Cost model: Garden communities

01 / Introduction

Recent announcements by the UK government, promising greater spending in the construction and infrastructure sectors, together with substantial future planning reforms to kick-start the post-covid economy, are encouraging news. In the rush to get projects up and running, the potential impact on carbon emissions must not be forgotten. The UK’s net zero carbon emissions target for 2050  means developers and their clients will need to work harder to ensure their schemes eliminate or mitigate negative environmental impacts. And if more authorities follow Greater Manchester’s example and bring that net zero target forward (to 2038 in this case), the need for new ways of thinking about planning and delivery across urban and rural areas will be urgent.

In the housing sector, the challenge is stark. The delivery of high-quality, energy-efficient homes to a sufficient scale is a priority to which most current funding models are ill-suited. There are not enough homes being built, and those that are delivered are usually not up to scratch.

Recent announcements to spend £12bn on housebuilding over the next eight years should improve the situation. Prime minister Boris Johnson’s focus on brownfield sites is positive from an environmental perspective  but these sites cannot deliver the hundreds of thousands of homes required. While brownfield sites should always be the first choice for sustainable residential projects, greenfield schemes such as garden communities can offer a lower-density alternative, offering access to green and blue spaces that improve wellbeing and encourage low carbon living. More than 400,000 new homes are set to be delivered by 2050 within 49 new garden communities – alleviating pressure on congested city centres where space is scarce.

While brownfield sites should always be the first choice for sustainable residential projects, greenfield schemes such as garden communities can offer a lower-density alternative

Rural development also offers opportunities for innovation in infrastructure, for example through a site-wide renewable energy infrastructure that could mitigate the embodied carbon of the development, and in housing systems by choosing offsite volumetric solutions that provide high-quality, Passivhaus standard, energy-efficient homes at pace and scale.

A recalibration of how we live and work following the pandemic lockdown has added further momentum to the garden communities programme. One of the dominant tendencies of the past 20 years has been to regenerate city centres and convert brownfield sites into high-density urban destinations, bringing vibrant new offerings to market alongside more traditional suburban developments. Yet the continuing need for social distancing is making us question the wisdom of living in such proximity to each other. With a covid-19 vaccine potentially quite a way off, the desire for spaces in which to live without fear of infection is real and understandable.

Perceptions around work and commuting are also shifting. The lockdown has made many people question the need for a long commute into a city-centre office. Working from home or a smaller satellite office nearby is arguably more efficient, reduces the environmental impacts of commuting, makes social distancing protocols easier to maintain and could well be better for employees’ mental health.

Garden communities are ideally suited to this new paradigm. Their mix of typologies allow for smaller work hubs as well as homes, with units catering for a diverse owner and tenant mix (including intergenerational living). The larger area of many rural sites offers a chance to rethink space standards, which in turn will support more efficient working from home.

02 / The implications of a long timescale

Greenfield schemes such as garden communities are complex and long-running. With a project taking up to 20 years to build, there needs to be clear and innovative thinking from the start to future-proof it. Developers and local authorities must embrace cutting-edge ideas now to ensure future benefits.

Part of the complexity arises from the fact that transport, energy and social infrastructure is usually significantly inadequate in capacity or even non-existent. Considered investment from an early stage is therefore required, and early, intrusive survey work may be required to confirm a site’s capacity. Some sites may take two years or more to get to outline planning approval.

The question of who pays for these early works is critical. Individual landowners may need to contribute, and developers may have to absorb costs up front. For schemes currently moving through the planning process, developers may have already paid for the land but will be tasked with retrofitting their masterplans to meet net zero carbon targets.

In all cases, whole lifecycle costs must be modelled accurately from the get-go and included in the viability model and business case

Local authorities (which may well be acting as the land promoter and facilitating the handover from landowner to developer) must work side by side with developers to help them rework funding models to face this new reality. Initiatives such as the new Transport Infrastructure Investment Fund may help. Other approaches, possibly based on existing plans such as the Housing Infrastructure Fund and the community infrastructure levy, may be required.

But in all cases, whole lifecycle costs must be modelled accurately from the get-go and included in the viability model and business case. The industry must create tools that deliver sufficient information up front and funding models that provide clarity to investors around early costs and long-term gains. The challenge is to get finances and designs right for a net zero carbon regime before schemes start to break ground.

03 / An integrated design approach

A critical success factor for large-scale greenfield schemes is a well thought-out masterplan, with firm buy-in from developer, asset owners and local authorities. This will help prevent the scheme becoming mired in planning negotiations, which is often where such projects falter. A recent report by planning consultant Lichfields found that only a third of current garden communities projects have planning permission or an allocation in an adopted plan, despite the latest iteration of the programme having been launched by the UK government in 2014 .

Part of the problem is that statutory planning processes lack a framework to deal with projects that cross local authority boundaries – often a feature of such schemes. A new approach is required that views a garden community or similar greenfield scheme as a major programme delivering wide-ranging benefits to society, rather than a stand-alone project whose only criterion is completion to time and cost. The forthcoming planning reform paper that the government is due to fast-track through parliament this autumn is hoped to include effective strategic regional plans that will define a clearer context for these larger new communities.

Comprehensive initial evidence-gathering will provide a firm foundation. Rather than testing a draft masterplan solution against an evidence base, which is the typical masterplanning approach, this brings the technical evidence to the beginning of the process so that the development of masterplan options is fully informed by that evidence. Carried out by a multidisciplinary team in consultation with local authorities, asset owners and other strategic stakeholders, this enables developers to de-risk projects and create robust masterplans that bring certainty into the planning and delivery phases.

04 / Greenfield allows green infrastructure

One advantage offered by greenfield over brownfield sites is the potential to implement a comprehensive site-wide green energy infrastructure. This should be factored into initial business cases and funding models and form a key part of masterplan development. Local authorities, developers and their designers should explore possibilities to roll out green technologies that may be impossible at brownfield sites due to lack of space or retrofit cost. 

Renewable heat sources are vital. Government regulations will prohibit gas boilers after 2025, driving take-up of air- and ground-source heat pumps that can draw increasingly low-carbon electricity from the National Grid. Emissions will drop as the grid moves towards full decarbonisation by 2032. Wider adoption will prompt further innovation around these technologies, making them cheaper and more efficient.

The lower densities provided by greenfield schemes also free up space to build more renewable energy facilities. For example, large photovoltaic arrays could potentially generate enough renewable energy to balance the operational and embodied carbon for lower-density developments, which will not usually be possible for higher-density, inner-city schemes.

We need to design and manage green space to provide a biodiversity net gain and balance wider ecosystem services such as water management, carbon sequestration and recreational enjoyment. Land previously used for monoculture crops could offer potential for gains in biodiversity. It is vital to adopt an integrated green infrastructure strategy that helps create resilience against climate change and is informed by the growing science around ecosystem evaluation. 

05 / Low-carbon, active travel

 Good transport links are a crucial part of the rural development puzzle, as any masterplanner knows. And while transport infrastructure costs need to be part of the initial business case and included in the cost model, experience shows that the additional costs of building high-quality public transport networks as part of a garden community are often relatively modest when set against overall strategic infrastructure costs.

In terms of cutting carbon, reliable and cost-effective public transport is a no-brainer. Rolling out decent municipal bus and/or tram services reduces the need for cars, which in turn frees up space across the scheme that would have had to be allocated to parking. Ideally, cycle routes, bus or park and ride services and autonomous vehicle priority corridors will link into longer-distance rail routes, for connection to major urban hubs.

If more people are working from home or from smaller satellite hubs, why not prioritise walking or cycling routes instead?

Developers should also consider approaches that rethink town planning conventions. With an element of social distancing potentially here to stay, the usual transport-oriented approach that supports high density developments may seem inadequate.  

If more people are working from home or from smaller satellite hubs, why not prioritise walking or cycling routes instead? Rather than the usual town centre clogged with traffic and fumes, whole areas could be pedestrianised, with easy-to-access support for those with limited mobility.

06 / Modern methods, better buildings

Squaring the circle of housing delivery – building more homes, faster, greener and at higher quality – must be a major objective of any greenfield or garden community programme. It is clear, however, that the methodology by which this will be delivered requires some attention. Even if current ways of doing things had not failed to achieve the volume or quality required to meet housing needs, the work required to make conventional products net zero carbon would push the cost impossibly high.

Modular and offsite volumetric solutions offer a more viable option. Building units in offsite facilities brings greater quality and control, at a faster pace than building on site with less waste. Lightweight frames require less extensive foundations, so heavy works are reduced. Precision engineered design improves performance to nearly net zero carbon, without a massive increase in cost compared with a traditional build process.

The digital design tools that allow us to design for manufacture and assembly (DfMA) will make it easier to include a more diverse mix of homes within schemes. BIM supports standardisation of components and materials while allowing variations in size and layout that are straightforward to handle through the fabrication and assembly phases.

In addition, providing within a single development multiple-bedroom homes, bungalows and apartments in a range of tenures will increase build-out and absorption rates while also balancing out community dynamics.

 07 / About the cost model 

This cost model is for a notional new garden village of about 3,000 homes on 245ha greenfield site in the Midlands/North of England. The costs are all at August 2020 price levels, and exclude the cost of the land and acquisition costs as well as finance charges, inflation, VAT and potential rebates or grants.

The model is based on a traditional approach to construction methodology.  The site is assumed to be generally level , with no ground to be made up, and access to the site is assumed to be good. It is assumed that the development will meet or exceed the government’s net zero carbon targets and will be, within reason, a self-sufficient development in terms of heat and energy production.

The details cover the work required by the master developer/site promoter to prepare the site and provide primary infrastructure and community facilities to enable parcels/plots to be disposed to others for residential-led development. It is recognised that there is likely to be some supporting employment and retail, although the predominant land use will be residential.

There are a number of different options for how the works can be procured by the master developer/site promoter, and it is recognised that overall delivery of a project of this nature could typically range from 10 to 20 years. In this respect, it is assumed that the project would have a duration on site of 10 years, equating to the average delivery of 300 residential units a year. As such, this cost model assumes that a main contractor would be appointed to deliver the initial phase of works, with the contract being subject to review for future phases.

Download the cost model using the link below