Planning for residential ‘value’ in London?

Housing, London

Image by David Samuel

In a seminar for the Department of Land Economy at the University of Cambridge, London WHIG team member Nicola Livingstone reflected on findings from a recently published paper that explores planning for ‘value’ through densification.

The paper explores residential densification, assessing the ongoing transformation of the Vauxhall, Nine Elms and Battersea (VNEB) Opportunity Area (OA) in London, by assessing policy and planning positions and the impact of development so far on the local housing market, from the perspective of ‘value’ creation. It questions how, and for whom, value is created through planning for residential densification. Density is analysed as a subjective and multidimensional concept and the research adopts a primarily qualitative approach, reflecting on relevant literature and wider policy and governance context through a discourse analysis relating to planning, development, investment, and densification processes in London.

As a theoretical framing the paper adopts the idea of ‘value’, in line with work by Mazzucato, using it as a lens to better understand planning mechanisms and built environment outcomes. Mazzucato suggests that governments are often seen as fixers, responding to the negative effects of value-extraction practices by global actors (such as the innovation or pharmaceutical industries), but that the public sector could, and indeed should, take more ownership of how they can become involved in actively creating value. Such a shift would reflect a move towards a broader notion of value that includes, for example, more environmental and social concerns. The paper suggests therefore that local planning authorities can become more actively involved in creating, retaining, and supporting improved value creation, to more successfully marry social and real estate related outcomes in large-scale developments like VNEB.

Battersea Power Station redevelopment

Battersea Power Station redevelopment in South London.

Key findings demonstrate how financialisation of residential real estate is underway in the VNEB, with substantial amounts of investment capital flowing into high-end luxury developments. Development in the OA has resulted in significant amounts of planning gain and affordable housing contributions through Section 106, capturing contributions towards local community and economic value through the planning system. However, provision of affordable housing in the ongoing development so far has proven to be changeable. Will densification processes end up increasing inequalities in the locality? The continued increase in rental and sales values could be positive for owner-occupiers, but problematic for renters, and might result in the longer term negative impacts of densification schemes such as gentrification or displacement, especially if institutional investors fail to integrate themselves positively into the local community. These findings reflect a gulf between international and local actors, those with capital and local communities: there is potentially a power disparity at play, even though there are clearly substantial local benefits to the project overall. Additional evidence is needed to assess the real future impacts of planning for ‘value’ in this densification context, however it is apparent that value creation through development is not value creation for all.

As with all research, more questions emerged in relation to the paper’s findings during the seminar discussion. Firstly, how do temporalities and spatialities impact planning and development outcomes: how is densification experienced in local contexts by the varied networks of stakeholders throughout the development and investment processes? How are these influenced by politics and approaches to policies? The second theme connects these questions with ideas around unequal power dynamics and considers the positionality of the planning system and developers in ensuring viability effectively meets affordable housing targets. Could a more structured and balanced approach to assessing viability through density be introduced to provide more equitable outcomes within the framework of ‘value’ we have introduced to planning? These themes and questions certainly point to more research avenues for the WHIG project to pursue moving forward, as we start to analyse our London case studies in more granular detail.

If you’d like to read more you can find the paper at: Livingstone, N., Fiorentino, S. & Short, M. (2021) ‘Planning for residential ‘value’: London’s densification policies and impacts’. Buildings and Cities, 2(1), 203–219. DOI: http://doi.org/10.5334/bc.88

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