Comments by the Scottish Property Federation on the Sesplan Main Issues Report

30 September 2015

By E-Mail

COMMENTS BY THE SCOTTISH PROPERTY FEDERATION ON THE SESPLAN MAIN ISSUES REPORT

Introduction

The Scottish Property Federation (SPF) is a voice for the property industry in Scotland. We include among our members; property investors, developers, landlords of commercial and residential property, and professional property consultants and advisers.

We welcome the opportunity to contribute to the Main Issues Report. As discussed the SPF,as a membership organisation, had difficulties in submitting a response via the consultation portal. As agreed we have prepared a word response to allow you to add into the system. These comments are in the order of the questions raised in the consultation.

Question 1

The Vision

Do you support the preferred option, alternative option or none of the options? Please explain your answer. You may also suggest any changes.

The main concern for SPF in SESPlan 2 is to ensure viable employment and investment opportunities are secured for the region. Edinburgh is performing relatively strongly at the moment with significant commercial investments on-going at Haymarket, New Waverley, Quartermile and the St James Quarter redevelopment to name a few. Edinburgh Park has also seen some recent investment and the Shawfair development is also again underway. It will be important to build on this success more broadly across the region.

Our members are also of the view that the provision of sufficient housing across all tenures is crucial to a healthy prosperous and sustainable city region. This can be achieved through the allocation of a sufficient effective supply of marketable housing land in locations where people want to live and consequently developers want to build. There is real concern that the approach taken in SDP1 which was based on a strategy of not meeting housing need and demand will be repeated.

In our view the proposed vision for housing is not far-sighted or ambitious enough. Some members have suggested that SESPlan should look to a more ambitious vision for housing to ensure that demands are met and house prices become more affordable. In short, we must plan for a strong economic growth and the attendant population increases and demands that a strong economy will create.

Our members are also concerned that the MIR2 seems to place too much emphasis on reasons to constrain the delivery of market housing, an approach that will inevitably lead to continuing house price inflation. This in turn will create the circumstances where increased contributions to subsidised affordable housing are likely to be sought, leading to the likelihood of a decrease in the supply of such housing. This circle needs to be broken by adding significantly to the supply of private market housing, which will assist in reducing/stabilising house prices and support affordable housing delivery.

Question 2

A Strategy for Edinburgh and South East Scotland

Do you support:

Alternative Option 1 Concentrated Growth (fig 2.2);
Alternative Option 2 Distributed Growth (fig 2.3);
Preferred Option 3 Growth Corridors (fig 2.4); or
None of the Options.

Please explain your answer. You may also suggest any changes

Our members are strongly of the view that there should be a focus on delivering the growth of the city region through growth corridors. Our members are of the view that while it is appropriate for SDP2 to continue to direct growth towards identified SDAs it is also appropriate to direct development to sustainable locations out with the SDAs. SDP1 contains a sequential approach which indicates that preference should be given to the allocation of housing sites in SDAs compared to non-SDAs. Our members have concerns that in some cases non-SDA locations may be preferable in regard to sustainability. Sustainable development relies on identifying locations where people want to live and do business.

The availability and deliverability of all infrastructure to enable sustainable patterns of settlement growth requires to be considered in the preparation of a City Region wide development strategy. Essential infrastructure considerations include, for example roads, education, drainage, broadband and availability of community facilities. In addition, access to amenities and leisure facilities will also be important considerations for both employers and households alike.

Across the SDP area, local authorities adopt different approaches to securing infrastructure associated with settlement growth and in particular housing development. The early stage preparation of SDP2 provides the opportunity to put in place a framework of guidance which sets out requirements and delivery mechanisms across the constituent local authorities. A consistent approach should provide developers with increased certainty, speeding up delivery of development and supporting infrastructure. However, costs and viability will remain key issues and will need to be carefully considered in a situation of continued financial risk aversion. SPF will be pleased to contribute to the consideration of any proposals for such mechanisms.

Question 3

The Principles for Development

Do you support the principles for development? Please explain your answer. You may also suggest any changes, including other principles for development.

Our members are firmly of the view that it is appropriate for key principles to be addressed by Local Development Plans. The purpose of the Strategic Development Plan is to address “land issues that cross local authority boundaries or involve strategic infrastructure”.

Question 4

Do you support the above approach to direct LDPs to deliver high quality places? Please explain your answer. You may also suggest any changes, including other factors to be considered.

Our members would like to see buildings with flexible, viable and cost effective designs that can be adapted to suit changing aspirations and fluid markets in the current economic environment. Place making is supported around a good infrastructure (particularly transport) with access to a mixture of property uses including retail outlets, employment, leisure and ideally residential uses. They are of the view that this is important for both commercial and residential development with similar aspirations applying to both. The key will be to associate transport and development correctly. Mixed development of residential and commercial centres can also help (thus minimising private transport use).

Healthy lives rely on the provision of sufficient housing for all. To ensure the area’s housing land requirements are met SDP2 can direct housing towards marketable locations where people want to live and developers want to build. If housing land, which meets these criteria, is not allocated, there will be a shortfall in effective housing land supply and the housing land requirement will not be addressed.

As outlined above the single greatest problem in today’s housing market is lack of supply. The potential of the new build Private Rented Sector (PRS) could make a significant difference to the number of new homes provided in Scotland. The multiplier effect of new investment would bring enormous economic benefits and should, be actively encouraged and incentivised.

Question 5

Locations of significant business clusters

Do you support the preferred option, alternative option or none of the options? Please explain your answer. You may also suggest any changes.

Our members welcome the proposal to protect existing business and industry locations. In particular members welcome the protection of grade A office space in the city centre, which as stated in the proposed plan remains the prime locations for office development and occupier demand.

Question 6

The Visitor Economy

Do you support the preferred option? Please explain your answer. You may also suggest any changes.

Our members welcome the policy to recognise the contributions that tourism makes to the economy. There continues to be strong demand for hotels and other facilities in the region and this form of economic development should be encouraged and facilitated.

Question 7

Wind Energy

Do you support the emerging content of SDP2 relating to wind energy? Please explain your answer. You may also suggest any changes.

Should SDP2 identify broad cross-boundary areas where cumulative impacts from wind turbines may happen?

Informed by local authority landscape studies and supplementary planning guidance. 2 SPP paragraphs 161 to 166.

No comment.

Question 8

Resource Extraction

Do you support the preferred option, alternative option or none of the options? Please explain your answer. You may also suggest any changes.

No comment.

Question 9

Waste

Do you support the emerging content of SDP2 relating to waste? Please explain your answer. You may also suggest any changes.

No comment

Question 10

Housing Land across the SESplan Area

As the basis for deriving the housing supply targets and housing land requirements within SDP2, do you support the:

Preferred Option 1 Steady Economic Growth;

Alternative Option 2 Increasing Economic Activity with more High and Low Skilled Jobs; Alternative Option 3 Strong Economic Growth; or

None of the Options

Please explain your answer. You may also suggest any changes.

The SPF is concerned that the preferred option is a misconceived basis for the SESplan 2 strategy and also at odds with the SESplan Councils’ stated ambitions for economic growth and the arguments being made by those Councils in support of the current City Deal bid. The City Deal bid has been based on a proposed accelerated economic growth of 5% per year. Steady economic growth will not achieve this and our members question whether the City Deal bid can be successful if the SESplan strategy is for lower economic growth.

The SPF’s top priority is securing economic recovery and jobs and our members consider that it is vital to establish key priorities for investment in both infrastructure and other development that will underpin long term sustainable economic and private sector growth. Our members therefore welcome the proposal to protect existing business and industry locations and supports strong economic growth. In particular members welcome the protection of grade A office space in the city centre, which as stated in the proposed plan remains the prime locations for office development and demand.

A further reason given by the MIR2 for not encouraging strong economic growth is that people have found it difficult to access mortgage finance and that welfare reform will lead to reduced disposable income. Our members disagree with this and are firmly of the view that stronger economic growth is more likely to lead to higher levels of employment and income and as a consequence more accessible mortgage finance.

Our members believe that the provision of sufficient housing across all tenures is crucial to a healthy prosperous and sustainable city region. A successful residential market is an important aspect of a thriving economic region. As well as delivering accommodation for employees and communities a thriving residential sector supports a range of trades and professions. Potentially, such a residential market can be an important source of investment income for larger scale investors.

A successful residential market is achieved through the allocation and delivery of a sufficient effective supply of marketable housing land in locations where people want to live and consequently developers want to build. Healthy lives are supported by the provision of sufficient housing for all. To ensure the area’s housing land requirements are met SDP2 can direct housing towards marketable locations where people want to live and developers want to build. If housing land, which meets these criteria, is not allocated, there will be a shortfall in effective housing land supply and the housing land requirement will not be addressed.

The MIR2 argues that strong economic growth should not be encouraged because of the increased challenge of securing funding for affordable housing provision. This seems to be a very contradictory justification. To further restrict supply on the basis that there is not enough money to subsidise affordable housing will simply exacerbate the shortage of affordable housing whilst also contributing to house price rises.

The single greatest problem in today’s housing market and a major contributor to homes being unaffordable is the constraint on housing supply. Alongside the traditional focus on new house-building, affordable housing and social housing, the new-build Private Rented Sector (PRS) could also make a significant difference to the number of new homes provided in Scotland. The multiplier effect of new investment would bring enormous economic benefits and should be actively encouraged and incentivised.

Not only do we see the prospect of new build-to-rent as a valuable addition to the residential market but we believe it is also adaptable to meeting the needs and demands of many of the emerging criteria identified in the HNDA for SESPlan 2. There has been a recent move for older residents to sell up and move into quality serviced accommodation, possibly to support the home owning aspirations of a younger generation. There are also a greater proportion of single households and more transient households. The flexibility of the PRS could be a key contributor to meeting the demands of these groups of people. In addition there will be a rapidly escalating requirement across the region for the provision of homes that meet the needs of a growing older population.

Our members observe that attracting larger scale investment should take account of new build development for rental purposes where appropriate. This would introduce a scale of quality and choice that would support wider objectives such as additional supply and more energy efficiency housing. Larger scale landlords would also have costs to consider but generally may be in a better position to effect energy efficiency improvements and to invest in property condition, than those who operate on a smaller scale.

Our members believe that it is not appropriate for the Development Plan framework to prescribe stringent design criteria. SDP2 could support residential development in sustainable locations and in particular those located within close proximity to railway stations.

The availability and deliverability of all infrastructures to enable sustainable patterns of settlement growth requires to be considered in the preparation of a City Region wide development strategy. Essential infrastructure considerations include, for example roads, education, drainage, broadband and availability of community facilities. In addition, access to amenities and leisure facilities will also be important considerations for both employers and households alike.

Our members are of the view that improving deprived areas is one important factor and have noted that the priorities omit the contribution that new greenspace associated with new residential development plays in improving the environment. SDP2 offers the potential to identify to promote its role.

Should SDP2 consider housing land supply targets that are lower than the housing need and demand estimates?

Please explain your answer.

No. Please see above. The single greatest problem in today’s housing market is lack of supply. Our members believe that the provision of sufficient housing across all tenures is crucial to a healthy prosperous and sustainable city region. A successful residential market is an important aspect of a thriving economic region. As well as delivering accommodation for employees and communities a thriving residential sector supports a range of trades and professions.

Question 11

Housing Land in Edinburgh

Do you support:

Alternative Option 1 All Housing Need and Demand;

Preferred Option 2 Significant Proportion of Need and Demand;

Alternative Option 3 Lower Level of Need and Demand than Options 1 or 2; or None of the Options

Please explain your answer. You may also suggest any changes

As already stated the SPF has concerns about the lowest economic growth option suggested by the MIR2, this “significant proportion” is not actually very significant in real terms and would not appear to result in any step-change in housing delivery. The figures given in Table 4.3 would appear to indicate that no increase in housing delivery in the five other SESplan Council areas would be required.

Our members are disappointed that the MIR2 does not identify either preferred or alternative Housing Supply Targets and Housing Requirements for the six SESplan Councils. The MIR2 at the moment presents preferred and alternative strategies, the actual implications of which are difficult to interpret and predict in terms of the amount of new housing land that is required. Some of our members are of the view that Tables 4.2 and 4.3 suggests that the preferred strategy of Steady Economic Growth + Edinburgh Focus (Option 2) will not lead to a significant increase in house completions from that currently identified in SESplan Housing Land Audits (which show a shortfall in the 5 year supply of more than 20,000 homes in respect to the requirements of Policy 5 of SESplan 1). In our view it would have been entirely possible and appropriate to present options for housing targets and requirements for consultation, particularly as they constitute probably the most significant and contentious part the SDP. We therefore strongly recommend that there is further consultation on this matter prior to publication of the Proposed SESplan.