IPI Submission on Unfinished Estates Guidance Manual
Wednesday, January 12, 2011
Ms Katherine Banks
Housing and Sustainable Communities Agency
Cumberland House
Fenian Street
Dublin 2
12th January 2011
Dear Ms Banks,
The Irish Planning Institute welcomes the opportunity to make a submission on the consultation draft document ‘Managing and Resolving Unfinished Housing Developments - Guidance Manual’. Our submission is informed by the collective opinions of experienced planning practitioners in both the public, private, and academic sectors.
The submission makes specific comments on topics contained in the Draft Guidance Manual and also includes additional comments on the overall document.
General Comments
The management and resolution of unfinished housing estates requires a collaborative approach and while the document highlights the need for interdisciplinary input, the Irish Planning Institute considers that more emphasis should be given to the requirement to assess unfinished estates in the context of the proper planning and sustainable development of the area. In this regard, while there are housing, engineering, planning, financial, social and design issues to be taken into account, an overseeing role in this process should be provided by planning staff and planning practitioners for their role as strategic thinkers. The Institute would welcome a greater emphasis on the role of planners and planning in the managing and resolving of unfinished housing developments in this regard. Unlike engineers, technicians, and administrative roles in Local Authorities planners are trained in strategic planning and collaboration with other disciplines. In this context it is appropriate that the process be led by a suitably experienced planner in each of the affected Local Authorities.
The Irish Planning Institute welcomes the proposal to introduce the Site Resolution Plan approach, however the Institute considers that these plans should evolve from evidence-based planning assessments rather than submissions assembled by developers/financial institutions themselves. Such plans require significant planning and evidence-based analysis, assessment of local market demands, examination of core strategies and local development plans, and the cumulative impact of similar plans in the area. The theory of the preparation of Site Resolutions Plans is a revolutionary approach which is supported by the Institute, however we consider that such plans require an in-depth knowledge of planning policy and recent changes to planning legislation along with the skills, training and experience in designing, maintaining and enhancing desirable places to live, work, and play. The Site Resolution Plan concept should not be promoted as a tick-box exercise by developers or financial institutions, rather as an evaluation of the unfinished estate in the context of proper planning, maximum financial gain, evolving from an informed, evidence-based assessment of all available options.
Planning for the common good is modeled on core values which protect and enhance the quality of life for future generations. This current situation should be embraced as an opportunity to reassess the need for and quality of the stock of partially completed housing developments in the context of a boom-less economy. The Institute sees their role in this process as a driver for creating balanced and desirable places to live, derived from a more sustainable social value system.
In order to create meaningful, evidence-based Site Resolutions Plans, planning-based assessments must be carried out by qualified, experienced practitioners. In turn cumulative Site Resolution Plans should feed into a larger ‘Area Resolution Plans’ prepared by Local Authorities for towns and villages which have multiple unfinished housing developments. It is only in this context then that a holistic assessment can be made by Planning Authorities with multiple unfinished estates. These ‘Area Resolution Plans’ would then highlight any outstanding housing need or oversupply and should feed into the evidence-based core strategy for the plan area. In addition there is a need to outline longer-term policies for unfinished housing estates in the Regional Planning Guidelines, Development Plans and Local Area Plans.
It is in this context that the Institute considers the importance of the preparation of the Site Resolution Plans and the need for this manual to set out the long-term benefits of employing experienced planning practitioners for the preparation of same. In this regard, the Institute provides, on its website, a list of professional planning consultants who would have the necessary skills and competences to provide this service. This would ensure that the preparation of the Site Resolution Plans is an impartial, evidence-based process resulting in the most appropriate action to be taken with regard to each unfinished estate.
Specific Comments
Proposed additional text underlined in red. Specific comments regarding text also included.
· Page 7
“1.4: Addressing Unfinished Housing Developments – New Challenges
The prolonged nature of the construction downturn poses new challenges in addressing issues related to the management and resolution of unfinished housing developments such as:
Extensive compliance problems with developments in relation to planning, building control and other regulatory requirements, some of which have been evolving as for example new building regulations come into force;
Developers, not being able to access the funding necessary to comply with planning and other requirements and/or complete developments; going into liquidation;
Securities lodged with the relevant local authority to ensure the satisfactory completion of essential infrastructure and services expiring and/or being difficult to liquidate and/or renew; none lodged despite development having commenced; insufficient bond amount having been conditioned to enable completion of entire estates;
Private maintenance arrangements not working or being effective due to inadequate initial start-up capital, inherited deficiencies of the development and inadequate revenue stream and all because of under-occupation of developments;
Enforcement of planning, building control and other requirements being difficult because of the difficulties in securing and executing court orders, especially given the issues above;
developers dissolving companies at enforcement stage rendering legal action impossible; because permissions are still live and enforcement not possible until permission expires; developers gone/not in the country; companies dissolved, weak/legally unenforceable planning conditions; old planning conditions which are not in line with current standards; and
Uncertain longer-term viability of part occupied and/or complete developments and the challenges, in finding long-term uses for such developments that are sustainable in economic, social and environmental terms; maintain and completing services to residents that are pepper-potted throughout largely unfinished estates; dangerous structures/derelict sites legislation and health and safety legislation can have detrimental visual impact on longterm residential amenity.”
“Notwithstanding the challenges above, where developers are still in place and/or where a financial institution acting in possession as charge-holder on a property has appointed a receiver, the issues above should be capable of being addressed over time.”
Comment: The Institute also recognises that there are issues regarding Planning Authorities becoming statute barred from enforcement, this matter should be addressed also as medium and long term Site Resolution Plans may well fall foul of this technicality if developers fail to comply with agreed Site Resolution Plans. In addition there are issues with the low costs being awarded to planning for unfinished estates from liquidators – planning is almost always far down on the list of creditors in this regard. This leads to a serious shortfall in finance for the carrying out of essential works for basic services and infrastructure in estates.
· Page 8
“Developers and property owners must first and foremost ensure that their development sites, whether active or inactive, are safe and secure from unauthorised access and that they are working with other stakeholders to comply with planning, building control and other relevant consents to ensure the delivery of good quality and attractive developments that maximise return on investment;”
Comment: Increasingly more common are situations where developers are not cooperative with Planning Authorities at all.
“Financial Institutions including NAMA and receivers will adopt a strictly commercial stance in assessing the best course of action to optimise value and, subject to their objective of maximising loan repayment and taking each individual situation on its merits, will cooperate with all other stakeholders in resolving unfinished housing developments in compliance with statutory consents and requirements;”
Comment: It is imperative that NAMA and receivers consider the proper planning and sustainable development of an area when assessing the merits of a site. Adopting a strictly commercial stance and failure to properly evaluate market demand and buyers requirements may lead to the completion of estates that should have otherwise been made back into Greenfield sites. The cumulative impact of such decisions by numerous receivers may have irreparable impacts on local communities.
· Page 10
“The structural safety of unfinished developments can also be a short-term priority issue as partly constructed housing developments can become structurally unsound (e.g. gable walls left exposed to wind pressure may collapse). In this regard, the Local Government (Sanitary Services) Act 1964 places obligations on property owners and gives certain limited powers to Sanitary Authorities in relation to dangerous places and dangerous structures to either require the owners of such properties to make them safe or for those authorities to step in, do the works and recover the costs of such works from the owners of the relevant properties.”
Comment: Are these costs recoverable where developers are gone, or the relevant company is dissolved? In terms of companies which are in liquidation, costs such as these claimed for by Local Authorities are realistically not going to be covered by liquidators.
· Page 11
“With regard to (2) above, housing developments will normally be approved on condition that the developer lodges with the planning authority an appropriate security, usually in the form of an insurance bond or in some limited cases a cash deposit which will only be returned when essential services and amenities have been provided in accordance with the terms and conditions of the planning permission.
However, as insurance bonds are usually issued for set periods of cover, ensuring that developments are adequately covered is an ongoing priority action for planning authorities.”
Comment: Where bonds were not received, were received in part, or where they have lapsed – Planning Authorities cannot proceed with remedial works. In addition if planning authorities call in a bond, they should then be taking the estate in charge – but where bond is insufficient to carry out all required works Planning Authorities will obviously not want to take an unfinished estate in charge, especially with regard to estates where essential services such as water, waste water, footpaths, lighting or roads remain in an unsatisfactory state.
Bonds have regularly been under-valued – they are based on the need to complete unfinished elements of an estate – it was never envisaged that bonds be used to fully complete dwellings, services, roads, footpaths, lighting etc. where bonds are insufficient to complete an estate – list of priority works to be carried out with bond. Some guidance with regard to these situations should be provided.
· Page 13
“Local Authority Unfinished Housing Development Team: Key Responsibilities”
Comment: This section should include a paragraph on the preparation of ‘Area Resolution Plans’ as per our general comment at the beginning of the submission.
· Page 14/15
“Site Resolution Plans will normally be prepared by an IPI approved planning consultant either on behalf of:
The developer, as part of a request for additional working capital to the developers funder; or
A receiver appointed by a financial institution seeking to recover assets.”
-
Page 15
Replace the following paragraph:
“A Site Resolution Plan should set out a longer-term framework for the ultimate usage of a given site that represents a good and balanced outcome for any residents in a given housing development, the local authority, the developer and funder, based on proper business and economic appraisals.”
With:
“A Site Resolution Plan should set out a longer-term framework for the most appropriate use of a site based on the principles of desirable community and social objectives economic viability and the proper planning and sustainable development of the area in the interests of the common good. The preparation of a Site Resolution Plan should be grounded on evidence-based market demand and economic circumstances, current design and living standards and should represent a balanced outcome for residents, communities, the local authority, the developer and funder.”
“The SRP should set out an agreed way forward in consolidating and/or finalising the development of part, or all, of the site in question, taking into account the relevant planning, housing, infrastructural and amenity issues and the concerns of any residents.”
Comment: The SRP should be prepared in line with current economic circumstances; evidence-based demand; any Local Area Plan/Development Plan policies and/or objectives for the region; local residents and/or local community groups/voluntary housing groups.
· Page 16
“Tangible outcomes from such a process might include the renting of vacant properties for community development, education and training purposes, the improvement of amenity areas or the establishment of community management teams.”
Comment: It is commonplace for Local Authorities to be faced with communities who do not want to take any role in the resolution of the unfinished state of their development. In reality the residents feel hard done by, disillusioned, and many are in financial difficulty already, and do not want to get involved in the resolution of the development. Anger and resentment at developers/companies is evident. It is evident that residents very often do not feel any sense of ownership for these developments – and as they see it - they do not want to be punished for developer’s inability to complete estate. In a lot of cases there are too few residents in these estates to support viable community groups or residents associations.
· Page 19
“4.2: Bonds and Securities
A second immediate priority with regard to unfinished housing developments is to ensure that the planning authority monitors the housing developments in its area to ensure that they are covered by an up-to-date bond or other security such as a cash deposit, for the satisfactory completion of essential services and amenities.”
Comment: Some guidance is required with regard to instances where:
· There was no bond or security lodged
· Developer/company has dissolved and therefore no one to follow in terms of enforcement
· Calling in the bond would not fund basic infrastructural services to be carried out – do the Planning Authority then have to take this estate in charge despite it being incomplete?
· Liquidator sets out amount Planning Authority in respect of outstanding bond/contributions is to receive and it will not cover basic infrastructural services to be carried out
· Planning Authority are statute barred from enforcement action
“Recognising the current difficulties in raising bond-type securities, it is also good practice for local authorities and developers to consider the full range of mechanisms available. Such mechanisms might include:
· Cash deposits;
· Insurance Bond; and where neither of the above are available;
· Title over specified parts of the development (e.g. in the case of part-completed developments completed but vacant dwelling units) that would be returned, subject to verification that essential services and amenities have been provided in compliance with the terms and conditions of the relevant planning permission.”
Comment: Taking title over complete vacant units in this market may not be a financial gain – especially if the services are not in situ, and underground services are not to PA’s satisfaction. In addition if Planning Authorities take over title for units they must then be insured and become the responsibility of the Planning Authority i.e. vacant units may suffer vandalism, become run down due to being vacant as set out in section 4.3.1.
· Page 26
Comment: Section 5.5 deals with powers of a Local Authority under the Derelict Sites Act 1990. The operational issues with this Act are that it does not take into account visual amenity and/or residential amenity for residents and the local community. Short-term health and safety solutions can become a long-term fixture, especially where developers/companies have dissolved, gone away or go into liquidation. The impact on residential amenity and the visual aesthetics of a village/town, in particular in areas where there are multiple unfinished estates is an on-going concern for communities, residents and Planning Authorities.
Ultimately, the Guidance Manual is intended to guide the management and resolution of unfinished housing developments through the relevant stakeholders. While the Irish Planning Institute welcomes the Manual, there are pertinent issues that have not been addressed by the consultation document, which this submission highlights. Respectfully there are also practical and implementation issues that we have highlighted which we consider require further consideration and guidance.
The role of the Irish Planning Institute in relation to unfinished developments is to promote and encourage the completion of vibrant sustainable communities. Unfinished and partially complete housing developments should only be completed where it is established that the areas will enhance the lives of the people who will live, work and recreate in them. It is the role of all stakeholders to facilitate the creation of economically viable developments, with evidence-based market demand, that encourage vibrant sustainable communities, which are desirable to live in.
The predominant requirement is that a planning-led holistic approach to the resolution and management of unfinished housing estates is employed, resulting in desirable communities in the interests of the common good.
If you wish to discuss any areas of this submission I would invite you to contact Emma Pillion,
IPI Council Member on 087 915 6852.
Yours sincerely,
Gordon Daly MIPI
President
Irish Planning Institute