What can landlords do to achieve the twin goals of increasing their development pipelines and investing in the local area? Russell Baldwinson at DCH explains
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There are a number of major challenges facing associations. Principle issues include a skills shortage within the development industry and a shortage in the supply of land for housing, as well as the need for organisations to diversify to support their core activities.
The construction industry does not currently employ enough skilled individuals to meet housing targets through to 2020 and this is even more apparent given the age profile of the population in the South West and the building industry.
We also have geographical challenges, being a peninsula. Our geography means we work in three rural counties, with a limited number of larger settlements. This presents its own challenges when identifying land opportunities for housing as we are also seeking to preserve the fantastic local environment.
Operating in Devon, Cornwall and Somerset, we are committed to the South West.
DCH currently manages 23,600 homes. We work closely with our local authority partners, with whom we have an excellent reputation and track record, to deliver affordable housing.
Looking forward, we are investing £600m in housing over the next five years, which will see DCH deliver more than 800 affordable new homes per annum. This compares to 608 homes for the financial year end of March 2017 and an average of 450 homes for the four years preceding this.
We have a very strong forward pipeline to ensure this ambitious target is delivered and will, whenever possible, look to deliver more if the opportunities to do so are available to us.
We have been developing homes for market sale for more than 10 years. In the last financial year DCH completed 120 new homes.
We are planning to deliver 1,100 homes for market rent and sale over the next five years, having contracted or completed on the purchase of several new land opportunities to make this a reality.
We are now very well placed to deliver land opportunities through the planning process and subsequently on site. By 2022, 34% of our activity will be either market sale or shared equity sales, thus demonstrating our commitment to alternative tenures. More recently we have also extended our portfolio to include market rent properties and have to date secured two schemes delivering homes in our two largest settlements, Exeter and Plymouth.
This is a real issue facing both the industry and our business, and recognising this means that we work hard to ensure we have good working relationships with our contractors and consultants.
An advantage we do have over many smaller businesses is the scale of our programme and the work stream this provides. Larger projects provide the security of workflow for both employers and employees and as such we have several significant projects that we are delivering in joint venture with national contracting businesses with whom we have formed strong working relationships.
We actively promote talent development, not only for our own people, but to our customers and to diverse audiences. We work, for example, with the Career Transition Partnership and Diversity Jobs. Our increasing investment in apprenticeships builds future skills for DCH and is hugely valued by colleagues as well as benefiting communities.
We have also been building the team over the past 12 months, recruiting individuals with complementary skill sets to those that we already have and to ensure our growth plans can be realised.
Attracting and retaining talent in the South West is a challenge not unique to housing associations. As an organisation with a strong employer brand, a good reward offer, a fantastic working environment and the opportunity to develop, we believe we are in a good position to attract and retain talent.
We are investing in two new headquarter buildings to accommodate more than 500 staff: one in Exeter and one in Pool, Cornwall, further demonstrating our commitment to the area. Both offices will provide an exciting and vibrant environment for our people to demonstrate their skills, abilities and passion for housing people across the region.
Why is it so important for your organisation to be investing in the local region?
The South West is an area with one of the highest disparities between house prices and income outside London and the South East, with two of our major settlements, Exeter and Truro, regularly featuring among the 10 least affordable cities in the UK for those looking to buy a home.
We generally experience high levels of housing need for new schemes and as such investing in the region is a very simple decision.
There are also much wider benefits associated with investing in new homes, both affordable and market sale, such as job creation through construction activities, helping to grow mixed and diverse communities and the subsequent investment in the area from households choosing to live in the community and our new homes.
At a time of uncertainty of revenue funding for supported housing projects, DCH is working in partnership with the Community Self Build Agency (CSBA), Plymouth City Council, the Homes and Communities Agency and the Department of Health. We are delivering a scheme for 24 apartments in the Devonport area of Plymouth.
Of the 24 units, six are being provided for general needs, while the other 18 are for ex-service personnel and those with support needs.
The difference with this scheme is that, with the support of the CSBA, the 12 ex-service personnel are actively working on the project, gaining construction-related qualifications, skills and experience, with this support continuing for another six months beyond the completion of the project.
Russell Baldwinson is group development director at DCH.
He’s a chartered surveyor with 20 years’ experience in property and more than 10 years’ experience of working for house builders in senior positions.