Sustainable Urban Regeneration

Insights and Evaluation from a UK Housing Association

Kevin Dean, Claudia Trillo, Angela Lee

• Verlag: Routledge
• Jahr: 2022
• ISBN:
  9781000546668
• Auflage: 1
• Thema: Architecture
• Thema: Urban Planning & Landscaping

This book provides a deep insight into urban regeneration schemes and explores the parameters of what is deemed a sustainable development, before appraising existing schemes' evaluation models for the sustainable return on investment. The authors present a new practical evaluation tool that suggests quantifiable benefits for all urban regeneration stakeholders.

This new method enables the gauging of the full sustainable impact, from a given outlay of money invested in a housing-led urban regeneration scheme, through an evidence-based proof and can be used to:

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• Better fulfil sustainability criteria in terms of all three aspects of the triple bottom line and contribute in a more sustainable way to address the United Nation's Sustainable Development Goal 11

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• Reduce financial waste and plug the gap created by the recent economic shortfall which is impacting on housing associations, tenants and communities alike

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• Evaluate historical housing-led urban regeneration schemes and model future schemes.

The method can be used as a strategic decision making or management tool, with schemes being able to be planned in, prioritised or carried out in a targeted and strategic manner; and it can be used for modelling purposes, for publicity purposes and alongside existing tools. This book provides a unique method of fully and sustainably evaluating housing-led urban regeneration schemes, useful for planners, strategic management, local authorities, housing associations, the construction industry and built environment students alike.

1 Introduction The UN Urban Agenda, economic climate and solutions for housing associations

DOI: 10.1201/9781003043881-1

Introduction

Urban regeneration has a substantial impact to play on all three dimensions of sustainability –often referred to as the three pillars: society, economics and the environment – or more commonly termed as the triple bottom line (Elkington et al., 2007). It is therefore an activity of considerable importance in achieving a more sustainable society. The UK Government has integrated the goal of sustainability into urban regeneration policies, yet the proliferation of definitions and conceptualisations of sustainability render the term to be so poorly understood and slippery that it can be easily misinterpreted, or at worse, even manipulated.

The new 2016 United Nations’ (UN) Urban Agenda reaffirms the concept that sustainable cities require both environmental and social sustainability, and with this introduced 17 [interconnected] Sustainable Development Goals (SDGs)that support a better and sustainable future for all by addressing issues relating to poverty, inequality, climate change, environmental degradation, peace and justice (see https://www.un.org/sustainabledevelopment/sustainable-development-goals/). With goal 11 (SDG11) – that of making cities inclusive, safe, resilient and sustainable – a target of sufficient and affordable housing has been set (https://sustainabledevelopment.un.org/sdg11). Despite housing’s central role and importance in ensuring sustainability (Hills, 2007), and despite the importance of both the environmental and social pillars of the triple bottom line in ensuring sustainable development (Elkington et al., 2007), current evaluative methods that support decision making on social housing interventions still fail in capturing all of the socio-environmental spillovers of the UN’s SDG11. This book contributes to addressing this issue by providing decision makers with a new evaluative tool, namely ‘SuHousingImpact’, building on and taking forward the Sustainable Return on Investment (SuROI) approach (Bichard, 2015), and allowing the successful capturing of such socio-environmental spillovers in housing-led regeneration schemes.

The book introduces and covers the subject domains of urban regeneration, with a focus on housing-led regeneration, together with sustainable development and evaluation. In addition to this, existing methods of evaluation of housing-led urban regeneration schemes are critiqued. The approach of SuROI (Bichard, 2015) is introduced as an extension of the Social Return on Investment (SROI) methodology, which has been used within the context of the built environment previously (Aspden et al., 2012; Bichard, 2015; Bridgeman et al., 2015, 2016; Watson et al., 2016; Watson and Whitley, 2016).

The research in this book links in with the concept of “social innovation”. Social innovation is a domain which is becoming “increasingly evident in policy [and] scientific and public debates” (Howaldt et al., 2014) and is considered as being “increasingly influential in both scholarship and policy” (Moulaert et al., 2013), with a growing consensus emerging amongst practitioners that “widespread social innovation is required to cope with the significant challenges that societies are facing [both] now and in the future” (Howaldt et al., 2014). The concept has been referred to as “a new combination of social practices in certain areas of action or social contexts with the goal of better satisfying or answering social needs and problems than is possible on the basis of existing practices” (Ibid, 2014). Specifically, this involves ideas which have been subsequently turned into practical approaches (Evers et al., 2014).

Social innovation approaches have been said to be important for finding solutions to the interconnected challenges of global and sustainable development (Babu and Pinstrup-Andersen, 2009), whilst the significance of methods and technologies has been widely acknowledged to be central to innovation studies (Howaldt et al., 2014).

Such innovation is outlined in this book, which consequently leads to the creation and unveiling of the novel ‘SuHousingImpact’ tool, useful to sustainably evaluate housing-led urban regeneration schemes in both an ex-ante and ex-post context. This book demonstrates the implementation of the tool on two real historical case studies from a leading housing association based in the North West of England, UK, through two extant housing-led regeneration schemes – a not-for-profit housing association; those schemes being an environmental-led scheme and a high-rise scheme, with results showing that the environmental and social spillovers are largely disregarded because of a gap in the evaluation methods and that room for significant improvements exists. This proves the importance of the ‘SuHousingImpact’ tool, which allows the unveiling of hidden social and environmental benefits from housing-led urban regeneration schemes and therefore supports a better alignment of current practices to the pursuing of the SDG11. It is hoped that this new tool can be used to better inform and evaluate when compared to previous methods of evaluation in urban regeneration.

Background and context

Economic climate and consequences for housing associations

Housing associations are currently operating under severe financial constraints, which make the decision making process extremely demanding, since every choice needs to be thoroughly assessed in terms of benefits. This situation has become particularly harsh in recent times, while in the past less scarcity of resources allowed more flexibility in choices. Before the economic crash of 2008 in the United Kingdom, housing associations could rely on significant bank financing to fund their development. Banks and other lenders historically provided housing associations with loans in favourable terms. Until the advent of the credit crunch, banks priced loans to housing associations at 20–30 basis points above the London interbank lending rate (House of Commons, Communities and Local Government Committee, 2009). However, once the credit crunch came about, not only did banks charge more for new loans, but they also sought to rewrite the already existing housing association loans they had outstanding. Those housing associations seeking additional financing found that banks demanded rates as high as 300 basis points above LIBOR (London Interbank Offered Rate), often more than ten times higher than their previous rates. A number of lenders refused altogether to lend to housing associations (Hilditch, 2009; House of Commons, Communities and Local Government Committee, 2009). Banks also sharply increased the cost of credit for housing associations, whilst demand for for-sale homes and shared-ownership housing plummeted, reducing revenue for housing associations (Dowler, 2009). More recently as part of the housing white paper, the UK Government has announced that rent decreases (explained further below) are to remain in place until 2020 and that there remains a focus on Right to Buy (UK Government, 2017).

Housing associations had increasingly been building housing for sale in the open market to generate additional revenue to help fund the development of social housing. However, the financial crisis in 2008 left housing associations with thousands of unsold housing units, whilst additionally reducing the market value of the associations’ housing stock and land holdings. Additionally, housing associations’ ability to generate funds to support the development of social housing was curtailed, whilst the crisis also reduced the amount of housing acquired from private developers through Section 106 agreements (planning obligations under Section 106 of the UK’s Town and Country Planning Act 1990 is a mechanism which makes a development proposal acceptable in planning terms, that would not otherwise be acceptable). A reduced revenue subsidy for housing, notably via housing benefit, has contributed to the financial difficulties that housing associations currently face. In addition, a reduction of welfare support will impact on the ability of tenants to pay their rent, whilst the cutting of rent paid by tenants by 1% has added to the challenges faced. To cap it all off, the Right to Buy scheme can force associations to sell at huge discounts. Added to this, falling wages and a lack of employment contributes to these issues, all this at a time when social housing is likely to be in even greater demand (Chevin, 2013), putting even more pressure on housing associations. Consequently, housing associations have had to be more economically aware. Poor decision making can have major consequences. It is therefore important to make sure that investment is used efficiently, and that the amounts of money which are available are not wasted.

Presently, the economic climate is now even more demanding; additionally, with the added impact of the recent world pandemic of Covid-19, it is increasingly important that the evaluation of housing-led urban regeneration schemes is of a high standard, and that the conclusions coming about from a particular evaluation are accurate. To this end, it is imperative that all benefits arising from a particular scheme are taken into consideration, and that as much information as possible on the scheme impacts is available for strategic decision makers. However, there is an absence of frameworks available to assess impacts in terms of sustainable development on the built environment (Thomson et al., 2009), or certainly a limited number of such frameworks (DETR, 1998; OECD, 2000); and the absence of appropriate frameworks has often been considered as playing a part in the inability to deliver the desired objectives of urban regeneration schemes (Kazmierczak et al., 2009) which can have negative repercussions, especially when taking into consideration the aforementioned current economic climate, when money is not always readily available and mistakes are potentially costly. Along these lines, Tyler et al. (2013:171) pose the question as to why, despite the resources that many countries commit to urban regeneration, has there been “so little evidence available on the aggregate value of regeneration benefits?”

Economic climate, its effect on housing associations, the resulting problem and potential solution

A housing association’s core role is to provide housing for those who are in greatest need. The sector in the United Kingdom contains the largest number of professionally managed properties (approximately 3.9 million, 17% of all households; MHLC, 2019), and as such, has a significant role to play in improving the country’s economic, environmental and social sustainability. Improving the sustainability of existing housing stock is a major challenge facing the UK social housing sector, for which there is little support to navigate the growing and often incongruent information relating to sustainable development and how to operationalise it.

The housing association sector has typically been underpinned in previous years by high levels of capital subsidy from the UK Government (Malpass, 2005), with the majority of revenue being funded indirectly through Housing Benefit (Steele, 2012). In recent times, there has been a change from local councils, to now housing associations developing most rental housing, initially receiving substantial government funding to do so (Schwartz, 2011). Nowadays there involves a greater reliance on private actors, market mechanisms and commercial capital, with the shift being described as a “migration from the public sector towards the private market” (Blessing, 2015:198).

However, despite this new commercial direction, things have become more difficult for housing associations in recent years since the economic crash of 2008 and the economic catastrophe that is Covid-19. According to Evans et al. (2016), the financial crisis “affected the housing sector the hardest”.

Specific areas have consequently contributed to the necessity for change in the way housing associations do business, resulting in a more commercial approach being taken. Firstly, a reduced revenue subsidy for housing, notably via housing benefit, has contributed to the financial difficulties that housing associations currently face. In addition, a reduction of welfare support will impact on the ability of tenants to pay their rent. Added to this, falling wages and a lack of employment add to the issues, whilst social housing is likely to be in even greater demand (Chevin, 2013), putting even more pressure on housing associations.

The change to welfare support is another driver for change. In late 2010, the UK Government began a radical overhaul of almost all aspects of welfare support. Central to these reforms was the government’s aim to reduce the nation’s benefits bill, particularly in relation to housing benefit. Because housing benefit is no longer paid direct to the housing association via direct debit, this can affect their rental income. In addition, the so-called ‘bedroom tax’ (in 2016, the UK Government introduced an under-occupancy penalty/charge from the Welfare Reform Act 2012 whereby tenants living in social housing with rooms deemed ‘spare’ faced a reduction in Housing Benefit, resulting in them being obliged to fund this reduction from their own incomes or face rent arrears and potential eviction) has added to the challenges faced, whilst the Right to Buy scheme can force associations to sell at huge discounts.

Bearing the economic effects of the credit crunch in mind, housing associations have tended to react by attempting to plug monetary gaps via a drive to be more commercial. Chevin (2013:7) writes that many housing associations were looking at accomplishing “greater value for money and better asset management”, together with looking into the possibility of additional income streams. Housing asso...

Inhaltsverzeichnis

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• List of abbreviations
• Foreword
• 1 Introduction: the UN Urban Agenda, economic climate and solutions for housing associations
• 2 Urban regeneration and sustainable development
• 3 Evaluation: its background and history within urban regeneration
• 4 Social Return on Investment (SROI)
• 5 Sustainable Return on Investment (SuROI)
• 6 An introduction to a new stakeholder-led evaluation method: SuHousingImpact
• 7 The SuHousingImpact method explained
• 8 Case studies
• 9 Concluding remarks
• References
• Index