The Value of Placemaking Susan Emmett

Director, Residential Research, Savills

A Partnership Approach

The Right Mix

Land Value Model

LAND VALUE MODEL

ChangeToVariables

DetailsSiteHypothetical

Basic scenario

Infrastructure cost per unit£30,000

Sales value£250 psf

Absorption/sales rate 120 homes pa

Legacy scenario

+25%

Infrastructure cost per unit£45,000

Sales value£300 psf

Absorption/sales rate 180 homes pa

The importance of timing: investing more earlier

-£80

-£60

-£40

-£20

£0

£20

£40

£60

£80

Peak debtPeak debt

Land value (NPV)Land value (NPV)

Timing of bulk (60%) of additional investment

Mill

ions

Majority of investment up front Majority of investment when 40% built

-26%

56%

A PARTNERSHIP APPROACH

A partnership approach is needed

Patient capital

Joint ventures

Public sector finance

Planning certainty

THE MIX

Create demand and build communities

Schools

Sets the tone and drives values

Public realm

Retail and Employment

Investment can pay off

Demand allows homes to be provided

faster

Partnerships needed to

make it work

Government support key

Resilient places created

Summary and what next?

Thank you

© Savills 2016

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