Strange bedfellows

We are constantly being told that successful regeneration requires partnership between the public and private sectors. Private developers bring knowledge of the market and cross-subsidy. Councils, registered social landlords and other public and community bodies bring essential strategic direction, vital community support and scarce brownfield land.

Partnership has potential spin-off benefits for both sectors and both sides have an interest in making the project a success. But regeneration can easily flounder on the practicalities of achieving joint working.

How can we bring partners who differ so much in background, culture and objectives around the table to achieve shared results? And what more formal options are available for tying councils/RSLs and developers into joint-working models? We need to examine ways of managing the relationships between partners. Here are some practical tips:

Understand what makes you tick

The aim is to ensure that genuine listening takes place so that the aims of each stakeholder are understood and acknowledged. These drivers may be complex and nuanced and involve both positive objectives and the avoidance of “risk”.

Do not tolerate stereotypes

In many organisational cultures, legends form around perceived ideas of people. I have heard comments such as: “You’re only in it for the profit – what about the community benefits?” from the public sector. And: “What do the public sector community agencies do all day? They have so many people and yet deliver so little,” from the private sector.

It is critical that stereotypes and untruths of this kind are challenged.

Widen your definition of regeneration

In the context of housing, regeneration may cover physical buildings and environmental, social, community and employment benefits. Non-physical elements may not be acknowledged by more conservative partners in traditional housebuilding. Similarly, commercial elements are sometimes lost in community benefit forums. All participants need to understand regeneration in the broader sense.

Deliver through a shared ethos

Over the lifetime of a project, differences will occur between partners. This is seen most graphically in planning appeals where relationships between a housebuilder and a local planning authority can be at their most antagonistic. Those who seek to champion partnerships must protect decision-making

by agreement in the face of all pressures. Often, the vocabulary between partners can act as more of a barrier than a bridge.

Get delivery structures in place

Trust is engendered through the delivery of promises, whether in timescales or quality standards. So it is incumbent on partners to adequately resource the delivery of objectives. The temptation for developers is to achieve ultimate targets such as unit completions while ignoring less high-profile milestones along the way (such as community engagement).

Get after-sales service right

Community/tenant complaints and defects can do much to undermine a relationship. Defects reporting procedures and processing to the point of resolution are critical in building community cohesion and reinforcing the message that the housebuilder is committed for the long term.

Have strong leadership and vision

Partnership can only deliver a limited set of benefits, each benefit being carefully costed through the process. There are limits to the degree to which private companies can

cross-subsidise public benefit and there are similar limits to the amount of leverage public sector support can draw in from other players.

In public sector bodies, clear leadership is required to set down and communicate objectives that are achievable and those that are not. This can be painful, but is essential in clearly directing regeneration efforts without unnecessary delays and conflicts.

Share risks and rewards

Regeneration sites involve risk for housebuilders in terms of existing low demand and house prices that make the area uneconomic to develop. Councils also manage risks. I have often heard council officers express concerns that developers will generate “excess profits”

and that this will be picked up through the media. RSL risks often involve their ability to deliver a cleared site ready for regeneration. Non-performance will have adverse effects on delivery programmes, with consequent penalties.

There are now established processes for sharing risk and reward. On many regeneration sites, the partners have agreed overage clauses in the development agreement. These may be based on sharing any net uplift in sales values between partners and/or any net increased value arising from higher densities achieved through the planning process. The bedrock of these calculations is an agreed baseline appraisal of costs and revenues at the outset.

The cultural reluctance to embrace open-book working in more conservative sectors of private housebuilding should not be underestimated, however.

Here is how Tony Quinlan of Narrate Consulting sums up the dangers of mistrust: “People make too many assumptions on each side of the public/private debate … and when we’re talking about real change, culture change, these are not just mistakes, they’re dangerous assumptions that sabotage the best efforts of the change makers.”