Retail giants are backing the British Property Federation’s five point plan to kickstart the construction industry through closer public and private sector working.
The BPF’s regeneration manifesto has received backing fromthe Homes and Communities Agency, retail giants Tesco and John Lewis along with Birmingham, Liverpool, Manchester and Newcastle city councils.
With the property industry marooned by lack of funding, councils and property chiefs want to pay for regeneration schemes by securing local government bonds against new tax revenue generated by development.
The bond issue – known as tax increment financing (TIF) - was pioneered in the USA in Barrack Obama’s home city of Chicago.
The idea is being worked up across the country, with the iconic Battersea Power Station in south London mooted as one scheme that could benefit from such a scheme.
The five suggestions in the report are:
- Pay for infrastructure by using the American TIF model
- Expand equity sharing – encouraging councils donate land to make development viable
- Use funding for school and hospital building to lever in more investment
- Reform EU red tape which means councils waste time and money ticking boxes to appear ‘democratic’ when selecting a developer
- Encourage a professional rented housing sector
BPF chief executive Liz Peace said today: “The property industry doesn’t want a bail out, it simply wants to work in partnership with the public sector.
“We need to get better value from our investments but that will mean that the public sector will have to put more into the pot and take less out.
“Making regeneration viable from a developer’s point of view isn’t about using public money to enhance the private sector’s profits, it is about enabling partnerships and allowing the public to benefit from what developers do best.”
HCA chief executive Sir Bob Kerslake said: “There is much here which warrants further exploration, and at the HCA we would welcome an active role in this.
“There are clearly opportunities to better combine public and private sector expertise, which we feel will be vital in bringing us through this recession in good shape.”