Creating successful public and private partnerships

Partnerships between local authorities and the private sector are on the increase as local authorities remain under pressure to deliver additional housing and improve their existing estates.

The public sector is a large landowner but often lacks the design and construction expertise or the access to funding which the private sector can bring. Conflicting objectives can often be an issue in these partnerships. Private developers tend to have a short term interest in land and need to ensure that value is fully realised. Local authorities have a less profit driven, longer term interest and are more demanding when it comes to design and construction quality, open space and specification, all of which can drive up costs and put pressure on both programme and profitability. The demand from the public sector is for these new partnerships to design and deliver new urban developments that create safe and desirable neighbourhoods, and ultimately provide better homes, education and working environments.

Land assembly is often complicated with a number of different private owners as well as the local authority holding the parcels of land needed to create new estates. The skill is in pulling together a master plan that is economically viable and exciting, which also has local planning support and is deliverable within a defined programme. Regeneration schemes often require some use of CPO powers, so to ensure that the private sector can be perused that there is a worthwhile development opportunity, the vacant possession strategy always needs early consideration.

The regeneration scheme in Stratford, which has been undertaken as part of the London 2012 legacy, is a good example of complicated land assembly and successful public/private partnerships. As part of the land assembly, a large number of CPOs were required; commercial land and private and social rented or shared ownership homes were required to bring the site together and create a comprehensive site for the Olympic Games and the legacy works. The London Legacy Development Corporation, responsible for delivering the Olympic legacy, partnered with private developers such as Taylor Wimpey, L&Q, Balfour Beatty and Delancey to create residential and commercial developments together with the required social infrastructure, creating a new desirable place and bringing new homes, schools and jobs to the area.

Public sector governance structures are also a matter for consideration for these partnerships. Local authorities frequently have an internal approval process which tends to be more demanding than private sector companies. This can be time consuming and put pressure on the programme.

It is useful therefore to try to agree as much as possible at the start to limit having to submit for further approvals. This preliminary work can establish all of the key components of the project with a view to having them signed off at the outset. This would include any initial approvals the local authority needs, an early design, consultation with the local planning authority, viability assessments and the selection of a procurement method.

A collaborative approach is needed if conflicting objectives are to be avoided; that and recognition on the part of each party of the other’s agenda. As local authorities and the private sector become more heavily involved with one another a greater level of mutual understanding will develop that will, at the very least, help them both become more effective and deliver better schemes by working together.

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