic landscape master planning investment that secured much higher land values and protected property values.

Henry Edmunds at Cholderton in a field of Hampshire Sanfoin for nitrogen fixing

Transforming land for health and wellbeing of young people. By kind permission of the Learning Through Landscapes Trust


Forward planning is made that much more difficult on topics like resilience to climate change because we are clearly in a state of transition – will we ever have a stable climate and if we do, where will it settle? In Cumbria we had 300mm of rain in 24 hours that appeared nowhere on the risk register and, following that event, nor does 600mm feature on the register today. Reviewing the way we manage and lay out public land to secure more resilience is a big challenge for us all. As local government is pushed further away from acting at its discretion, because of the rising demands on depleted resources, its ability to respond to emerging issues is considerably reduced. It is not as if we have the necessary skills in central government departments anymore to help us all rise to these new challenges. Gone are the days that local government can respond to new challenges by

expanding its establishment and perhaps we need to challenge the residual staffing left behind from a purely financially motivated restructure - as opposed to reviewing the necessary skills to meet the future challenges we are all facing – all very uncomfortable!

Evolving the structure of the public sector to retain the breadth of strategic skills to meet the needs of society and local communities is an obvious option open to us all. A structure that builds a series of ‘intelligent clients’ in the commissioning of the private sector, has to be in line with the way the current government is thinking! The Landscape Institute and the Chartered Institute of Ecology and Environmental Management are considering a collaborative arrangement by providing back office support and training to a new public appointment to help the public sector transform the land they are responsible for, to meet the needs of those they serve. A post that is empowered to act corporately that focusses specifically on the interface between people and natural systems. A post that will be responsible for managing Natural Capital, building resilience into both town and country,

driving new standards of health and wellbeing of everyone, at the same time as improving economic performance.

At the time of writing this article we have yet to understand the full implications of the government’s proposed 25-year Environment Plan but what is very clear is that the government has to craft a more positive and proactive relationship with local government if it stands any chance of successfully delivering such a plan. Local government is best placed to empower local communities to act, best placed to engage both the voluntary and private sectors in collaborative consortia to secure the changes that are expected to emerge from such a plan.

Social health and stability, economic performance and property values are all directly affected by the quality of the public realm. There are immeasurable benefits to health and wellbeing generated by the quality and multi-functional aspects of green and open spaces; should we not value such places as primary infrastructure, as important as our hospitals, schools and railways?

Transforming land to meet the needs of the elderly

Communities Week 2017: our love for green spaces and why we must protect them

As dawn breaks across England, many local parks – the natural areas closest to where we live – can already be busy. In 2014/15, the Monitor of Engagement with the Natural Environment survey

suggested that there were 887m visits to parks in towns and cities – that’s 26% of all visits to the natural environment and the most visited type of natural area.

Just think of the benefits well managed parks offer, from the more obvious ones as a welcoming place to relax and to exercise, through to somewhere that can

help absorb flood water, as well as being a home for nature and an opportunity to see wildlife.

So how can we recognise those places that are considered to be well managed? One way is to look out for a green flag flying high and proud, which means the park has achieved the Green Flag

PROTECTING GREEN SPACESDavid Solly

This piece caught my eye, taken from the ‘My Community’ Locality website. The blog was a contribution to Communities Week, 20-24 March, hosted by Locality with support of the Department of Communities and Local Government (DCLG), to celebrate communities who are making the most of the rights given to them through the Localism Act 2011 and the tools and mechanisms that exist to support them to do that. I therefore contacted the author, Dave Solly, Valuing the Environment Team within Strategy Implementation, Natural England ([email protected]) who was happy for me to reproduce his blog.

David also said: “I would really welcome hearing of any discussion it provokes among your members which I would share with DCLG colleagues to help us consider whether there is more I or they could usefully add that may be of value to chief estates surveyors, perhaps in a future article.”


Award, the national quality standard for green spaces. In 2016, green flags were awarded to 1,506 places that the Award judges considered had met the scheme’s criteria – which, among other things, consider whether the space is a welcoming place and safe and secure. On 30 January 2017, a DCLG Select Committee enquiry into the future of public parks report recognised that parks face considerable challenges.

The report stated that “as shared community assets, they must serve many different purposes, and be able to respond to the different and sometimes clashing needs of local communities. They must compete with other services for investment to secure their short and long term sustainability.”

The Committee acknowledged that not all the solutions are for local authorities and policy makers to deliver alone; it recognised that meeting these challenges will require responses on many levels, and that communities have a role to play, whether through friends, volunteers, or other local groups. Many parks have friends groups, local people who help to look after their park; in some, such as Millennium Greens and Pocket Parks, it is local communities that deliver everything the space offers. Over 150 parks and green spaces are currently registered as Assets of Community Value, places that local people have identified as important to their communities. And the 241 Community Green Flag Award winning sites are all managed by local communities. Local people can – and do - make a real difference.

Getting involved and making a difference doesn’t have to mean a huge commitment – for park managers, the support of local people is invaluable, whether that is by looking after its natural areas or by simply acting as their eyes and ears, letting them know what they have seen that needs fixing during their daily walk.

To find out more:

ll Contact your local authority for details of local teams

ll Look on the internet for friends groups

ll The ‘Love Parks’ website includes a find a park and friends group.

THE 2017 MODEL

ESTATE REPORTCatherine Penman Catherine is Head of Research at Carter Jonas. [email protected]

The 2016 Model Estate report has been featured for a number of years, lastly in 2016 Spring Terrier. Catherine here summarises the findings for 2016. It provides useful performance trends for asset classes typically managed by many local authority surveyors, and some interesting comparisons against other investment types. Interestingly, there appears to be less adverse effects from Brexit outside the main cities.

The 2017 Model Estate Report

The ‘Model Estate’ is a theoretical agricultural estate which Carter Jonas formed in 2010 in order to monitor and compare the performance of agricultural

land against a variety of assets classes: residential and commercial property, equities, gold, fine wine and classic

cars. The estate comprises 3,168 acres which includes a combination of let and in-hand farms, a commercial and

Model Estate Performance

72.5

0.0 5.1 4.720.7

4.2 5.6 3.3 3.8

235.3

41.8

6.6 5.5 4.9 4.7 3.3

-1.6 -2.7

-50

0

50

100

150

200

250

Other Commercial Total Estate (excl Manor)

Total Estate Residential Let Farms Total Estate (excl

Commercial)

In Hand Farms

In Hand Farms - excl

manor

Perc

ent

2015 2016

2015 versus 2016


residential portfolio, a telecoms mast, fishing rights, a syndicate shoot and a solar farm. It is located within the geographical triangle bounded by the M4, M40 and M5 motorways.

Model estate performance

All findings in this report are based on valuations undertaken on 31 December 2016. The model estate was valued at £40.7m as at December 2016, an increase of 5.5%. This compared favourably to the 4.7% achieved in 2015.

The commercial element produced an impressive growth rate of 41.8% in 2016, following active commercial management and regearing during the year. The rural office sector has improved considerably over the last 12 months, with increased demand for both office and storage space recorded, which has led to rental increases, longer lease terms agreed and less incentives being offered. In contrast to the central London and principal regional office markets, the Brexit referendum vote has had a minimal impact on the sector with requirements for secondary quality investments with a potential for redevelopment strengthening during the second half of the year.

The estate owners have continued to focus on diversification, following the successful letting of the sporting rights during 2015. The “other” element of the model estate enjoyed another buoyant year of performance in 2016, increasing in value by 235.3%. This was principally

due to the estate entering into an agreement with a renewable energy developer to lease 25 acres of Plant Farm, a let farm, for a solar facility.

The value of the estate’s residential portfolio increased by 4.9% during the year. Both capital and rental values rose, in line with the improved sentiment throughout the UK, particularly within the rural lettings market. Uncertainty surrounding future house price growth continues, fuelling demand for rental properties, and affordability remains a key restraint for young purchasers.

After a bull run of more than 8 years, the agricultural land market has peaked in terms of performance and values have slipped over the last year. This market correction has inevitably had an impact on the model estate, with the in-hand farm element witnessing a -1.6% decline in 2016.

The manor house had a positive impact upon the in-hand farms in 2016. When the house was included, capital growth improved to -1.6%, compared to -2.7% when it was excluded. While the land market has performed strongly in recent years, the manor house has proved a drag on performance. Now that the market is entering into a new phase of the cycle, it has bolstered the 2016 performance figures, confirming the advantages of a multi-asset estate. The -1.6% decline was predominantly due to a reduction in land values, coupled with a reduction in net income of the in-hand element, of 37% during the year. As a

result, the estate owners are considering options for the in-hand farming element over the medium-term.

Let farms recorded a 4.7% increase in value during the year, wholly driven by a rise in the value of the houses and cottages, with agricultural rents remaining static as no lease renewals occurred. This has reflected an increase in the demand for residential property on farms and in rural locations, acting as a hedge against falling agricultural land values.

The model estate’s 5.5% growth rate reinforces the diversity of its various components. The installation of the solar park and the review of the commercial portfolio boosted the overall value, as the land element saw a reduction in performance.

The model estate versus alternative asset classes

As an asset class which has seen negative or mildly positive annual growth over the last 5 years, fine wine performed exceptionally in 2016 to take pole position in this year’s rankings. Growing by 23.8% during the year, values steadily increased month-on-month. However, the sustainability of this prolonged period of steady growth is questionable, particularly because the volatility of the currency markets is likely to impact the value of the European brewed wines included in this index.

The FTSE All-Share Index expanded by 15% annually in 2016. With its closing value as at the end of December 2016 the highest monthly value since records began, equities ranked second against the model estate and alternative asset classes. Following the announcement of the UK’s vote to leave the EU, equity prices soared in July, before continuing to rise steadily in the proceeding months. Equities continue to be the most volatile asset class analysed. Over a 3, 5 and 7-year period, average annual growth stands at 3.2%, 6.3% and 5.0% respectively, and with Brexit negotiations on-going for the next 2 years, these unpredictable movements are expected to continue.

Classic cars continued to show positive

Model Estate versus Alternative Asset Classes

23.8

15.0

9.58.3

5.54.2

-1.1

-5

0

5

10

15

20

25

30

Fine Wine Equities Classic Cars Gold Model Estate MSCI Residential MSCI Commercial

Percent

BUT WITH A WIDE RANGE OF SERVICES AND OVER 700 PROPERTY EXPERTS WORKING TOGETHER WE CAN OFFER SIMPLY BETTER ADVICE.

SOME SEE ONLY A SINGLE SET OF SKILLS

020 7518 3200 | carterjonas.co.ukOffices throughout the UK offering Simply Better Advice acrossRural, Residential, Commercial, Planning & Development


growth; however, the overall growth rate has slowed considerably over the last 5 years, which indicates some caution in the market. The price of gold increased by 8.3% during 2016, taking prices back to levels seen in 2014, following a contrasting 2015 where they fell by -9.1%. Volatility is evident, with growth in 2016 exceeding the asset’s longer-term performance. Prices fell on average by -0.8%, -4.2% and -6.8% annually over 2, 3 and 5 years respectively, while growing by just 0.3% over a 7-year period.

The UK’s residential sector ranked 6th overall, recording a 4.2% annual growth in capital values in 2016, down on the 6.4% and 7.2% achieved in 2015 and 2014 respectively. Capital growth was driven primarily by rising rents, which increased by 1.3% during the year, although this was down on previous years. House price growth moderated in 2016, particularly in Greater London and UK’s regional cities. Prime central London performed below expectation, with capital values falling by -5.9% during the year, according to Carter Jonas’ PCL index. The market was heavily impacted by the introduction of the 3% stamp-duty surcharge on second

home purchases, but also, like the rest of the country, because of uncertainty surrounding the Brexit vote.

Average capital growth in the UK’s commercial sectors fell by -1.1% in 2016, falling to last place in this year’s rankings, although differences between the sectors were apparent. Industrial property was the only sector that saw capital growth increase, by 2.0% annually, while the office and retail sectors saw negative growth of -1.7% and -3.3% respectively. Retail was especially hit, due to weaker performance of supermarkets and retail warehouses nationally, while central London offices saw prices soften somewhat after reaching its peak during 2015. The rates revaluation in April 2017 is likely to impact occupiers in central London, and we may see firms relocate some functions of their business to commuter towns, where rents, business rates and service charges are markedly lower.

Outlook

The pricing correction of the land market was inevitable after such robust growth for a number of years,

at a time when other property sectors were recording negative performance. While we consider the pricing change to be a correction rather than a cliff descent, it may be sometime before the land market finds it traditional cyclical pattern again.

A number of cooling headwinds following Brexit, including the unclear subsidy regime and uncertain trading arrangements, face the UK’s farming industry. Despite Article 50 being invoked on 29 March 2017, future subsidies will not be confirmed until at least 2019. The date of the next UK General Election may well be imminent at the same time, adding a further dimension and complexity to the debate.

Consequently, the model estate owners plan to conduct a comprehensive strategic review to ensure its continued viability. This will include a complete appraisal of all elements of the estate, highlighting opportunities for further diversification and, more significantly, identifying any key threats and restraints.

FIXED ASSET VALUATIONS –

ARE THEY WORKING FOR YOU?Margaret Wells

Margaret is the Head of Estates at Concertus Design & Property Consultants. Based in Ipswich and with a focus across the eastern region and south east, her team of experienced chartered surveyors provide support and advice to the public sector on all estates matters. Margaret has recently been awarded a CIPFA Certificate in Asset Valuation. [email protected]

At last, a useful article on valuation which not only explains the Depreciated Replacement Cost approach, but also outlines the real benefits of using that important source of data in asset management.

A question

I am writing this at the end of March and as we close another financial year I wonder how many public authorities make the most of the work that goes into the provision of fixed asset valuations? The annual cycle of these

valuations is such that, as you are reading this, you will probably already be thinking about March 2018. This article aims to set out our experiences of the Fixed Asset Valuations (FAV) process and how the opportunities this work provides can be maximised for the benefit of our clients.


CIPFA continues to demand criteria for quality asset valuations to enable RICS Registered Valuers to deliver reports that fully support the accounting function. The observations that are recorded within the asset valuation preparation may well become lost, if the focus is restricted to the delivery of figures for the accountants.

The design and use of many public-sector buildings is sufficiently different from the commercial norm that these assets cannot be valued by the conventional comparison method of valuation. In many cases specialist buildings need to be valued using a Depreciated Replacement Cost (DRC) approach.

Steps in the DRC approach

The DRC approach is focussed on providing an asset which can support the current service, rather than a replica building. So, step one is to understand the needs of each public-sector service, which typically means a liaison with service providers and their management hierarchy. This information can be enlightening and highlight a significant gap between the ideal property and the reality of the current building. For the DRC valuation, an obsolescence score is determined within agreed parameters. A record of this data could usefully contribute to a strategic review, to determine where the least suitable buildings are located, or to observe and replicate the better assets. Maximising the consistency of the valuer’s approach, will provide added benefit for future asset management.

A second step within DRC is to assess the remaining useful life of an asset. This does not mean simply the physical life of a building. Instead the figure incorporates the economic life of the asset in its present use. The suitability of the location, building design, any restructuring of the service, and physical condition all need to be considered together. If an asset comprises several buildings, the overall life may be curtailed by the oldest part, or the lack of cohesion between the blocks. At Concertus we often regard the maximum useful life of a brand-new building to be 60 years, depending upon

the building type. This reflects the high level of capital expenditure required to keep a building in a condition suitable for operational use. The accountants use the estimated life of a building to depreciate the building element of the asset valuation. The data ought to be another key factor to asset management planning outside of the accounting arena.

An important element of the DRC valuation is the concept of the modern equivalent asset (MEA). This challenges the valuer to articulate in numerical form, the most cost-efficient way to provide a particular service on the valuation date. For example, for schools, this means interpreting the most recent Building Bulletin, which provides design size guides for school buildings and playing fields, based on pupil numbers.

It would be interesting to note how many local education authorities, and property teams hold up to date information on which schools currently meet the Building Bulletin capacity thresholds. With the constant drive for new housing stock and consequent need for new school places, it would be refreshing to think that the data calculated for fixed asset purposes could support forward planning for school places, especially in areas where significant new residential development is foreseeable.

Vacant accommodation is excluded from all asset valuations, in accordance with the MEA principle. A summary of this information can support and enhance the ongoing quest to use assets effectively, particularly when seeking to merge services, reduce overall running costs, and reap capital receipts.

The International Financial Reporting Standards introduced the concept of component accounting. This means that any part of a building which represents a high proportion of the overall cost of constructing the building, and has a different useful life to the structure or host element of the building, must be recorded separately. This concept has created much angst since its introduction in 2010, as minimal guidance was given on how to interpret the accountancy rules. My observation is

that creative thinking on this topic tends to raise more questions than answers, among both accountants and property professionals.

The more cautious the view on auditor’s requirements, the more work can be created for property professionals. While attending a recent CIPFA event, top marks were on offer to local authorities who adopted a high threshold for the trigger for component accounting. So less could be more for the accountants, valuers, building surveyors, quantity surveyors and clients too. If it is accepted that only a small proportion of a total portfolio requires component accounting work, then everyone can enjoy a saving of time and money, and focus energy to where it can make a real difference.

Reading condition surveys as part of the FAV process can highlight significant cost responsibilities that can also be used to trigger strategic reviews, and property management decisions. Improving our understanding of an estate is fundamental to ongoing successful management.

Compliance with the RICS Red Book dictates that properties are inspected. A surveyor’s visit can support future strategic reviews and day to day property management work, for example, by building relationships with occupiers, plus capturing boundary or repair issues, and any gaps between the design aspirations and the current use of the property. As an asset valuer, meeting building users is an interesting way to observe the building manager’s view of other property services that they have received. Good news can be celebrated, and problems captured in real time, which is frequently appreciated.

Spin-off professional work such as insurance valuations and rating assessments can be achieved with much of the same data, provided the estates team works together collaboratively, and records data in a consistent way. Within Concertus we have experienced that the common goal, of ongoing quality improvements, blended with a profit motive, and a strong team spirit, can harness good ideas, and make them work for clients.


The land and building split is very much regarded as an accountancy requirement only. However, if the land value is obtained via a residual approach, or from comparable evidence, the % of the total asset value in the land element can be an interesting observation beyond the realms of asset valuation. Future asset management goals could well be supported by observing the % of the total asset value attributed to the land. The higher the land %, the more likely the building is to be obsolete, and this can be a useful filter from which to make further investigations around property disposals and replacements.

At Concertus we take a broad approach to our residual land values. We group the locations where asset valuations are required and carry out residual and comparable valuations for each group. This ensures consistency within the valuation team. Several surveyors engage in the residual valuation task, and this provides an opportunity for professional discussion, shared learning, and cohesion within the team. The Concertus tone of the list has also become a useful benchmark to enhance the annual impairment certificate, and other high level feasibility studies. We have created a source of local property data, which demonstrates trends in the property market, and gives the required

assurance to the accountants and auditors.

In summary

FAVs require a blend of skills that good estates surveyors can embrace for a much wider purpose, creating efficiencies and cost savings along the way. Appreciating and capturing the positives provides demonstrably better outcomes for local authorities, and at Concertus our aspiration is to maximise our quality of service. We are well placed to grow our strategic offer to clients, and welcome the opportunity to embark on new portfolios of asset valuations.

DISTRICT ENERGY SCHEMES

– AN OPPORTUNITY FOR

LOCAL AUTHORITIES Peter Mason Peter is a Managing Associate in the Real Estate team at law firm, Addleshaw Goddard, becoming a Partner from 1 May. Peter combines his focus on development and regeneration projects with leading the firm’s Energy Real Estate team. This sees him advising developers, funders, investors and landowners across a range of energy generation and distribution projects alongside, and sometimes part of, his work on urban regeneration schemes. [email protected]

Peter outlines the opportunities – and some of the practicalities – of local authorities embarking on providing, with partners, district energy schemes. Government funding may be available in 2017.

What is a district energy scheme?

District energy schemes use a central energy centre which can produce heating, cooling and power to be distributed via a network of pipes and cables to buildings connected to the district energy network. Most schemes will include a combined heat and power (CHP) plant within the energy centre. This is sometimes supplemented with chilling technology where connected buildings also have a cooling requirement; this is known as 'tri-generation'.

Such schemes come in all different shapes and sizes and can range from a few connected buildings within a

particular development to a wide range of commercial and/or residential premises connected across an entire city, and anything in between.

An obvious solution

Mitigating the effects of climate change, improving energy security and driving down the cost of energy (both eco-nomic and social) is an increasingly important issue for policy makers on a global, European and national stage. Decentralised energy schemes such as district energy networks can be part of the solution as they can provide cost-ef-ficient energy, using more sustainable technologies and improving energy security.

However, currently only around 2% of heat in the UK is supplied via heat networks, one of the lowest levels in Europe. This is in the context of almost half of the final energy consumed in the UK to provide heat, and around 57% of this used for space and water heating in homes. There is clearly potential in the UK to use district energy schemes as a way of helping the UK meet its binding carbon reduction targets.

Encouraging district heating schemes

Local authorities can take a leading role in encouraging the development of district energy schemes, including by proactively bringing forward city-wide schemes in partnership with district


energy scheme developers, operators and other stakeholders.

However, the government's economic and commercial analysis has shown that early stage development support alone will not bring forward the large amounts of capital investment required to see district heating network infrastructure being constructed.

Following a period of consultation, the Department for Business Energy and Industrial Strategy (BEIS) launched the Heat Networks Investment Project (HNIP) in Autumn 2016, with an aim to increase the volume of district heat networks being built, deliver carbon savings and to help create the conditions necessary for a self-sustaining heat network market to develop.

HNIP has total funding of £320m to be delivered over 5 years, which the government calculates will bring up to £2bn of additional capital investment. A £39m pilot scheme aimed at local authorities and other public sector bodies has recently closed for applica-tions but the pilot is intended to inform the design of the main scheme, which is expected to open later in 2017 and run for 4 years.

The pilot scheme included the following eligibility requirements and so there are likely to be similar requirements for the future phases:

ll the scheme must be an efficient heating and cooling network in En-gland and Wales (including those that generate electricity)

ll the funding should be required to:

l{ build a new heat network

l{ expand a heat network

l{ refurbish and interconnect an existing network (including works to access recoverable heat or upgrade heating sys-tems), or

l{ commercialise phase costs

ll the network must generate heat either from at least 75% gas, CHP or from 50% renewable, recovered

heat or a combination

ll the heat network must meet the technical and customer require-ments (including CIBSE ADE Code of Practice CP1:2015, Heat Trust, metering and billing regulations) (Chartered Institution of Building Services Engineers)

ll the heat network must demon-strate carbon savings and provide heat at a price no greater than the alternative

ll the applicant must be able to pro-vide evidence of a funding gap at full application and pass one of the additionality tests.

The additionality tests are:

1) Economic/financial additionality route (for new networks): The sponsor could not raise the capital, and/or the project financials (i.e. internal rate of return), while positive, are not attractive enough to enable funding on the open market or through other available means alone

2) Technical/commercial additionality route (for existing networks): Funding for additional technical or commercial features where capital cost is currently a barrier to deployment.

How else can local authorities encourage increased uptake?

Local authorities also have other ways at their disposal to encourage the devel-opment and use of district heating/de-centralised energy schemes. Many local authorities have altered the way they use their planning powers so that they now expect property developments to contain some renewable or sustainable generation. The London Plan, for exam-ple, has an expectation that 25% of the heat and power used in London will be generated through the use of localised decentralised energy systems by 2025 and so it requires boroughs to develop proposals to establish decentralised en-ergy networks, and requires developers to prioritise connection to existing or planned decentralised energy networks where feasible.

While there are challenges in delivering

these types of schemes, local authorities, developers and other stakeholders are seeing the benefits they can bring in terms of achieving environmental stan-dards such as the Code for Sustainable Homes, BREEAM and LEED (Leadership in Environmental Energy and Design), plus more energy efficiency and lower carbon emissions. Some are going further and setting up their own Energy Services Company (ESCos) to run the schemes, providing an additional revenue stream.

Key issues to consider

In our experience of advising on a range of district energy schemes, we have had to address various issues that can com-monly occur on such projects. By giving adequate consideration to the struc-turing of district energy schemes and engaging with developers, operators and other stakeholders at an early stage in project development, it can avoid unnecessary delays and costs later in the project.

Common issues to consider include:

ll complex issues around requiring tenants (especially vulnerable/social housing tenants) to take heat and/or electricity from the ESCo

ll convincing tenants that supply of heat/hot water is reliable and cost efficient. The perception and the reality of having a real alternative to the system being down or com-fort that robust remedial arrange-ments are in place is key

ll how best to deal with counterparty risk, both in terms of the ability to pay and assurance that there will be long term demand

ll ensuring system resilience without costly over-engineering

ll synchronisation between the de-velopment of the network and ca-pacity reservation (since of course someone will have to pay for heat even if there is no tenant in situ).

Some further challenges new devel-opments face will be because they are connecting in to older schemes which, sometimes, were not designed with ex-


pansion in mind. That creates technical and practical issues such as the ability to lay pipes and cables, and reduced efficiency where the energy centre is sit-ed far from the demand, with the result that heat is either lost or unusable.

However, a well-designed scheme can be more environmentally sustainable and more cost-efficient than using con-ventional gas or electricity, can provide long term energy security to tenants and also offer investors an attractive

long term investment opportunity.

By developing such schemes with part-ners at a city-wide level, local authorities can take the lead in facilitating a more coordinated and efficient approach to energy generation and consumption within its locality. It can also directly benefit local authorities by reducing their own annual energy costs, if their buildings are connected to such net-works.

PROPERTY FRAUDOwen Talfan Davies

Owen is a Partner in Real Estate Litigation – [email protected]

There are 3 common types of fraud in the property industry which you all need to be aware of:

ll The imposter fraud

ll The development fraud

ll The cyber fraud.

The imposter fraud

The imposter frauds, as I have coined these cases, all concern high value residential property in central London. There have been 3 cases in 2016. All of them involve unmortgaged property owned by sole proprietors, and all were subject to letting agreements.

What happens is that the fraudster ascertains that a property which is vacant or to let is also unmortgaged. He takes possession of the property and then either he or an accomplice will change their name, by deed poll, to the name of the sole proprietor. They will then instruct a solicitor to sell the property for them. Because

the fraudster is in possession of the property, prospective purchasers are able to view, and if they like it, a purchase can be negotiated. On the day of completion, the purchase monies disappear abroad and the victim is left not owning the property (there being no valid completion), and obviously losing a considerable amount of money.

All the 3 cases referred to below concern the victims suing their conveyancers and/or the vendor’s conveyancers. Liability on the part of the professional advisers depends on the circumstances of the case, although in the most recent case the Court has indicated that liability should rest with the insured advisers and not the insured victim.

ll Purrunsing v A'Court & Co (a firm) & Anor [2016] EWHC 789 (Ch) – pur-chaser’s and vendor’s conveyancers sued by, and held liable to, victim (for breach of trust)

ll P&P Property v Owen White & Catlin LLP [2016] EWHC 2276 (Ch) - estate agent and vendor’s solicitors sued by victim, neither held liable, subject to appeal

ll Dreamvar (UK) Ltd v Mishcon de Reya & Mary Monson (note: judgement given on 20 December 2017 after the conference) - both

purchaser’s and vendor’s solicitors sued, purchaser's solicitors held liable for breach of trust, but claims for negligence against the purchas-er's solicitors and all claims against the vendor's solicitors failed.

All property owners need to be aware of this sort of fraud.

The development fraud

There have been quite a few cases of development fraud, and can involve student accommodation, hotels or any form of land development. Usually overseas buyers are targeted. The fraud operates by selling leasehold units in the completed development to the buyer, who will be asked to pay a considerable amount of the purchase price upfront to forward fund the development. A sham construction contractor is put in place, and the purchase monies disappear, leaving the buyer with a low value interest in a plot of undeveloped land.

The cyber fraud

This type of fraud is not unique to the property industry. Recently one of my colleagues, acting for a buyer, received an e-mail on the day of completion of the sale of a property. The e-mail was purportedly sent to her by the vendor’s solicitors, and gave the account details

This is the additional part of Owen’s presentation at ACES Annual Meeting held at the offices of fieldfisher on 18 November 2016. It takes account of a decision in the Dreamvar case which was still awaited at the date of the conference


into which the completion monies were to be paid. However, she noticed that there was a slight difference in the sign-off on the solicitor’s e-mail address to e-mails she had previously received, and she telephoned the vendor’s solicitor to verify the account details.

It transpired that the vendor’s solicitor e-mail had not originated from the practice, and it became clear that a fraudster had hacked into the vendor’s solicitor's account, had been following the transaction through to completion date, and had sent the e-mail in an

attempt to snaffle the completion monies.

A cautionary tale to be vigilant at all times.

A DECADE OF THE

DEMISE OF THE RETAIL-

LED REGENERATION CPO

– A TALE OF UNREALISTIC

EXPECTATIONS – PART 2Stan Edwards Stan, a Chartered Surveyor, is a Director of Evocati Consultancy specialising in CPO proces. He was formerly Vice-Chairman of the Compulsory Purchase Association and is now an Honorary Member. He worked on town centre retail and project managing CPOs over 40 years at Cwmbran Development Corporation, Land Authority for Wales and the WDA. [email protected]

The intervention by government funding fed, retail led, regeneration CPOs throughout the last decade and before leaves a legacy of many completed but half let retail schemes. This is part 2 of Stan’s forceful opinions of the reasons for failure, case studying Newport in South Wales.

Friars Walk, Newport – the story so far

The 2016/17 Winter Terrier outlined the principles and history of retail-led regeneration in South Wales towns, and set the scene for the case study of Newport, including the CPO; the developer, Modus Corovest (MC); discussions with Newport City Council (NCC) concerning tenants and potential relocations of occupiers of the main shopping area of Commercial Street; the Iceland court case in 2010 and the principles that were defended. “No one thought to ask where all that required spendable income was to come from as well as considering the demographic profile to achieve it – really challenging the needs test. Hold that thought!”

What was obvious over time was that the promoters of the scheme seemed more interested in improving Newport’s

ranking as a shopping centre, having expressed in the media concerns of Newport’s lost ranking to nearby Cwmbran. The Judge in the Iceland case noted that a significant percentage of the floor space was 'pre-let'. A number of companies affected by the CPO vacated the premises which they occupied.

The Modus wheel comes off

In May 2009 the financial viability of Modus was in doubt. NCC met with MC who informed the council, among other things, that the scheme was undeliverable in the current economic climate and that Modus Ventures was about to go into administration, which eventually happened. Also, the development agreement between NCC and MC was due to expire on 31 July 2009. MC wished to take forward a smaller-scale project and associated cost but it would require extensive

evaluation. The council was advised that such a scheme would be a significant departure from the tendered scheme and breach EU procurement rules.

Notwithstanding this, NCC’s Cabinet was quite up-beat but the impact of the credit crunch hit hard and funding opportunities diminished, with investors severely affected by banking funding difficulties and the economic downturn. NCC still argued that the mixed use redevelopment scheme envisage by the CPO was effectively well placed to proceed other than for the critical issue of available funds. The NCC Cabinet was advised that the essential elements of the large-scale redevelopment set out in the original brief and the statement of reasons put forward at the CPO inquiry was still in place. Having regard to an extant planning permission and based upon the level of pre-lets previously agreed by Modus, NCC members


were also satisfied that there is a continuing demand for this type of redevelopment. Also, the acquisition of the land interest under the CPO would effectively "de-risk" one of the major elements when the council re-tenders the scheme. In these circumstances the NCC Cabinet was advised that the appropriate way forward is to offer the city centre development scheme as an opportunity to the market. Hold those thoughts!

In the intervening period (2007-2009) NCC proceeded with the CPO, the argument being that it was the promoting authority and could take on the acquisition itself with a new developer chosen to deliver the scheme. At the GVD stage Iceland challenged the purpose of the CPO - dealt with in the previous article. In layman’s terms the upshot of the Iceland decision was that if Newport CC marketed the scheme on the same terms as those negotiated with Modus, the CPO should be upheld. According to the Judge, the scheme envisaged by the CPO remained viable even if the development agreement with Modus was not deliverable due to the financial circumstances of that particular company and the prevailing economic climate at that time. He accepted the NCC submission that the scheme was not financially viable on the basis that the developer funded the scheme in its entirety, but NCC intended that the scheme which is presented to the market should be funded, at least in part, from sources other than sources

provided by the developer. Hold that thought too!

Same horse, new jockey - Queensberry

All seems hunky-dory as far as the conventional wisdom of noughties retail regeneration is concerned. NCC did indeed remarket the scheme and Queensberry Real Estate, the developer, won the bid with a scheme anchored on Debenhams and leisure facilities. By this time M&S had successfully moved to Newport (Spytty) Retail Park and Boots decided to stay secure in Commercial Street. M&S also succeeded in realigning M&S customer spending patterns, firmly establishing within Newport, but providing a more convenient wide range to customers previously shopping in Cwmbran, Cribb’s Causeway and Culverhouse Cross. This added to the Spytty magnet. There was however a problem with Friars Walk. When it came to the crunch Queensberry could not get market funding for the project. This should have started alarm bells to reconsider the project and the delivery mechanism. NCCs solution was to apply for a £90m Public Works Loans Board loan to pay Queensberry to deliver the project. The exact relationship between Newport and Queensberry in this respect is not known but they gleefully proceeded.

Cost/revenue factors?

CPO costs (acquisition and administration) are always a problem but the prime driver in retail is revenue (demand). That has been the niggle all along – where was/is all that spending power going to be captured from? Perhaps in a situation such as a new town where a phased retail facility grows with the population, it is acceptable but as we have seen with Cwmbran, the town centre became so successful that it impacted on town/retail centres way beyond its boundaries.

The delivered scheme

These are important now, as is the sequence of events leading up to the present status. Friar’s Walk opened in November 2015 with a ‘rolling’ opening. At the time of writing (April 2016) the picture (Fig 1) shows a block

of unoccupied units to the rear of the main Mall which itself has vacant units within it. It would also seem that the mix of users has also changed from that originally conceived [Ed – I believe the situation is little changed today].

Reflections - macro masked micro

I leave the reader to decide how the finished development aligned with the CPO struggling with the compelling case in the public interest and that a reasonable prospect that the scheme would proceed. Actually it could have failed way back because it has produced a pretty monolithic structure with half-filled shops, a plethora of existing vacant shops, with still the same hovering reputation that gave Newport its low ranking. The blinkered plan was to build the edifice of Friars Walk. Debenhams came but a much scaled down version of people’s expectations, some other multiples, along with new modern restaurants and coffee bars forming a destination leisure enclave (Fig.2). M&S even returned to operate a M&S Food Hall but the aspirational shopping mall fell, unsurprisingly, short with unlet units in a Marie Celeste of a retail centre. Admittedly there was the expected pre-Christmas flurry with a curiosity factor, but as William Rushton once said, “a thing of beauty is a joy for two weeks.”

The argument made for the restaurants was that they would cater for Admiral Insurance office staff following its opening in the city. However, what was not assessed - by moving from the original ‘pie in the sky’ mix was/is the impact of a rebalanced centre on all the businesses that now have to enter in the competitive arena or compete even more. This was the case for all those eating places out of centre that suddenly have unexpected competition due to the changes in the Friars Walk delivery mix. A lesson to be learned is the dangers of intervention (interference) in the competitive retail/leisure market, such malls are paved with good intentions. Based on mid-noughties’ understanding, the Inspector at the CPO Inquiry concluded that there was a compelling case in the public interest which outweighed the private loss arising from the expropriation of the land and rights

Fig 1

Fig 2


sufficient to justify the interference with human rights. What now?

The promoters of Friars Walk concentrated on the macro effects in the economy, believing that a downturn would eventually be followed by a corresponding upturn. What actually happened was that the market (including the funders of retail development) were beginning to see the dynamics of failure in town centres plus the changing pattern of retailing itself in global macro, masking multiple micro retail changes and impacts. Queensberry itself found that the market would not fund the scheme.

I am not against retail development but many are coming to the same conclusions as me in that the assessments of the immediate past were grossly inadequate. Friars Walk, and other schemes, have shown that it was

relatively simple to deliver a scheme that should have failed at many points on its development journey, only to produce a centre with units poorly let with sparse customers. The question to be asked by anyone assessing a retail development has to be where the spendable income comes from – captured locally or some innocent external centre. It is a question of public interest that is only realised when the impact is felt. This puts a great pressure on planning inspectors both at the development plan stage and when a compelling case in the public interest is considered. For those genuinely interested in producing a retail scheme, the developer has formally attempted to think like a tenant. To ensure long-term success is the ability to think like a shopper.

A long-delayed dawn

I believe that global macro masked the changing retail market in the noughties with out of town and the convenience of internet shopping. Whereas schemes like Friars Walk blamed the crash for the changes in its fortunes and are waiting for a new dawn (global/national macro upturn) the problem is that the market

itself has changed and retail in town centres may be in for a very long night.

The retail litmus test

If a retail scheme, which of necessity should be market-orientated, has to receive public funding to make it happen, it causes the grim reaper to arrive with the non-market funding. Projects of intervention by public bodies for the purposes of regeneration should reflect on seeking to protect the public purse from the pursuit of waste. Examples of such schemes are those emanating from the dreamland aspirations of politicians and eager kudos-seeking regeneration urbanists feeding profit-seeking developers. On the other hand, those challenging such schemes have a dilemma deciding whether it is efficacious to fight being left with an untenable position or take advantage of a negotiated opportunity to move. I have to smile at Iceland. They challenged in the High Court regarding Newport and in the process relocated to a new prominent location in Commercial Street away from all those empty units in Friars Walk (Fig 3). Don’t you just love irony?

Fig 3

FINANCIAL SUSTAINABILITY OF LOCAL AUTHORITIESNational Audit Office

While local authority revenue spending power has decreased significantly over recent years, authorities have, taken as a whole, maintained capital spending levels. However, revenue pressures have led to changes in the nature of capital spending with authorities focussing more on schemes intended to generate future revenues. Many are investing less in

physical assets, such as libraries, museums and parks, and spending more on commercial investments, often involving investing in property. The Department for Communities and Local Government (the Department) has overall responsibility in government for the local government finance system. The Department expects authorities to become more

The National Audit Office produced a report in June 2016 which questioned the investment spending of local authorities. Because of space constraints the Editor can only reproduce the summary paragraph of this report, which draws conclusions and makes recommendations, predominantly to DCLG. See https://www.nao.org.uk/report/financial-sustainability-of-local-authorities-capital-expenditure-and-resourcing/. In 2014–15, local authorities spent £38.1bn on revenue to deliver services and £12.3bn on capital (excluding education). Revenue spending on services has fallen since 2010–11, while capital spend has increased in real terms for local authorities as a whole. “However this overall increase masks changes in the purpose of capital spending as authorities now focus increasingly on using their capital programmes to generate revenue returns rather than solely to provide services.”

‘entrepreneurial’ as it encourages local government to become largely self-financing. But we are concerned that the Department appears complacent about the risks to local authority finances, council tax payers and local service users arising from the increasing scale and changing character of commercial activities across the sector. The Department does not have good enough information to understand the scale and nature of authorities’ commercial activities or which authorities are placing themselves at greatest risk and it does not use the information it does have to give it a cumulative picture of risks and pressures across the sector. Unless the Department strengthens its understanding of the capital issues faced by local authorities, it will not be well placed to anticipate risks to financial and service sustainability.


INVESTMENT REWARDS

AND RISKS

Kevin Joyce

Kevin is a London based public sector surveyor involved in asset strategy development, assets consolidation, rationalisation and disposal. [email protected]

DCLG New Investment Strategy Statements Guidance to Local Authorities 2016

Achieving a good balance between income returns and risks is a central theme of September 2016 Department of Communities and Local Government (DCLG) Guidance advice to local authorities, in connection with obligatory requirements for authorities to publish new local government pension schemes’ management Investment Strategy Statements by 1 April 2017. Authorities are required not only to produce and publish the Statements, but to keep them under periodic review (1).

Property investments will typically form part of diversified pension fund investment portfolios, so some knowledge of how other investment classes, such as bonds and equities, are performing or are likely to perform, can help inform particular property investment choices, as well as broader decision-making about how investment strategies could best be shaped and implemented going forward.

The DCLG Guidance makes specific reference to a requirement for local authorities to take proper advice in formulating their policies on diversification, the suitability of investments and types of investment, on the approach to risk, and on social, environmental and corporate

governance factors (1). As we see the procurement of specialist advice and expertise as being essential to protecting the best interests of pension scheme beneficiaries, we would stress therefore that this article is not, and is not intended to be, a substitute for obtaining specialist advice from investment experts.

The Guidance states that the Investment Strategy must include:

ll a requirement to invest money in a wide variety of investments

ll an authority’s assessment of the suitability of particular investments and types of investments

ll an authority’s approach to risk, in-cluding the ways in which risks are to be measured and managed

ll an authority’s approach to pooling investments, including the use of collective investment vehicles and services

ll an authority’s policy on how social, environmental or corporate governance considerations are taken into account in the selection, non-selection, retention and reali-sation of investments, and

ll an authority’s policy on the ex-ercise of rights (including voting rights) attaching to investments (1).

Whereas the Statements are required to set out the maximum percentage of the total value of the investment funds to be invested in particular investments or classes of investment, regulatory frameworks for scheme investments are also to be relaxed, with authorities being expected to make investment decisions within a prudential framework (1).

Few perhaps would argue that the current economic environment for making investment decisions, in a period of sustained low interest rates, and with the added uncertainties now about how Brexit will impact on business expansion plans, makes this a challenging time for UK fund managers.

Bonds investment

The bond markets, in which bondholders or bond purchasers make loans to bond issuers, are the largest global securities markets, with governments, major corporations and even local authorities issuing bonds when they need to raise capital.

The investor receives a fixed income return in the form of interest on the loan as well as repayment of the loan on a fixed maturity or redemption date. As a general rule, the shorter the period from issue to maturity of the bond, the less risky it is perceived as being by investors, as there is a lesser likelihood of unforeseen factors impacting negatively on an issuer’s ability to pay over, say,

A quote by the investment sage Warren Buffett “I don’t look to jump over seven-foot bars: I look around for one-foot bars I can step over” neatly encapsulates how investment strategies should look, to balance opportunities to generate income returns with the taking of investment risks.


a 10-year period than, say, a 30-year period. The interest rate, or coupon, that the issuer will need to pay will be higher therefore for a longer maturity bond than for a shorter bond. The credit rating of an individual issuer will also help determine the interest rate, which is likely to be lower for an issuer with a higher credit rating than for an issuer with a lower credit rating.

There is a direct correlation between the interest rate or yield, and the purchase price of the bond, whereby if yields rise then the purchase price falls and vice versa. The bond markets have been in the doldrums for much of 2016, with Japanese government 10-year bonds actually offering negative returns and by August, UK government 10-year bonds, also known as gilts, were offering yields of a comparatively paltry 0.52%.

By September and October 2016 though, overseas investors, attracted by the weakness of sterling and post Brexit referendum fears receding, piled into UK government debt. Gilt holdings were increased by £238bn, being the largest increase for any 2-month period in the previous 5 years, with yields rising to 1.38% as investors demanded better returns on their money, in anticipation of higher inflation and interest rates.

In November 2016 in the US, up stepped Mr. Donald Trump, to win the presidential election on promises including new infrastructure spending plans, estimated to cost a reported £800bn, and cuts in corporate and personal income tax. The impact on the bond markets, which see these promises if implemented, as leading to a borrowing jump, greater growth and a return of inflation, has been dramatic, with US Treasury 10-year bond yields jumping up to 2.2% and 30-year bond yields jumping up to 3%.

Bonds investment, particularly after a return to what are considered to be normal yield levels, in offering fixed interest and a safe haven for investors’ monies, remains an integral part of a balanced and diversified investment portfolio.

Equities investment

The equities or shares investment markets would generally be expected to generate higher yields than bonds, although the markets are more volatile with smaller investors being regularly reminded that shares can rise but also fall in value, to allay any thoughts investors may harbour that the value of shares will simply march ever upwards. In 2007 for example, share values were soaring just before the worst financial crisis in history. Stock market investment strategies are likely to be strongly influenced by whether the markets are going through bullish or bearish phases, although some investors are known to bet against the markets, with varying degrees of success or failure.

Some caution could also be exercised with valuations. In its November 2016 Financial Stability Review report, the European Central Bank (ECB) issued a warning that the bank considered that prices in some UK equity markets were showing signs of being over-stretched, noting that ‘British shares are more highly valued by historic standards, relative to company profits, than equities in the US, the Eurozone, China or emerging markets’ and were more vulnerable therefore to a market crash than most other global markets on this measure (2).

Interestingly though, since the UK voted to leave Brexit in June 2016, after plummeting initially, UK shares steadily increased in value, to climb to a record all-time high of 7,337.81 points by January 2017, while in the US the Dow Jones Industrial Average broke through the 20,000 points barrier for the first time, to reach 20,068.51 in the same month.

Time will tell whether or not shares will continue to rise, or are about to peak and fall. It appears to have slipped largely under the economic radar, but in February 2017 the World Trade Organisation (WTO) announced a new Trade Facilitation Agreement to streamline customs procedures, which they estimate could boost global trade by £800bn a year by cutting trade costs by an average 14.3% in what Roberto Azevedo, the WTO Director General, has called ‘the biggest reform of global trade this century’.

Investments in shares are made through third party brokers and could involve the direct purchase of shares in a single company, with an investor then becoming a shareholder of the company. An alternative is indirect investment through the purchase of shares in an open-ended fund or trust, typically made up of between 50 and 100 companies, and which might be country, sector or theme specific. From a risks perspective, the money in the funds is ring fenced away from the fund provider, so as to remain secure should the firm default. Closed-end investment trusts are another alternative, they are a smaller, group of pooled investment vehicles, structured in the same way as a limited company.

New investors would invariably be advised to seek independent advice from financial advisers, and might also look out for shares which have been undervalued, focus on a company or fund’s factsheet rather than glossy marketing material they might produce, compare and drive down charges levied for different investment products, and be reasonably wary of investments at the top of performance tables as the investment gains might already have been realised.

Shares are commonly grouped into cyclical and defensive categories, with cyclical shares being tied into the economic wellbeing of an economy, and defensive shares such as pharmaceuticals and tobacco, being more resilient to fluctuations in economic cycles.

Public sector pension funds tend to hold shares for at least 5 years, so as to ride out market fluctuations, but the portfolios should still be kept under regular review with a view to picking out the best stocks in the market.

Property investment

Property investment is widely considered to be the third global asset class, but has distinct differences from bonds and equities in a number of ways, being an imperfect market, generally illiquid, and also normally being expensive to trade, especially should abortive costs be incurred in a transaction. Being a physical asset,


property also suffers from physical depreciation and obsolescence over time, carries the risk of vacancy voids which reduce income streams; and with leverage being used in many transactions, this can also distort the return and risks features of this market.

Property’s attraction though as an investment class is not only helping with risk diversification in the spread of assets in a portfolio, but it can also provide some hedge against inflation. Income streams are normally generated from lease contracts entered into at fixed rents, typically under 5-15 year leases today with 5 yearly upward only rent reviews, and in this respect, have some similar fixed income characteristics as bonds but with opportunities to grow income streams on rent review.

Investment could be by direct property acquisitions, or could involve investment in open-ended or closed-end funds vehicles. Open-ended funds are open for new investment, allowing pension funds to gain access to diversified property portfolios investing purely in domestic property. The funds are unlisted, unit prices are determined by valuations, and investors are able to deal directly with fund managers. Closed-ended funds are closed to new investment, and are driven by strategies to add value to the assets through active management, with investors likely to include overseas funds.

Unexpected events can have unforeseen consequences for the markets. The Summer 2016 Brexit referendum result, for example, caused some panic among UK property fund managers, witnessed in a rush of investors looking to bale out of the funds, forcing the managers to close redemptions for a period, so as to avoid forced sales of underlying office, retail, and industrial and logistics assets, and a possible downward spiral in prices (2).

As some property investment sectors will outperform others, a diversified spread of assets could include investments in the traditional offices, retail, and industrial and logistics markets, but also investments in alternative property investment sectors such as economic and digital infrastructure, social infrastructure and healthcare, leisure, and data centres.

Offices

Although all the main property markets have experienced some post-Brexit referendum jitters, prime office yields for the West End and City of London remain remarkably low at 3.5% and 4.25% respectively, reflecting the capital’s continued predominance as a world class city for investment, but also perhaps, current opportunities for overseas investors to acquire new office stock at a time when sterling is at a 31-year low against the US dollar. Provincial prime office yields, at 5.25%, are also proving popular with overseas investors.

Retail

There is arguably more current uncertainty surrounding the future of UK retail markets than offices, as a weak pound appears likely to increase the prices of imported goods which could depress sales volumes. The prime West End retail market may enjoy the benefits flowing from an increase in overseas tourists keen to take advantage of a favourable exchange rate, but balanced against this is a prospect of the capital seeing the largest rises in business rates, suggesting that prime yields could move out from 4.25%.

The departure of household names such as Austin Reed and Staples from the high street in 2016 hardly appears likely to instil confidence in the markets either. Investment in food stores could prove to be more resilient to changes in yield, currently around 4.5% for prime investments, as foodstuffs and other basic purchases are less prone to fluctuations in consumer confidence.

Industrial and logistics

London remains Europe’s top city for technology companies, with a growing technology sector of 430,000 employees, beating Paris and Berlin into second and third places. There could conceivably be some divergence in the future performance of the industrial and logistics markets, due to different dynamics impacting on each market.

Demand for industrial space is determined not only by demand for finished goods in home markets, but the

competitiveness of goods for export, with a cheaper pound being expected to make UK finished goods more attractive overseas. Although exchange rate pressures can favour the market in this respect, these advantages can also be off-set by higher input costs of imported finished goods and raw materials, with manufacturers looking to pass on the costs to consumers and adding to inflationary pressures in the economy in consequence. Uncertainties about new trade relationships in a post-Brexit world will also take the industrial markets into hitherto uncharted territory.

Brexit will also take the logistics markets into uncharted territory, although the demand and supply balance for large grade A sheds, at least, is such that operators could prove to be less inclined to defer Brexit-related business expansion decisions. The national average vacancy rates for these large sheds has fallen to just over 6% in 2016, and with a slowing pace of new speculative sheds’ development in the year, operators could prove more inclined to fix their logistics network arrangements and occupational costs now, rather than risk deferring such decisions to a later date, when rental growth may have pushed up rental costs for operators.

Economic and digital infrastructure

Philip Hammond’s announced, in the Autumn 2016 Statement, a £23bn package of infrastructure spending on housing, transport, digital communications and research, with the funding due to be delivered through a National Productivity Investment Fund, to make the UK ‘match fit’ for life outside the European Union. The investment is to include some £2.3bn of improved infrastructure in high demand areas to encourage more housebuilding, £220m for works to alleviate traffic pinch points on strategic roads, £27m for a new motor expressway between Oxford and Cambridge, £4.7bn for businesses and universities research and development programmes, and £1bn to support the roll-out of 5G technology and faster broadband.

In addition, the Statement announced details of a £400m venture capital pot, managed by the British Business


Bank, which is intended to unlock £1bn of financial support for business start-ups, with the fintech, digital and life sciences sectors expected to be some of the principal beneficiaries of this investment.

Government’s reaffirmation of its commitment to new economic infrastructure investment is on top of both an existing £483bn projects pipeline set out in the UK National Infrastructure Delivery Plan, and a commitment to close all coal-fired power stations by 2025. Pension funds, insurers, and early-stage debt and equity investors are all expected to compete strongly for projects which could provide natural inbuilt inflation-linked cash flows (e.g. toll roads) as well as high returns down the line for the taking-on of initial development phase risks.

Social infrastructure and healthcare

The returns and risks associated with new social infrastructure investment are altogether less clear. The financial crises currently being faced by the NHS, and its consequences for front-line healthcare services, have been compounded by increasing problems with bed-blocking of hospital beds by the elderly, arising from a lack of care support in the community, with Alzheimer’s disease and dementia for the first time overtaking heart disease as the primary cause of death in the elderly, and care home providers turning their backs on local authority contracts and leaving the market because of increased costs of operation.

Despite the pressures of an ageing population, between September 2010 and July 2016, the number of UK care homes fell by 1,454 and the number of care home beds fell by 119,454, with a number of banks having serious levels of financial exposure to the care homes market (3). Council tax increases averaging £90, and amounting to an estimated £900m over the next 2 years, to address the adult social care crisis, are to be introduced from April 2017, although critics have suggested that this would still be insufficient to meet social care gap funding needs, estimated at £2bn plus.

So would an investor need to be brave, or foolhardy, to invest in this sector? At

present, the prospects of investing well and securely do not appear to be hugely promising. This should not mean, though, that a fundamental, co-ordinated, and well-financed change programme could not turn the UK healthcare sector around. We can envisage funding of the development of both a new generation of fit-for-purpose care homes, possibly through the raising of investment bonds finance, and a series of strategically located medi-centres to take some responsibilities for day-care and minor and keyhole day surgery away from major hospitals, as playing a key part in such a change programme.

Leisure

The leisure sector, employing 10% of the UK workforce, is a diverse market encompassing hotels, restaurants, theme parks, leisure parks, and health and fitness, which has benefited from longer leases and generally lower void rates than other investment markets. Brexit and the fall in the value of sterling has had an impact.

Already relatively buoyant, the UK hotels market now appears to be enjoying a mini-boom with the weakness of sterling attracting both overseas visitors as well as overseas investors. A feature of the market is a growing number of boutique hotels springing up in London. The Grade 2 listed Bow Street Magistrates Court, which has over the years hosted reluctant social celebrity guests like Oscar Wilde and more dubious luminaries such as the Kray Twins, has been bought by a Qatari investor for conversion into a 100-bed hotel. At Covent Garden, the actor Robert De Niro has invested in the conversion of the Joe Allen US-style diner into a boutique hotel, much to the dismay of patrons of the diner.

2016 has also been a buoyant year for UK restaurants, with London’s culinary scene, for example, being referred to as a golden age, with a record 200 restaurant openings in the year. An analysis by the London guide Harden’s warns that this level of growth might not prove sustainable, expressing concern that intense competition between restaurants for custom and potential problems with recruiting new staff under tougher immigration rules,

could pose a double threat to ongoing profitability of restaurant businesses. The fall in the value of sterling has also raised the costs of imported foods and could squeeze consumer spending.

Data centres

Data centres are a relatively recent entrant to the property investment sector, with growth of the market being fuelled by wholesale data space needs of corporate, enterprise, institutional and cloud service provider clients, which is powering demand for new facilities and accelerating new build programmes globally.

Data4 Group, which offers both co-location racks and purpose-built dedicated facility data storage options at its Marcoussis campus south of Paris, sold a record 6MW of co-location space on the campus in the second quarter of 2016. The largest data centre in the UK is a 1998 built, 750,000 sq ft Next Generation Data Europe Centre at Newport in Wales, with its 2 main occupiers, BT and Logica, each occupying 2 halls of 75,000 sq ft. The average size of UK data centres is around 100,000 sq ft.

Investment institutions are reportedly showing increased interest in data centres, attracted by yields of up to 9%, and some blue-chip occupiers are on leases of up to 20 years, on rents geared to 3% annual inflation-linked uplifts, giving the assets bond characteristics. Alibaba Cloud, China’s leading international cloud computing service provider, has plans to take market share from Alphabet, Amazon, IBM and Microsoft, through the development of centres in Australia, Dubai, Germany and Japan, as part of a £800m investment programme.

References

(1) Local Government Pension Scheme: Guidance on Preparing and Maintaining an Investment Strategy Statement, DCLG, September 2016

(2) ’UK equities are on the brink, bank warns’ Patrick Hosking, Financial Editor, The Times 25.11.16

(3) ’Care homes under pressure as costs soar’ David Rankin, The Times 12.10.16.


CPD meeting on 27 January 2017

Eastern Branch held its meeting at The Guildhall, Cambridge on 27 January 2017, hosted by Phil Doggett of Cambridge City Council.

Attendees heard presentations from 4 speakers:

Colin Cottage, Glenny Chartered Surveyors

Colin talked about best value approaches to compulsory purchase, including a wide range of case studies concerning regeneration, transport and utilities. Colin explained that the Infrastructure and CPO practice, formally established by Glenny in 2011, now employs 5 people and has national coverage. While the firm had always undertaken compensation work it was the work on the Olympic Games/Legacy that has led to national recognition and coverage. Although Colin had promised to avoid a detailed technical narrative on the ‘compensation codes’ he had no difficulty in demonstrating his detailed knowledge of legislation and guidance, while explaining how an acquiring authority can adopt a forward-looking and pragmatic approach to CPO.

Paul Wootton, Howes Percival Solicitors

Paul was previously Head of Planning at Eversheds, where he advised the government on the London Olympics. During this time he worked with Colin and other CPO specialists. Paul provided a presentation on the London Olympics, which was both interesting and revealing. Like Colin, Paul acts for claimants (as well as acquiring authorities) and provided us with several cautionary tales of authorities that had unfortunately left themselves open to “Stokes v Cambridge” ransom claims and other challenging situations as a consequence of poor planning and promotion of schemes. Paul concluded by outlining the circumstances that

led to DCLG not confirming LB of Southwark’s Aylesbury estate CPO, despite the fact that the acquiring authority’s proposals were both well considered and worthy.

Rob Levene, MD of NEPRO

Rob outlined the business model, entitled a ‘public sector neutral vendor approach’, which is fully OJEU compliant, having won an open OJEU tender, run by the North East Procurement Organisation (NEPO). NEPO was created by local authorities and public bodies in north east England and provides a number of frameworks. NEPO procured NEPRO, a private sector manager to deliver a national framework for specialist professional services, and made it available to the whole UK public sector. Its supply chain extends to around 2,000 providers, many of whom are SME’s, assigned to a range of categories, including chartered surveyors, asset managers and related professionals who serve ACES’ sectors.

A key distinction with other, perhaps more well-known frameworks, is that the NEPRO framework is ‘dynamic’. This means that new suppliers are constantly being added and indeed, authorities are able to nominate suppliers with whom they are already acquainted. Authorities and suppliers contract through NEPRO, who support authorities in procuring suppliers and in streamlining their procurement processes and in establishing a corporate approach to procurement, including identifying overall consultancy spend and realising corporate savings in expenditure. This is, to a great extent, achieved by ensuring that specifications are resourced and priced to deliver specific outcomes, rather than encouraging open-ended time charges. Rob went on to explain that this approach neatly dovetails with impending HMRC rules, which will require that engaging bodies - local authorities and/or intermediaries – ensure, and are responsible for ensuring, that contractors comply with IR35.

Hassan Iqbal, oneSource

Hassan is Strategic Business Partner. He explained that oneSource is a wide-ranging shared service in the London Boroughs of Havering, Newham and Bexley and includes property services. Glenny has been engaged via oneSource to advise on a number of regeneration schemes in Havering. Hassan explained that LBH has now ‘mandated’ NEPRO as the preferred procurement route (Central Bedfordshire and West Sussex have similarly). He commended NEPRO as having a number of advantages over established frameworks including the ability constantly to update its supply chain. He also provided several examples of how NEPRO has saved LBH time and money in recent property (and technical) services-related procurement exercises.

After the presentations, the open forum discussions focused on:

ll Difficulties being experienced in recruitment of permanent staff and how this relates to temporary/agency staff and IR35

ll Public sector land and residential (including direct) development; demand for sites; sales rates, in-vestor appetite for PRS and hybrid schemes

ll Impact of NHS policy changes which encourage better utilisation of void space (potentially to the detriment of local authority OPE initiatives).

CPD meeting on 24 March 2017

The spring meeting was held at Landmark House, Ipswich on 24 March, hosted by Brian Prettyman of Suffolk County Council. Around 40 people attended, including ACES National President, Daniella Barrow.

The branch received 3 presentations which are summarised below:

Branches News

DUNCAN BLACKIE, EASTERN BRANCH


Melvyn Stone, Estates Director NPS Group

Melvyn explained the joint partnership between NPS and Broadland District Council, to develop Carrowbreck Meadow, Hellsden, Norwich with 14 Passivhauss (including 6 shared equity houses). [Ed – please see full article in this Terrier].

Melvyn outlined the difficulties of developing a council-owned contaminated site, the creation of a company and its governance arrangements, the technical specification for passivhauss, governance of the company, costs and value, including profit-sharing and assessing social value, and consultations with the owners and tenants. The scheme has been shortlisted for various awards and awaits the outcome.

James Lemon, Principal Consultant at Arcadis

James is part of the environment sector team based in Newmarket and provided his presentation via the following link: https://we.tl/QJCfgPXLTm.

The talk was about housing development on brownfield land, using a case study of Abbotsgate, Bury St Edmunds. It was previously used land, planning permission for 125 houses with a land contamination condition. The polluter was a dry cleaning company, long since dissolved [Ed – I don’t think Duncan intended a pun there], with PCEs in ground water [Ed - a colorless liquid widely used for dry cleaning of fabrics]. The developer had undertaken remediation, but this was found to be inadequate by the Environment Agency. The developer then went into administration with the site partially built out – plots for 60 units remained undeveloped.

James explained the extensive testing which was undertaken by Arcadis, including using specialist methods only available through the company. The administrator and bank identified £4m of latent value in the site and agreed to fund further investigations and remediation. The source of pollution was the dry cleaning company, which had discharged PCEs into the drain, which had polluted the aquifer.

The solution identified estimated a cost

of c£700,000 and fees around £160,000. Techniques included, membrane interface probe, soil vapour extraction, ground water pumping, in situ chemical reduction.

Gideon Simons, Arcadis

Gideon is a Senior Consultant, Geotechnics, Tunnelling, GIS and Data Management based in London. Gideon provided a link to his presentation via https://we.tl/6ZkYnBdoEN. He summarised the value of GIS in collaboration, understanding the geography of assets, and working digitally.

He outlined GIS as a data collation portal; the use of GIS for field asset data collection; the ability of 3D visualisations, and GIS and building information modelling.

Daniella Barrow, ACES National President, greeted members and guests and offered support for the way Eastern branch operates. She then spoke about her efforts to ensure that ACES remains relevant to public sector property professionals by fostering:

ll Engagement and sharing best practice

ll Improving links with RICS and higher education

ll Adapting membership criteria (Neil McManus is leading a working party.

Daniella also spoke about the results of the survey of members on future national conferences – there had been a good response, including from Eastern branch. She also advised that the 2017 conference will be held on 28-29 September at the Royal Armouries Museum in Leeds [Ed – note for your diaries]. However, the days will be arranged as individual packages, so it will be easy to attend for a single day, if this is preferred.

Preparations for 2018 conference – the branch supported a proposal from Neil

McManus and Brian Prettyman for this to be held at Downing College, Cambridge on 20 September 2018. This will be Neil’s Presidential Conference and he, together with Brian, have been working up a business plan. They are keen to engage with branch members and take the opportunity to showcase best practice in eastern region.

The conference theme is being developed but is likely to focus on the important role of surveyors in generating additional revenues/value for the public sector and in cost reduction. It is anticipated that Eastern branch will host some sort of post-breakfast activity for Friday morning.

Any other business

Andrew Rowson of Improvement East highlighted a vacancy for an OPE programme manager in Cambridgeshire, echoed by other delegates about similar roles developing.

The next branch meeting will be held on Friday 30 June 2017 at Cambridge Fire Station.

DUNCAN BLACKIE LTD TRADING AS

CLIENT SIDE PROPERTY SERVICES FOR THE PUBLIC SECTOR

CONTACT: Duncan Blackie

TEL: 07951 515 702

EMAIL: [email protected]

WEB: www.DCBProperty.co.uk


PETER BURT, HEART OF ENGLAND BRANCHJoint ACES Heart of England Branch/Government Property Unit/Valuation Office Agency: Learning and Networking Day

Innovation, responsible entrepreneurialism and good relationship management will be the key skills needed by the modern estate surveyor to be successful in the public sector. This was the conclusion reached by a workshop held as part of a joint ACES/GPU/VOA Learning and Networking day held in Birmingham on 9 February. The event provided 5 hours’ formal CPD and proved popular. Attendance was at capacity with 50 delegates and speakers, all crammed into a medium-size conference room at the Carrs Lane Conference Centre, Birmingham.

The workshop considered the skill sets needed to meet the changing role of the modern estate surveyor in the public sector. The general view was that resourcing pressures within 'in house' estates teams will mean that in the future they can only be generalists. In many instances they will not be the property service provider. They will have to take on the role of an intelligent client and look to external public sector property services specialists. They will need strong leadership (not dictatorship) and good communication skills, have to sell themselves, fully understand public sector service delivery and modern business techniques, challenge the status quo and be able to demonstrate to service managers how property can add value to their services by providing answers to property problems – not just identify problems. They will need to take risks, but these need to be reasonable, and fully understand the concept of due diligence; not just play with property.

In the morning, prior to the workshop session held just before lunch, delegates received presentations on ‘One Public Estate’ from Colin Packman, East Midlands and Business Engagement

and Innovation Services Lead, GPU; and ‘Issues emerging from the One Public Estate programme and opportunities it presents for place-making and regeneration’ from Tim Preston, Arcadis Account Director for Local Government. He is responsible at Arcadis for advising local authorities and other public sector clients on generating value from their assets and improving the effectiveness of property.

But the undoubted star of the morning session was ACES Branch member David Blanchard. His talk on ‘Melton Parkside: Centre of Excellence for information sharing’ captivated the audience and dominated the question and answer time. David is the Corporate Property Officer for Melton Borough Council and it was not surprising that he was a success, as the project won the ACES Award for Excellence in 2015. Parkside is the response to a major fire that totally destroyed the former council offices, and so presented an opportunity to improve local service delivery through closer collaboration with other public, third party and private sector organisations. His presentation went through the initial response to the fire, how they developed with the county council as the primary partner a joint vision, and then delivered a regenerated town station site, and a joint services centre which has achieved flexible working through an integrated approach and jointly developed protocols.

The afternoon session focused on housing with a joint presentation on 'Development viability and affordable housing’ from Tony Williams, Head of Viability, the DVS Development Viability Consultancy part of the VOA and Jeffrey Solomon, Principal Valuer, DVS, part of the VOA. Then Emyr Poole, Manager, Programmes Directorate, Homes and Community Agency (HCA), closed the event with a talk on the ‘Role of the HCA’ covering the government’s key message from the housing white paper announced just days before the CPD event, housing infrastructure fund, accelerated construction, affordable

housing programme, assistance for small builders and the HCA total funding package.

3 November meeting and Branch AGM

The decision to hold the Joint CPD event with the GPU and VOA was made at the Branch AGM held on 3 November 2016 hosted by Telford Council. At the AGM Geoff Taylor, Warwickshire County Council was elected Vice Chair with Judith Bayes, Peter Burt and Richard Allen continuing in their roles of Chair, Secretary and Treasurer respectively.

There were 2 morning presentations. James Dunn introduced the Telford Town Centre development with Phase 1 comprising a hotel, restaurants, an expansion of the ice rink, First Point building housing a new library, public facility, university and Costa and Greene King on the ground floor and a multi storey car park. This was funded by the HCA (£10m), assets from West Midlands Development Agency and the sale of hotel and cinema sites. James explained that Phase 2 comprised the redevelopment of Meeting Point House, where the Branch meeting was held, but the proposed residential development was still proving to be a challenge. Finally, he explained the Telford Land Deal and in particular the financial agreements reached with HCA to bring land forward for development around the town.

Teresa Roberts of the VOA gave a presentation on the Business Rates revaluation to come into force on 1 April 2017. The rental dates for the revaluation were taken as of 1 April 2015. All valuations have now been completed and the basis for appealing was outlined. Rental valuations are now online and all owners/surveyors can see the basis of their valuations. A breakdown of the regional differences was provided, together with the trends in each sector such as retail, office and industrial.


Topics raised and discussed in the ordinary meeting included community asset transfer protocol, use of promotional agreements to remove risk in the disposal of development sites, the implications of new reporting standards for school asset valuations, the effect of minimum efficiency standards on letting property after 1 April 2018, experience of members with the use of ePIMS and condition survey templates.

Nottingham Trent University

On behalf of the branch, in December last year, Richard Allen gave his usual talk on corporate real estate management in the public sector to the final year students on the BSc (Honours) Real Estate course at Nottingham Trent University. Every year he updates the talk and this year changed the title from 'Public property: A catalyst and driver for change' to 'The 20-year journey from 1000s to just One Public Estate'. A week later he accompanied the students on a visit to the existing Derbyshire Fire and Rescue headquarters, located in

Derby, in a converted and now not fit for purpose former Rolls Royce building. The group then went on to visit the new partly opened state of the art joint Police and Fire Services headquarters just outside Ripley, on land owned by the Police Authority.

While at the existing headquarters the students received a presentation from Richard Brunt, the Fire and Rescue Services Area Manager, Corporate Services, responsible for the new joint headquarters project. Richard explained that he was a chartered building surveyor, who had moved from the Chatsworth Estate with the brief to reduce significantly the service's maintenance backlog from £35m. The move to the new joint headquarters gets it down to £3.5m. Rather than sell the site of the existing headquarters, located in an upmarket residential suburb of Derby behind 'millionaires row', and which has a value of around £3m, the service was being more enterprising and forming a joint venture company to develop on the site a large

elderly care complex. When completed the complex would have a capital value around twice the site value. The largest number of fires occur in homes occupied by elderly people. Providing purpose-built accommodation for the elderly, incorporating modern fire prevention facilities, also contributes to the Fire Service’s corporate objectives of reducing the risk of fire in homes occupied by vulnerable people.

Date and venue of next meeting

The next Branch meeting on 6 July 2017 will be hosted by Erewash District Council in Long Eaton, with CPD topics being HS2 property implications and disposals of major surplus public sector properties and sites.

NORTH EAST BRANCH - JOINT CPD DAYEarly morning Thursday 12 January 2017. Sheffield. Cold, wet, ‘thundersnow’ forecast. Not the most promising start to a day.

The event was a Joint CPD Day organised across various property professional groups and organisations including the Government Property Unit (GPU), VOA, ACES and RICS. The event was hosted by Sheffield Hallam University and attended by both lecturers and students. Many in the audience including ACES members were ‘alumni’ of the university.

The day was introduced by the President of ACES, Daniella Barrow, herself a former student of the university, and the themes of public sector surveyors supporting each other and the next generation of surveyors was touched upon.

The first speaker was Susan Betts, a regional property adviser at the GPU who gave an informative update on the

‘One Public Estate’ Programme, including some tangible examples where work of surveyors across government is making a real difference to public service delivery. York City Council then stepped up to talk about its move from 17 disparate and ‘unfit for purpose’ buildings in the city to just 2, including the renovation of the original York railway station buildings. Originally the hub for the Great North Eastern Railway, the project incorporated old and new into a flagship council HQ with numerous other public bodies taking space within the building.

The audience was then given a fascinating history lesson from Brian Ablett, formerly of Leeds City Council, around early building techniques, including the world’s largest brick built arch at Ctesiphon in Iraq, incredibly built in 450BC, and an amusing analogy between the modern day typical student room in a new build development and the accommodation available over 5,000 years ago at Skara Brae in the Orkneys.

The presentation covered Smart Cities Technology, The Internet of Things and was very thought provoking, generating much discussion during the networking sessions.

Following on, the next presenter, Mike Perry from the Building Research Establishment also generated a lot of debate as he introduced a new concept of using the existing IT network log-ons to provide data to use in planning the

Delegates network at the CPD Day


JOHN READ, NORTH EAST BRANCHThe North East branch held its last branch meeting in Middlesbrough on 10 March and it was the first meeting held since the retirement of Mike Ackroyd, so a big thanks to Helen Stubbs who has taken over the role of Branch Secretary and for pulling together the arrangements for the day.

The meeting was hosted by Middlesbrough Council together with the Kier Group and was held at

the Custom House/My Place in close proximity to the famous Middlesbrough Transporter Bridge. Also known as the Tees Transporter Bridge, it is the furthest downstream bridge across the River Tees and carries a suspended travelling ‘car’ or ‘gondola’ across the river in about 90 seconds and can carry 200 people and 9 cars. It has featured in a number of films and TV series and I remember when Auf Weidersehen Pet featured a story around the bridge being dismantled and sold

to be re-erected in the USA. This caused so much fuss that the BBC had to issue a disclaimer stating that the bridge was still in Middlesbrough - and it still is - and acts as a visitor attraction.

Back to details about our branch meeting. It was attended by almost 40 delegates from across the region and started with an introduction from our hosts, with David Allred giving a presentation on economic growth in

use of desk space.

Wayne Cox from the VOA delivered a review of valuation methods applicable to local authority occupations, including an update of some recent case studies and a thought-provoking session on building functionality, including a former power station used as an art gallery and a historic ruined building – Urquhart Castle - generating commercial revenues from modern day weddings (and all rateable!).

The final speaker was Becky Thomson from the RICS, who updated the audience on global valuation standards as well as

the work of ‘future talent teams’ of RICS members, working with school rather than university students, to consider a career in the surveying profession.

That theme, together with surveying skills in general, was continued in a lively audience discussion led by John Murray the Deputy Head of Profession at the VOA [Ed – author of this summary and ACES member] and Tony Cheetham from the university, who also introduced a number of the current students and final year projects, seeking input from the audience and the wider profession.

The event was summarised and closed by VOA Chief Valuer Mary Hardman

Was the day a success? 120 professionals joined students and staff to participate in an event that was informative, lively, and brought together so many from across the public sector, and the generations - somewhat unique.

List of speakers:

Daniella Barrow, Operations Director NPS Group, [email protected]

Mary Hardman, Chief Valuer, Valuation Office Agency, [email protected]

Susan Betts, Regional Property Advisor, NE Region, Disposals and One Public Estate, Government Property Unit, [email protected]

Brian Ablett, Guest lecturer with Northumbria University, [email protected]

Mike Perry, BRE, [email protected]

Tony Cheetham MSc, BA Hons, FHEA, MRICS, Principal Lecturer, Sheffield Hallam University, [email protected]

Wayne Cox MRICS Dip Rating, National Specialist Unit, VOA, [email protected]

Becky Thomson BA (Hons) DipSurv FRICS, UK Valuation Associate Director, RICS, [email protected]

Art Gallery

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Bed, dresser, foodstore, hearth – not unlike modern

student accommodation

Urquhart Castle and visitor centre


Middlesbrough and how the council has succesfully built up investor confidence over the last few years. David outlined projects including:

ll Diversification of the town centre

ll Monthly artisan food markets

ll Holiday Inn development under-pinned by council loan finance to help reduce developer risk

ll £200m of investment by the university in the Middlehaven area, and

ll The steady increase in housing completions over recent years.

He also outlined future aspirations and schemes, including plans for major investments in housing (working with the HCA), a new snow centre, Centre Square which will provide Grade A office space in the town centre and an £8m town hall refurbishment, part funded by Heritage Lottery.

This was followed by a presentation from Paul Taylor of Stockton Borough Council on the West Heat Initiatives, an innovative scheme to deliver low cost energy to power-hungry businesses in the area and help protect the long term sustainability the sector and provide opportunities for expansion and business rates growth. The project is based on the premise that there is enough heat vented by existing business to generate power for all buildings in Teesside. The council is working with partners to deliver a district heat and power network of insulated pipes which capture and distribute process heat from existing industry in the form of energy to other users in the area. The initiative will generate energy cheaper than the grid and also provide commercial income to help contribute to the cost of delivering local authority services. Of the 3 schemes, the one at Bellingham is at the definitive feasibility stage with signed non-disclosure agreements with main process heat generators and anchor end users [Ed – see article on district heating systems in this edition of Terrier].

This presentation was followed by a technical update by John Murray of

the Valuation Office Agency covering a variety of topics, including issues arising from the Spring Budget; business rates; Stock Valuation Guidance and a summary of new and upcomming RICS guidance.

Then finally before lunch, Graham Tyerman of the Kier Group gave an update on the work of the RICS Taskforce looking at the development of guidance on Depreciated Replacement Valuations.

After lunch, we moved on to a housing theme and I gave a short presentation on the govermment White Paper ‘Fixing our broken housing market’, outlining the key themes, major challenges and the 4 steps identified in the Paper to address the failure of the market [Ed – see article on the White Paper in this edition of Terrier]. The White Paper also included a consultation posing 38 questions, many of which dealt with planning matters. The views of the audience were sought on only a few of these questions where the issues touched on matters directly relevant to the local authority property sector.

Following on from this presentation, Brian Ablett continued with the housing theme, giving a presentation ‘Matching housing delivery to outcomes: using a Smart Cities approach to ensure better results’. Brian explained that while Leeds Council had funds to build 1,000 new houses, it first took the step of wondering exactly what should be built so that these would be better than those replaced. He then set out a long list of social, health, education and economic factors that required to be considered, to understand what the house designs could do to address these. It was a long list and showed how, with considerable forethought, new designs could make a substantial contribution to a whole range of issues facing both the tenants and often other council colleagues.

Looking on-site at the private sector scheme, for advanced family houses being built in Sheffield by the local developer, CITU, Leeds Council developed a technical and energy standard to drive the specification for the housing. This will require almost zero energy input, taking a fabric-first approach. Integrating "smartness" into

the building meant that it will operate passively, through the specification and design process, for the life of the house; additional technology-led opportunites can be added to support specific needs for occupiers. The presentation was well received and some attendees requested copies of the work to take back to their authorities, a sign of a successful presentation and CPD day [Ed – see Passivhaus article in this edition of Terrier].

All in all, the day provided a good range of CPD and an opportunity for members to network, discussing current topics and sharing experience and acheivements.

Moving forward, the Branch Executive is now considering entries for the University of Northumbria student prize and is has met with Daniella to discuss how the branch can support her in the orginisation of the ACES National Conference on 28 and 29 September and how we might dovetail our next branch meeting with the conference.


NORTH EAST BRANCH STUDENT PRIZEThe North East branch continues to work with universities in its area and is pleased to announce the winner of this year's prize for applied valuation awarded to 3 students at Sheffield Hallam University. This is a prize that the branch awards annually as it provides the branch with the opportunity to raise awareness and the profile of ACES with the education sector.

"The partnership with Sheffield Hallam and ACES is very valuable, we always strive to forge links with surveying practitioners and this connection enables us to do this effectively. Students are keen to engage in the exhibition event to showcase their work both internally to students and

staff and externally to ACES and other professionals involved in the property industry." (Helen Reardon, Department of the Natural and Built Environment, Sheffield Hallam University).

As part of their final year studies, students were required to produce a research poster based upon a topic area introduced in their Development Practice Module. The subject areas that students could choose from for the focus of the poster exercise were easements; covenants; occupier liability; land contamination and environmental liabilities; heritage and development of listed buildings; and compulsory purchase. As in previous years the

standard of posters was very high and these were displayed at the CPD Day in January for Public Sector Surveyors, hosted by Sheffield Hallam University.

The North East Branch Executive had the difficult job of choosing a prize winner and selected one covering the theme of freehold covenants, based around the hypothetical sale of a prominent property in Downing Street, London. The poster included an excellent technical summary presented in an imaginative and humorous manner that caught the eyes of the judging panel. The prize winners were John Gration, Harry Stewart, Tobias Bolton.

ALAN WHARTON, LONDON BRANCHLondon Branch CPD

London Branch continues to enjoy a varied programme of CPD events and we are very grateful to our friends at GVA for their regular Espresso briefings and also external speakers who have given their time to come and speak at our bi-monthly branch meetings. Perhaps a London venue and London audience helps, especially as we have been joined by several new members over the past year, and we are used to working with a wide range of external partners in our day to day business.

The GVA Espresso sessions occur early on Friday mornings at their city office. The first seminar of the year in January was titled “Rating Revaluation 2017”. The Business Rates team outlined the 2017 rating revaluation, who the potential winners and losers are, and what the key changes to the rating system are likely to be. Some of this has now been revealed in the subsequent budget and it’s clear that businesses face very significant challenges across the country.

In March the topic was “Public private sector procurement”, while the third

in the series in May will be on “The insider’s guide to public private property partnerships”. On this occasion our own member Andy Algar will co-present as a guest speaker so that the session will offer a dual consultant/client perspective about how to go about designing, procuring and implementing the optimum public private partnership structure for property development projects.

We have found that the increased challenges of working with other organisations both to deliver services and to carry out regeneration and development projects is becoming a very significant topic for discussion.

We are looking forward to 4 more sessions with GVA this year, on topics yet to be announced but all no doubt relevant and topical, and we know they will be delivered with the usual insight and humour that we have become used to.

In the same vein, we have enjoyed some illuminating presentations this year at our regular branch meetings.

20 January 2017

We had 2 presentations:

Community Health Partnerships

CHP has been tasked by the NHS to find new ways to address infrastructure requirements, in the belief that a new estates model is required to deliver the ‘Five Year Forward View’ and the ‘GP Forward View’. There is a mismatch between the portfolio and delivery – some is poor quality but intensively used, whereas some is good quality but underused.

The key points of the presentation were:

ll The aim is to bring together all organisations with a stake in public health. There is a growing ageing population which places new demands on health provision

ll The estate portfolio needs to be aligned to new models of health care, noting that the estate often lags behind advances in clinical delivery

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ll The portfolio should not be in the debt of government

ll Both LAs and the health sector can use the same mechanisms such as LIFT and programmes such as OPE. This can be extended to include such services as schools

ll A new structure is to be proposed together with a bid for £15bn investment, although no indication of the likelihood of success has yet been indicated

ll Investment can be both for physi-cal renewal and for future income generation: interest has therefore come both from the construction sector and from investors.

A lively discussion followed which highlighted some of the practical challenges of aligning local authority and NHS property procedures and strategies. This highlights the benefit of bringing more property professionals working for the health sector within the ACES fold. This would promote a common understanding of where we can work most effectively together.

Siemens

This fascinating talk showed how globalisation is a key feature of our

modern world, alongside environmental considerations and the technical revolution. The presentation focused on ‘smart city’ principles, noting that London was starting from an ‘old’ base, whereas other European cities like Berlin were newer. This has a significant impact on deliverability; however some innovations like the Oyster Travelcard system had been very successful.

Smart cities also challenge traditional employment norms: some job types were becoming redundant due to new technology and artificial intelligence, but other job types were evolving. For example, there is a current shortage of engineers.

17 March 2017

We had a presentation on Community whole care centres, delivered by Michael Bye (Diocese of London) and Steve Finch (Blueland).

The initiative centres on some 450 church hall sites in the London area. They were not on consecrated land or part of the related church itself. There is a 6-year programme and, working with Blueland, can put together a variety of funding packages, supported by a full professional team, to realise the benefits of what are usually well-located sites in the community. Funding can be contributed to

by charities, the NHS and LAs. Developments can include other types of community asset, such as schools, and the concept fits with the One Public Estate programme, although it has not so far been formally associated with OPE. Many London areas are actually experiencing an increase in church membership, including Haringey and Southwark. The same applies to York.

Some 40% of health outcomes are delivered from non-NHS sites. Their approach is ‘social prescribing’, based on social rather than medical care.

Mr Finch explained that the governance process had similarities with NHS processes, and all parties had to sign up to the project objectives. The NHS requires the Diocese to facilitate all capital expenditure, but will then consider a range of leasehold options.

All our branch meetings include a presentation on a topic of current interest, either on a technical subject such as rating or procurement, or on new ways of delivering services. We look forward to an interesting series of presentations for the rest of the year. The details will be posted on the ACES website so if any members from other branches wish to join us, they will be very welcome.

Other interest areas

EVERY REBEL HAS A CAUSEDave Pogson

For 50 years until retirement Dave practised as a surveyor in Lancashire and Cumbria, becoming a Fellow of the RICS and working for the Department of the Environment, Lancashire County Council, South Lakeland District Council and the NPS Group. During that time, he wrote articles on surveying topics and work experiences which allowed him to introduce some controversy, humour and the odd bit of fiction. [email protected]

“The hope must be that, whatever lies ahead, their experiences should serve as a lasting reminder of why Northern Ireland should never again return to full-scale conflict, a lasting reminder of the sadness and the pity of it all, a lasting reminder that war is hell” (1).


“You’re refusing to go to Northern Ireland?”

The Senior Estates Surveyor fixed me with an incredulous stare. Based on that look I deduced that, in his lengthy career, no-one had ever before refused a direct instruction from him. We were alone in his office. He was sitting behind his large oak and leather-topped desk and I was standing in front of it on a square of carpet that covered a part of the standard civil service linoleum flooring. My mouth was dry so I just nodded and pressed my right foot firmly against the carpet to stop my leg from shaking.

"You need to reflect on this. While you're doing that I'll consult Head Office. You'll be hearing from me again. Now get out of my room."

I backed out and returned to my desk wondering if I still had a job.

It was 1974 and Northern Ireland was a dangerous place to go to. I'd been happy working on my quiet and safe Lake District patch. I was one of only 2 young surveyors in the office, younger by over 30 years. The other 5 surveyors were nearing retirement age and they had all taken their turn to cover Northern Ireland. I'd known that I might have to do it one day but had put it to the back of my mind, thinking that they would never give it to someone of my relatively limited experience and on the lowest pay grade. The trouble was that I’d been doing some good work on the

Lake District, finding and buying sites for the rapidly-expanding GPO telephone exchange network. It had been noticed. Also, I'd recently passed a promotion board that would elevate me from Assistant Estates Surveyor as soon as a vacancy opened up, probably in another office. It was likely that the Senior Estates Surveyor was going to lose me anyway so I guessed that he thought that he might as well make use of me on Northern Ireland while he had me and thus give the others a break from it. I was a victim of my own success.

The office covered the management of the government's property across the whole of Lancashire, Cumberland and Westmorland, and Northern Ireland. We did all the buying, selling, hiring and letting of land and buildings needed for government functions and for the Post Office. I could never understand why Northern Ireland didn't have its own local office with its own surveyors. Instead we flew people out to Belfast and put them up in the Europa Hotel and then flew them back again on a regular basis. I'd heard the tales from the others - Customs posts blown up every weekend, government offices with steel security fences around them and windows meshed against rocket attack, the gated and guarded Belfast shopping centre, metal-detector scans at the airports, searching of vehicles in and out of Stormont.

“You’ll never get any sleep. There’s a bomb scare at the Europa every night,” was one comment.

Although no-one from the office had been killed or injured yet, I didn't want to be the first.

I wasn’t interested in Northern Ireland. Whatever was going on there was none of my business. Ok, it was part of my country but I would have been quite happy if someone had cut the mooring rope and allowed it to float away into the Atlantic. I knew it was complicated; that the cause of ‘the Troubles’ was somehow tied up with religious differences and the historic wish by some Catholics to throw off British rule and re-join Eire but I’d never been there, didn’t know anyone from that part of the world and never really discussed it with anyone who knew much about it either. If the subject came up I’d usually say,

“If I’d wanted to visit a war zone I’d have joined the army,” or “I’ve no interest in religion. If there’s a God he’s being used to justify killing by both sides and that seems incompatible with reason.”

In any event, based on one single incident from 3 years earlier, I already thought that, for my own safety, it was a place to be kept well away from.

I’d presented my arguments to the Senior Estates Surveyor,

“I’ve only recently married. We’ve just moved 30 miles from our nearest relatives because I can't afford to commute and pay the mortgage on our first house. We can't even afford a telephone. Going to Northern Ireland means leaving my wife, with our 4-month old baby daughter, alone in a strange town to worry about me without any kind of support or means of contact and without the use of our car while mine is parked at the airport.”

In truth, I could probably have overcome most or all of those practical issues if I’d really had to. I just didn’t want to go. I began to think about Mal again, as I had so many times before over the last 3 years.

I'd been in the same year as Mal all through the grammar school. I'd liked him right from the beginning. Everybody liked him.

Despite the regular attempts of all the

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boys to maim each other on the rugby field, by the time we reached the sixth form, he’d kept his good looks intact. Off the field, when he popped on his pair of thin-framed spectacles that he needed just for reading, he looked even more intelligent than his excellent exam results proved. In common with a lot of others, we laughed at each other and at ourselves through years of sporting effort, academic stress and adolescent uncertainty until we came out of the other end as successful products of the grammar school system.

His father led the local pipe band and Mal could play the bagpipes with the best of them. They were a popular attraction at local fetes and every year they would head the parade at the sports day in the village where I lived. In his black tunic and tartan kilt with a dirk stuck into his stocking he really looked the part as he led the front row of the massed pipes and drums behind his father.

“I see that you’re wearing your skirt again.”

“Sue prefers me in it.”

Ah - Sue, his equal from the girls’ grammar school who turned every lad’s head as she walked across the crowded concourse of the city bus station to meet Mal every afternoon after school. She gave him the perfect response to my ribbing.

When we left school, without planning it, Mal and I ended up in the same city but at different institutions. He went to the university to study engineering and I went to the polytechnic to study surveying. At first we used to meet up occasionally for a drink but most weekends he went home to meet Sue and I went off playing rugby. Life got in the way. We saw less and less of each other.

The last time that I saw him was after we had both qualified. Mal had started as a trainee engineer with the BBC at Crystal Palace and I had returned home to take up a trainee surveying post with the Department of the Environment. He was in the crowded Kismet Bar, an early discotheque with a jukebox and ultra-violet lamps that highlighted both dandruff and teeth fillings, on the first floor of the Broadway Hotel. Its windows overlooked the seafront onto

Morecambe Bay. Sue was with him, still turning heads.

"What are you doing home?"

"I've just finished my initial training and the BBC is sending me on a job - transmitter repairs. I'm catching the ferry for Northern Ireland tomorrow.”

“Aren’t you worried about the risks?”

“Nah, I’ll be ok. By the way, we've just got engaged."

Sue waved the ring at me.

“Congratulations.”

Eventually they had to go.

"Look out for yourself over there."

Mal grinned and waved as he opened the door to leave. I watched them from the window as they walked across the promenade. It was dark outside but, unusually for the time of year, there was no hint of winter mist on the water. I could see the street lights at Grange on the far side of the bay, reflecting on the incoming tide, which made them seem particularly bright.

It’s a common question. "Can you remember where you were when - Kennedy was shot; England won the World Cup; Neil Armstrong landed on the moon?" It's odd how some events stick in your mind and you can place yourself back in time as if it was yesterday, while other memories fade away almost to nothing. I can remember very clearly where I was when I read about Mal.

My immediate boss, not the Senior Estates Surveyor but the Estates Surveyor in between him and me, was keen on snooker. He liked watching it and playing it and he was quite good at it. So every workday lunchtime he and I, and Brian and George who were the Clerical Officers, would drive to the local Conservative Club, collecting pies and a newspaper on the way. Civil Service working hours were not too rigidly enforced and we could usually make lunch last for an hour and a half. We'd buy a pint at the club, eat the pies and

play doubles at snooker. I wasn't that keen on the game but took my turn and then read the paper in between turns.

It was just before 1pm on Wednesday, 10 February 1971 when I read the headline. Brian had taken his turn and failed to pot a red, leaving it hanging over the pocket. I was partnering my boss against the other two.

“It’s your turn.”

I didn’t hear them at first as I scanned the front-page article. Then I looked up at my boss.

"You take it" I said as I tried to understand what I’d just read: Bomb blast kills BBC Engineers in County Tyrone.

I think that, for the rest of the day, I just sat in my office and did nothing - I’m not sure - and then I probably went home at 5pm. But I can still clearly remember where I was when I’d read that headline and where I'd been just a few days earlier when I'd said goodbye to Mal.

My wife had summed up the situation.

“We have to pay the mortgage and we’ve a baby to feed so you can’t just give up the job. Think of all the ways that you can reduce the risks and we’ll come up with a plan.”

Now I was back, standing on the same square of carpet. I'd been summoned again, this time to hear the verdict from Head Office.

"Either you go to Northern Ireland or be dismissed."

“Ok, I’ll go but I have to give you fair warning that this may mean that I have to seek alternative employment as soon as possible."

I returned to my office and started to put the plan into action. The next day a copy of that week’s Estates Gazette was placed in my in-tray with my morning mail. It had been curled open at the ‘Situations Vacant’ section, the preceding pages held back with a large paperclip. On the top margin was scrawled “You may be needing this" in his handwriting.


He was calling my bluff.

The Northern Ireland Assembly had been suspended in favour of direct rule from Westminster. It was necessary to set up Civil Service support within Stormont.

“Your main task is to buy houses to accommodate the senior ranks of the new Civil Service being recruited to support direct rule. Those Civil Servants will be seconded from the mainland to fill the newly-created posts. They’ll get promotion on a 3 years’ contract with all accommodation provided, rent and rates free, and job protection on return to Britain at the end of the contract.

You’ll buy those houses within a specific geographical ‘safe zone’ near to Belfast where it will be possible to flood the area with troops, throw an armed ring around those Civil Servants and airlift them and their families out with helicopters if the balloon goes up.”

“Do I get to manage the job as I think appropriate?”

“Yes, er, yes, provided you get results.”

He wanted to tell Headquarters that he had quashed my rebellion.

“The other part of the job will be to replace the Customs posts. On average we’re losing one each weekend to the bombers. You’re to arrange replacements with caravans, usually on a Monday morning, as that’s the only way of providing temporary accommodation quickly for the Customs Officers at the border posts.

Plus, you’ll also do anything else that might crop up over there.”

I kept my trips to a minimum. The local newspaper that covered the safe zone was delivered to my desk each week. I had to scour the estate agency pages for houses for sale within that zone. Then I would fly out to inspect them for purchase. As it was, there were only 2 or 3 potentially-suitable houses newly-listed for sale on the market within the safe zone within any 2-week period. So, to limit my visits, I arranged appointments to inspect all new listings

on the same day. I would fly out in the morning, inspect them all that day and catch the evening flight back. Then I would try to buy as many of those houses as possible over the telephone. That way I only visited Northern Ireland for one day every fortnight.

The Customs posts were even easier to deal with. So many had been blown up that it had become just a matter of being alerted to the relevant location each Monday morning, estimating a price for a replacement caravan from a trade price guide and ringing the supplier to negotiate the price and place the order. Later in the day I’d check by phone with the local Customs staff that the replacement had been delivered and was suitable. That way I never had to visit any Customs post locations while doing my house purchase inspections.

The visits involved flying out from Ringway to Aldergrove. Passengers were scanned for weapons or bombs before each flight.

“Remember not to talk to anyone about the purpose of your visit.”

Upon landing I had to wait in the arrivals lounge until my name was announced over the loudspeaker.

“Good morning, sir. Where are we going today?”

A chauffeur in a grey uniform suit and a matching peaked cap would escort me to a large, black 4-door Wolseley saloon with English registration plates. The route was usually down the Shankill Road and through Belfast to reach the ‘safe zone’. I wondered about the quality of the security. Any terrorist wanting to take me out would only have had to follow the easily identifiable car or lie in wait outside the airport. This was particularly noticeable if it was necessary to call in at Stormont where the checking of IDs and the inspecting of car boots for bombs or weapons were carried out in the open spaces outside the closed and manned main gates of its long driveway, where any sniper could pick me off, rather than in some secure, unobservable area. I asked,

“Have you had any problems while driving?”

“A couple of weeks back one of the other drivers had a bullet through his windscreen and out through the front passenger side window. Fortunately, no-one was sitting in that seat at the time. It’s rare; there’s nothing to worry about, sir.”

It wasn’t reassuring.

I met some pleasant people, particularly the drivers, toured some attractive countryside very similar to the Lake District and surveyed some expensive houses. Through Belfast I saw terraced streets with cleared bomb sites, sectarian murals painted on exposed gable walls and army vehicles moving at speed. In the event, nothing nasty happened to me but, on every trip, it felt like I had a target pinned to my back for the whole of the time that I was there.

In the 12 weeks between January 1974, when the change had been made to my duties, and April 1974, I visited Northern Ireland for only 6 separate days. During that time, putting into effect the second part of the plan, I scoured the professional magazines for surveying vacancies.

“I hereby give you one month’s notice to terminate my contract.”

Local Government Re-organisation came to my rescue. Surveying jobs were being advertised at the newly-formed county, metropolitan and district councils. As soon as the job offer was confirmed I stopped arranging appointments for house inspections while my notice expired. I had not been bluffing.

I never went to Mal’s funeral (2) in Morecambe. Maybe I should have but I didn’t really want to go. I preferred my final memory of him to be that last night in the Kismet Bar when I’d seen him happy about getting engaged and excited about his new job. For years afterwards Mal’s father made the crossing to visit the transmitter site to pipe a lament at the place on the track where Mal had died. When I pass the Broadway at night and see the lights across the bay I always think about Mal.


THE GLOUCESTER GLADIATOR

– IN THE MATTER OF MEETINGSIndulgence or necessary evil; you take your pick. I’m thinking particularly of the formal, structured (or unstructured), regular get togethers rather than the ad hoc encounters with clients or those forming part of negotiations.

Invariably there will be rituals, conventions, hierarchies and protocols to be adhered to; woe betide the newcomer who inadvertently sits in the wrong place at the table and upsets time-honoured seating arrangements. First will be the dispensing of tea and coffee and the ice breaker social chit chat that so oils the wheels of robust discourse. That can take up a good quarter of any event. Likewise, winding down after the main event can also take up valuable time.

Setting a balanced agenda is, of course, a pre-condition for the effective use of time. Mind you not all agendas can be said to achieve such lofty heights. I well recall, and I kid you not, one agenda which consisted of: Welcome; Chairman’s introduction; Apologies for Absence; Minutes; Accuracy of Minutes; Matters Arising; Any Other Business; Date of Next Meeting; and Chairman’s Closing Remarks. Presumably there must have been a lot to get through from the minutes of the previous meeting!

In an idle moment - they increasingly occur these days - I ruminated on the amount of time I have spent, or

wasted, attending such events during my professional career. Working on 2 meetings a week, each lasting up to 2 hours over 46 weeks a year, spread over 43 years, amounts to 7,912 hours. Now that is probably wildly inaccurate, but gives a rough indication of the amount of time spent talking, reviewing, arguing, prioritising, deliberating on important issues, or so they seemed at the time, of the day. Working an average, say, of 9 hours a day that equates to 879 days, or 176 weeks, or indeed, 3.8 years of my working life. Was that all a productive use of my time: I’m not sure, but in later years as I would be the convenor of so many of these events, I have only myself to blame if they weren’t.

Now you may feel a note of scepticism has crept into my meanderings. Not so; meetings play an important part of disseminating information; providing opportunities to let off steam; chances for new ideas and thinking to germinate and eventually flourish; and for new priorities and programmes to be set. They enable regular monitoring of often disparate activities to occur; and can provide time, that important commodity, to reflect on the maelstrom of business which has recently taken place, and to plan ahead with confidence and clarity.

The role of chairman, or chair to use a more PC term, is clearly pivotal. They come in all shapes and sizes: autocratic,

democratic, dynamic, inert, vague, focused, decisive, and indecisive - I could go on. The best chairs orchestrate the ebb and flow of discussion; silencing, or at least tempering, the loquacious while encouraging the timid out of their shells, maintaining a sense of purpose and direction, neatly concluding each item with a resume of what has been decided.

Minutes too play an important part in the conduct of effective meetings. To meet the Goldilocks test they shouldn’t be too long or short, never too rambling, but disciplined enough to record the essence of discussion and to reflect faithfully what has, or indeed hasn’t, been agreed or what actions need to be taken. Prompt write-up of meeting notes by minute takers must be good practice as I know to my cost. Some years ago I was secretary to one of the Association’s branches, no names etc. Now my writing is at the best of times totally indecipherable to the extent I can never decode what on earth I may have written. To compound my inadequacies, on this occasion I had omitted to write up the minutes of the AGM until a week before the next one, falling as convention would have it some 12 months after the meeting in question. Could I either read or recall what had been agreed? No; so an erudite work of fiction was compiled. At the next AGM the minutes were approved without question, indeed were even

However, to this day, I’ve not been back to Northern Ireland. Unlike Mal’s father, I’ve never had good cause to do so.

Notes

1. Quotation from ‘Lost Lives’, compiled by David McKittrick, Seamus Kelters, Brian Feeney, Chris Thornton and David McVea. It was first published in 1999 and has been updated subsequently. It lists in chronological order the stories

of the 3,700 victims from all sides of the Troubles.

2. In the timeline of those 3,700 entries, numbers 55 to 59 relate to the 5 innocent victims of one incident: On 9 February 1971 Malcolm David Henson, 24, BBC Technician, single, of Morecambe, England was killed along with his colleagues, William Thomas (BBC Engineer), John Aitken (Labourer), George Beck (Labourer) and Henry

Edgar (Labourer). They were in a BBC Land Rover driving up the track to Brougher Mountain Transmitter Station at Enniskillen to carry out repairs, when they triggered the tripwire leading to a landmine placed in some boulders at the side of the track. It is thought that the landmine was meant for a British Army patrol which periodically inspected the transmitter but that morning the BBC vehicle had arrived first on the site.


commended for their accuracy and conciseness. Perhaps the fact that so many of the personnel attending had changed had something to do with it.

While technology may reduce the need for physical attendance at meetings; think video and teleconferences, I retain an old-fashioned view that this will never totally replace the intimacy, comfort and familiarity of the round the table get together. Essentially we are social creatures who enjoy, need, value and benefit from interaction with one another. Indeed, it’s not only the workplace where this happens. While my days now seem increasingly to be filled with non-remunerative activity, much of this revolves around getting together with other people in formal settings, so the tyranny and habit of attending meetings darned meetings hasn’t yet been totally overcome. I wonder if it ever will?

Why not use the ACES website for advertising your job vacancies?ACES now has a live Jobs Page (open to all) on the ACES website to cater for member and non-member organisations advertising for public sector property posts. See www.aces.org.uk/jobs/

The page gives a summary of the available post with the details of location, salary and deadline and provides a link to the organisation’s own website for further details and application form etc.

At an introductory rate of just £250.00 per advert for ACES’ member organisations and £400.00 for non-members for a maximum of 4 weeks’ exposure on the ACES website, this is excellent value!!

Just £250.00 to gain direct access to likely candidates already working in the public sector property arena with the expertise and experience that you are looking for.

Contact the ACES Secretary, Keith Jewsbury, at [email protected] for further information. ACES


EG 29 August 1964

Taken from “Correspondence” concerning bank loans on property:

“Sir,

I expect many of your readers were interested to read the report in the national press that Barclays Bank were in danger of losing an estimated sum of £45,000 through making injudicious loans on property. This prompts me to suggest that now might be a very advantageous time for active members of the professional institutions to press these bodies to make a new approach to the banks to see if they would adopt a different method of obtaining valuations.

As is probably well known to your readers, the present system normally adopted by all banks is to invite the local manager to the nearest branch to the property concerned to make an appraisal of it….it may be that the manager will go or send a clerk to have a look at the property from the outside; they rarely inspect the inside!

Surely now is an opportune time for pressure to be put on all the banks to employ properly qualified valuers for all their work.” [Ed – I assume that this was a serious, not tongue in cheek letter?].

EG 23 January 1965

An article on the future of shopping:

“Shopkeepers have been slow to respond to the obvious desire of an increasing number of people to be able to do their

shopping outside normal working hours, and this….is surely one of the main reasons why mail order businesses are flourishing…. A continuation of the move towards mail order trading…were 2 prophesies made by Sir Rex Cohen at a meeting of the Royal Society of Arts recently.” [Ed – prophetic or what?].

EG 13 March 1965

What’s this about Brexit?

“We cannot live as an island (politically and economically, as well as geographically) in the changing world. Should we attempt to do so, our economy would continue to take its downward curve and we should become impoverished in the midst of prosperity. At that stage our negotiating potentiality would be minimal.

…..With the benefit of hindsight our decision not to join E.E.C. in 1955 must be one of the most disastrous decisions taken by any British Government.” [Ed – hmmm!].

EG 17 April 1965

Who says collaboration and cross-boundary cooperation is new?

“Mr Richard Crossman, Minister of Housing and Local Government, spoke to the Royal Town Planning Institute: “We should try to create the conditions in which local authorities themselves would work constructively together. This has already happened in some conurbations, where comprehensive land use and transportation studies have been commissioned”……to systematically end the cold war between the authorities in a conurbation.”

EG 8 May 1965

Nothing changes on the housing challenges:

“although most people are aware that the housing shortage could be eased to a

very large extent if everyone living in an under-occupied dwelling moved to one of more suitable size, nobody has ever come forward with a really practical scheme by which this could be accomplished.” [Ed – although I havn’t reproduced any quotes here, through the 1960s there were numerous articles about how to solve the housing shortage. But in that decade, the 2 main problems were still war damage, and replacement of slums. Annual rates of house building were massively greater than the 1 million target for the next 4 years].

EG 31 July 1965

On house prices and mortgages:

“In all discussions about making house-purchase easier, it is often forgotten that instead of waiting for 100% mortgages at low interest rates, the best thing a young married couple can do is start saving money. That no one should contemplate buying a house in present circumstances unless he has saved at least £500 is sound advice.”

ESTATE GAZETTES OF YESTERYEARBetty Albon, ACES Editor

Well how better to use a spare page than to feature some interesting extracts from Estate Gazettes of yesteryear? I inherited from my mentor volumes of bound 1960s through to 1980s Estates Gazettes. They make fascinating reading through those dark winter nights and some short pieces are worth sharing.

ACES NATIONAL CONFERENCE28 and 29 September 2017

The Royal Armouries, Armouries Drive, Leeds, LS10 1LT

AN OPPORTUNITY TO GAIN 6 HOURS

OF CPD ON EACH DAYJoin us to review the biggest areas that our members are facing and identify the solutions that can help make a difference. With such an enormous period of change and uncertainty, the ACES National Conference 2017 is the perfect opportunity for public sector property professionals to come together, to listen, share thoughts, take stock and re-energise. Over the 2 days the conference will examine and explore the political and policy environment, the economic outlook, the impact of Brexit and the latest thinking across the sector.

This year’s conference will be at the Royal Armouries in Leeds on 28 and 29 September. The Royal Armouries is a central location to Leeds with good connectivity by rail, car and air.

The conference will have a minimum of 6 hours CPD per day and will cover a range of subject areas including:

Housing, development and regeneration Commercial property

Legislation and legal updates Best practice initiatives

Asset valuation updates/refresh Business rates

Service delivery Health

Please watch http://www.aces.org.uk/2017Conference/ for further details of speakers and the programme, as the planning progresses.


THE SUFFOLK SCRIBBLER

60 Not Out

I am delighted to say that progress has been made on what is now to be called 60 Not Out. It is now to all intents and purposes ready, or so I am advised, but again, sadly, no thanks to me.

I mentioned in the last piece that there was light at the end of the tunnel. This proved to be – from my point of view – an oncoming train. The general lack of energy I have been experiencing recently has been supplanted by a stay in hospital. I have been banged up in maximum security at the West Suffolk Hospital for the past 10 days and I remain there with a release date of Monday 3 April [Ed – it happened and Scribbler is back home!].

The progress that has been made on 60 Not Out is all due to the efforts of the Editor and Marcus Macaulay, who is the person who usually does the technical work in preparing Terrier publications.

I thought I would include an extract from my Introduction:

My first Suffolk Scribbler piece was published in the Spring 2002 edition of The Terrier. “The Editor is delighted to be able to introduce to Terrier readers a humble, yet outstandingly adequate, successor to our much loved erstwhile columnist, Yesterday’s Man. This is the first of what we hope will be a popular and long-running column by the Suffolk Scribbler.”

Colin Bradford’s introduction was quite far-sighted in predicting a “long-running column” as we are already at 15 years and still counting. And it was this point that first gave birth to the concept of publishing all the Suffolk Scribbler pieces under one cover.

Consequently, after the publication of 60 pieces, totalling over 105,000 words, the project to combine all published Suffolk Scribblers in a commemorative booklet was proposed jointly by William Marshall, a humble nobody from Suffolk,

and the current Editor of The Terrier, Betty Albon. ACES Eastern Branch has provided generous funding to help pay for a professionally produced pdf document with the intention of then forwarding a copy of this to every ACES member.

I did hear it said that when it was known that I was going to write a regular, somewhat light-hearted column, some ACES members laughed. Well, they’re not laughing now!

Food for thought

My stay in hospital has also produced much food for thought, particularly on the subject of my ‘parkinsonism’. When I told the doctors about the alternative diagnosis which I reported in 2016/17 Winter Terrier, they all fell about laughing, as they were convinced that to produce detailed information on toxins present and their quantities would take far more than maintaining contact with the fancy silvery box which the toxins lady used. It would take detailed analysis of body parts. Since being here, I cannot trace losing any vital bits and pieces to do this.

Also, the doctors’ view of the masses of homeopathic remedies and dietary supplements which I religiously take is a complete waste of time, as in many cases the various tablets are working against the prescribed medicines which I also take. So, medically speaking, I will leave hospital and enter into a different world with a much-simplified medical regime to follow.

Fred Karno

The name of Fred Karno came up during a TV presentation while I was in hospital. Clearly the name meant little to the TV audience, or to the viewers in the hospital. However, Fred Karno was a visual comedian, presumably from the 1930s, who had his own dedicated troop of associates performing with him. Their ‘shtick’ was to make a complete mess of whatever they were trying to do, and it

was one of my brother Peter’s favourite expressions, ie: “they’re making a right Fred Karno’s of this, aren’t they?”

Radio comedy and by-passes

The main book I took into hospital with me dealt with radio comedy 1938-68 and so this mention of Fred Karno heightened my interest in reading about radio comedy in the 30s and 40s.

One of the first comedians to be covered in the book is Robb Wilton as ‘Mr Muddlecombe JP’. One of his series of comedies was entitled “Public Futilities” and there is a lovely quote here:

Mr M: “But we must keep up with the times, be up to date. Bless my life, every decent town these days has its by-pass.”

Mr Battersburn: “My argument is that we don’t have enough passers-by to want a by-pass!”

Mr M: “No, but the passers-by who do not pass by, if they had a by-pass to pass by, would be able to pass by the by-pass.”

This reminds me of the time about 30 years ago when a Suffolk County Councillor came in to see me, excited about the prospects for a new Brandon by-pass. Brandon was a small market town of about 15,000 people. He enthusiastically told me that it would cost £10m to build, to which I suggested: “wouldn’t it be cheaper to move Brandon?”

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h e Te r r i e r - Aces · blazing down and winter is behind us. This issue contains an extended section on ACES branch ... North East student prize - John Read.....56 London - Alan