British Property Federation launches Covid-19 recovery roadmap
- Real estate investor-developers reduce intended spend on UK development by £1.2bn
- With the right policy support, however, the real estate sector can invest in people, property and places
30 June 2020, London: The British Property Federation (BPF) launches today its Covid-19 recovery roadmap Building a Shared Recovery, to enable the real estate sector to deliver the private sector investment that will be essential to support the Government’s ambitious investment plans and its ‘levelling up’ agenda.
The BPF’s Building a Shared Recovery is an holistic framework with immediate and longer-term policy suggestions – to feed into both the Chancellor’s recovery measures in July and the Autumn Statement later this year – to better support investor-developers, the construction sector, and businesses and communities across the UK.
The BPF urges the Government to adopt the plan’s recommendations, as real estate investor-developers currently plan to reduce vital investment in the UK by £1.2bn in the financial year 2020-2021.
BPF members – the UK’s leading property investor-developers – were surveyed for their intended spend pre-Covid-19 on new development projects in the UK during the financial year 2020-2021 and, when considering the impact of coronavirus on the economy, whether they have since revised the total volume of intended spend.
Respondents revised their intended spend by £1.2bn – a total of £3.9bn has been reduced to £2.7bn.
The survey included investor-developers with interests in retail, offices, mixed-use and residential property.
Building a Shared Recovery has been published in full on the BPF website here, and includes –
To support town centres – to drive more investment into creating more responsive, fit-for-purpose high streets and urban centres, new government policy should include:
- A Furloughed Space Grant Scheme – to support occupiers in covering their fixed property costs whilst recovering from the impact of forced closure
- A high street ‘use’ for planning purposes
- A temporary relaxation of Sunday Trading Hours to help provide increased job opportunities for younger workers
- More use of Local Development Orders
- A temporary reduction/removal of Stamp Duty Land Tax on high street property transactions
- Business rate reform – and start by immediately abolishing downwards phasing to ensure rateable values can better reflect rental values
- Introduce Community Improvement Districts, whereby a small council tax supplement (based on a local improvement plan and vote amongst residents) could be structured to support a particular retail place
- Introduce an Entrepreneurs’ Space Rebate, whereby empty rates paid in the previous 12 months should be rebated to a landlord if it provides space to a start-up or SME for a minimum of 12 months’ successful occupation
To support housing supply – to drive more investment into the delivery of new high-quality homes, new government policy should include:
- A temporary exemption for institutional investors in the build-to-rent housing market from the 3% Stamp Duty Land Tax surcharge
- A brownfield land presumption in favour of build-to-rent housing
- Government funding for Homes for Heroes – a national programme to deliver low-cost homes for the NHS heroes who have put themselves at risk throughout Covid-19
- New Government funding for social housing in support of the National Housing Federation campaign ‘Homes at the Heart’
- Update the National Planning Policy Framework to ask all Local Authorities to have an explicit planning policy on housing for the elderly
- A national retrofitting programme – as committed to in the recent Conservative Party election manifesto including reduction of VAT on residential repairs, maintenance and management
- Lifetime ISA support for renters
Mitigating climate risk must be central to recovery.
The Government has yet to be clear about how it is going to align Covid-19 recovery policy with its ambitious environmental goals, but we urge Government to ensure that it is an exemplar in its own investment programme and considers how all of its policies – including those contained in this BPF Building a Shared Recovery roadmap – can be used to incentivise faster progress towards net zero carbon and environmental net gain.
Melanie Leech, Chief Executive, British Property Federation comments:
“The Government’s ambition to invest in infrastructure and the built environment is welcome but will only be delivered in partnership with private sector investment and activity.
“Real estate investors are clearly concerned about the year ahead as they are impacted by Covid-19 and the Government’s action to restrict their commercial rights, and as they divert resources to support their residential and commercial tenants. Any reduction in new development in our towns and cities will apply significant pressure on construction jobs and local economies.
“Commercial real estate will be at the heart of delivering economic and social recovery, levelling up the country and rebalancing regional economic inequalities. Getting people back to the workplace, and onto our high streets and into our shopping centres, supporting new entrepreneurs, and unleashing the capital that is ready to invest in new homes, environmental improvements and business premises should be central to recovery.
“The proposals in our Building a Shared Recovery plan should help to reassure investors of the Government’s support for the real estate sector, and to enable the sector to maximise its role in supporting the UK’s future. With the right policy framework, underpinned by a new sense of bravery and creativity to support us in overcoming the challenges ahead, we stand ready to work as supportive partners investing in people, property and places.”