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Developer Experience of Deferred Receipt Mechanisms. Charles Church – Land Director Gladedale (Central Scotland) Ltd. Developers Lack of Money Risk Cash Management. Shift in Market Conditions. Local Authorities have a wider remit than just maximising Capital Receipt - PowerPoint PPT Presentation
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Gladedale (Central Scotland) LtdGladedale (Central Scotland) Ltd
Developer Experience of Deferred Receipt Mechanisms
Charles Church – Land DirectorGladedale (Central Scotland) Ltd
Gladedale (Central Scotland) LtdGladedale (Central Scotland) Ltd
Shift in Market Conditions
• Developers Lack of Money
• Risk
• Cash Management
Gladedale (Central Scotland) LtdGladedale (Central Scotland) Ltd
Local Authorities Responsibilities
• Local Authorities have a wider remit than just maximising Capital Receipt
• Local Authorities can be more flexible in deals
• Obliged to improve local environment, jobs, investments etc
Gladedale (Central Scotland) LtdGladedale (Central Scotland) Ltd
Methods of Disposal
• Development under Licence
• Long Lease Agreements
• Deferred Payments
“Public Sector Residential Land Disposal and Development”
Unlocking the potential of public sector land and delivering more residential development in these
turbulent times.
Steven Tolson
Ogilvie Group
Barriers to Development
Tests for this year, next year and years to come
• What is / will be the level of market activity and which sectors will be active?
• Will the Bank lend the consumer the money?
• Will the Bank lend the developer the money?
• What is the value of residential land?
Deferred Payments
• An agreed sum (no matter the performance)
RISK TRANSFERRED
• A percentage of sales income
SHARING SOME RISK
• A Profit Share
SHARING RISK
• Create a Physical Framework and look after the Public areas etc. BUILD PLACES
• Transferred serviced ground to allow house builders do what they do best. BUILD HOUSES
• Land receipts recovered expenditure and should / could have made money for the State.
A NEW TOWN DEVELOPMENT
OR
URBAN DEVELOPMENT CORPORATION MODEL
Public Sector
Promoting, Enabling and Participating
QUESTION: Is the State prepared to Participate and Share the Risk?
Joint Venture
• Public Land Asset matched by Private Cash
Benefit
• Help deliver development objectives
• Maintain some control
• Share the reward
Precedents
EDI set up some 20 years ago to largely undertake regeneration projects and other projects that the market did not wish to undertake
Model adapted by Stirling Council and North Lanarkshire Council
Fusion Assets
Wholly owned by NL Council and enters into JVs
Stirling Development Agency
JV between Stirling Council and Valad. SDA undertakes development and investments
JV Precedents
Edinburgh Park(JV City of Edinburgh and Miller)
Castle Business Park(SDA JV Stirling Council and Valad)
Image Keith Hunter
Image Paul Zanre
JV PrecedentsEdi / BurediJV City of Edinburgh Council / EDI / Burrell Co.
Drumpellier Business Park LLPJV Fusion Assets (N Lanarkshire Council) and Ogilvie
hub - SFThub will deliver projects from a core identified scope and in future from wider service development business cases, in particular those projects that promote joint working amongst community planning partners. Projects will focus on new build but could also include the refurbishment and asset management services of existing infrastructure.
hub SFT• A hub joint venture, “hub Co”, will be formed between the
public and private sector….. Although the core service will concentrate on the planning, development and delivery of new infrastructure projects for community use in health and social care, the documentation will allow for these services to be extended (at public sector discretion) both:
• in terms of scope – to include libraries, primary education, police services, fire services etc, and
• and in terms of range of service to include estate management, service planning, property development, regeneration activities.