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Why Distrust Of Developers Is A Serious Problem

It was a startling assertion.

“I saw some research which showed people thought the development sector was worse than drug dealers in its effect on local spaces,” Grosvenor Britain & Ireland Chief Executive Craig McWilliam told the 200 delegates at Bisnow’s Global Placemaking event at Olympia in West London. “That’s how low things have fallen. People don’t trust developers, and they don’t trust the planning system.”

This is a serious problem, not just for developers, but for society. As McWilliam pointed out in a keynote interview with Cluttons Head of Real Estate Management John Gravett, cities like London need development to house their growing population and build the workspace needed by companies big and small.

Grosvenor's Craig McWilliam and Cluttons' John Gravett

Building trust with communities where major developments are occurring will be vital. But the problem is far from simple and will need a change in thinking from both developers and local authorities.

McWilliam was speaking from bruising recent experience. In February, Grosvenor’s plans for a £500M build-to-rent scheme in Bermondsey were rejected by planners in Southwark due to issues surrounding affordability.

“People love the spaces that are created, but they distrust the process, and that holds us back from fulfilling our purpose,” McWilliam said.

He called on political leaders to stress the benefits of new development.

“People see new developments that are going up and think everything is just luxury flats, developers are just out for themselves and the local authority has probably been legged over.

“If there is a school that gets funded as part of a new scheme, then the benefit is often taken by the local authority, and the community doesn’t see the benefit as coming from developers. It needs public leaders to stand up and talk about how development brings benefits.”

But ultimately the real estate industry must make the case for what it does itself and better engage with local communities, particularly those people who might not have previously engaged with the development process.

“The planning process gets captured by the small group of people who object, and we need to bring in the people who don’t typically make time, or who might not even know that there is a process to engage with. Those people are disempowered.”

McWilliam said Grosvenor had tried to go beyond the typically consultation meetings by utilising social media and apps, to get its message out to people unwilling to make the physical journey to engage.

In an effort to go further, it is pursuing a fascinating experiment. Grosvenor is undertaking a large-scale survey of what people like and dislike about the planning process. It will take what it learns from this poll and apply the lessons to one particular scheme to see if it can better engage with people.

Meeting face-to-face remains a crucial tool in engaging with the communities around major new development, and it is important to go the extra mile, according to Yoo Capital Managing Partner Lloyd Lee. Along with joint venture partner Deutsche Finance, the company is undertaking a £700M redevelopment of the Olympia exhibition venue.

Olympia in West London

“If you are going to be in a community, then be in a community properly,” Lee said. “We undertook 63 days of community engagement during the planning process, and when Mrs Jones from round the corner called us up to say she couldn’t make a meeting, we opened up a 30K SF hall just for her the next day. It takes time, but people are learning to trust us.”

Lee said Yoo and Deutsche Finance had opened up the space to allow access to local theatre and community groups, and that even though it had now received planning consent for the scheme, it was continuing the consultation process to keep local residents informed.

And what of Grosvenor and Bermondsey? McWilliam said the company would continue to push the benefits of a BTR scheme it feels doesn’t fit the normal economics of development in London, where building lots of expensive flats for sale subsidises affordable units.

“We’ll continue to see whether there’s a way of increasing understanding of the benefits of the scheme, whether with the greater London authority or with Southwark,” he said.

It is a tough problem, but one the development world simply has to solve.