Should You Be Worried This Man Is Re-Writing Andy Burnham's Property Plan?
His closest aide is a Momentum organiser — and he voted twice for Jeremy Corbyn in Labour's leadership battles. With that kind of advance publicity Paul Dennett, the directly-elected executive mayor of Salford, would not appeal to most property people as their ideal partner.
Yet Dennett — the lead member for planning in Greater Manchester Mayor Andy Burnham’s cabinet — heads a city council that is directly involved in high-risk £200M commercial office development programme, and has been tolerant (to the point of earning fierce local criticism) over residential developers' concerns about affordable housing.
Now Dennett is preparing to make an inaugural visit to the Mipim property convention in Cannes in March where he will meet plenty of the “international and often faceless investors” (his words) which good municipal socialism normally prefers to avoid.
So how will Dennett square his Corbyn credentials with his pragmatic instincts? Perhaps more importantly, how will Dennett handle the deeply controversial re-write of Greater Manchester’s Spatial Framework, a document that caused outrage by proposing to take 11K acres out of green belt to help build 225,000 new homes and 24M SF of new commercial floorspace. He explained his strategy to Bisnow.
As with everything in politics, the key to success is to keep people guessing. Talk to locals and you hear Dennett described as either the deepest red socialist, or a shocking pink moderniser. On the strength of his avowed enthusiasm for Corbyn (and his special advisor Charlie Winstanley's role as an organiser for left-wing group Momentum) he's been called a bred-in-the-bone Corbynite.
A Corbynite Council?
At the same time angry critics accuse him of leading a campaign of outrageous gentrification of earthy Salford, the kind Corbyn has branded as "social cleansing."
Dennett's solution is to try to stretch the limits of local council intervention in the property market, and to say that government policy forces him into pragmatism.
“I supported Jeremy Corbyn in both his leadership elections because I’m deeply concerned by the U.K.’s direction of travel. We need to think about how we can intervene more — Jeremy has talked about municipal socialism, and I think we’re already doing that in Salford,” Dennett said.
Playing The Pragmatist
If municipal socialism means intervention in property markets as a buyer and developer, then Dennett is right. Salford council has long history of intervention.
In the 1990s the council bought a dockside site for £1M in a successful bid to pave the way for the MediaCity development which attracted a BBC relocation.
Today they are behind 352K SF of speculative office development at 100 Embankment (as developer) and at Two New Bailey (where they have a 25-year headlease).
“Yes it’s a risk, but these are calculated risks,” Dennett said.“This is about creating value for the city, it is intervening on behalf of people. Where we can show there is a benefit from city centre growth, we can take a more interventionist approach.”
By playing the property market, Dennett hopes to create construction jobs and improve the city’s appeal whilst simultaneously earning a strong continuing revenue stream from rents, or a big one-off payday from an investment sale.
“Our council revenue budget is dire — its been cut by 50% — so this property intervention is absolutely about generating rental income and business rate income. But it is also about social value and creating job opportunities as part of a 25-year payback that could be worth millions.”
A Pale Shade Of Red?
This strategy has not won Dennett friends in some more traditionally socialist parts of Salford. They deplore the sale of apartments to overseas investors and accuse the council of giving developers an easy ride on affordable housing obligations and protecting historic buildings. The Salford Quays development is often regarded as a case in point.
“The housing situation is really concerning,” Dennett said. “We have a chronic undersupply of low-cost social housing and affordable housing — the market is not delivering it, people are forced into renting and often hedge funds and their like are the beneficiers.”
Dennett insists he is “leveraging growth for genuine social benefit, not just benefitting a global and often faceless investment community.”
Yet his language on affordable housing is understanding and conciliatory.
“A lot of the affordable housing issue comes down to the viability assessments on private residential developments, which of course council officials pore over. I appreciate the concerns people have, but Salford still does better than Manchester at securing financial contributions from developers in lieu of affordable housing — we got £6.5M last year to Manchester’s £1.5M,” he said.
“We’re doing more: we’ve set up our own development company to acquire and develop low cost and social housing, and seeded it with £2M. But in the end the housing issues is down to viability and the real problems caused by government policy.”
The National Planning Policy Framework, which protects developer profits of up to 20%, is a particular problem, Dennett said.
On the preservation of local landmarks under threat due to the rapid pace of new development on the Salford/Manchester border, Dennett is also a pragmatist.
“Quite rightly people are proud of their history and identity and some of our fantastic buildings, and it’s a real struggle to protect them," he said. "I understand why this matters and where possible we should work with developers to protect them,” he said. That “where possible” is not the language of a revolutionary.
Green Belt And The Greater Manchester Spatial Framework
So what will Dennett propose for the revised Greater Manchester Spatial Strategy? A review — ordered by Andy Burnham immediately after his election last May — is due to be delivered in June, and Dennett is in charge.
“Since the review was agreed, we’ve heard from the government on their calculations of objectively assessed housing need which is about 10,700 homes a year up to 2035, a figure not very different from the one in the earlier draft of the spatial framework — so that is reassuring,” he said.
“We now have to see how we can mitigate concerns about green belt and green spaces, because it was very clear from the consultation that green spaces matter. I’m acutely aware, too, that it affects health — life expectation in the greener end of Salford is 10 years longer than in the more urban part, and that is unacceptable. We need to think about that.”
The alternative to building on green belt is to build more densely on urban space — causing the conflicts about affordable housing and loss of historic buildings which are creating growing anxiety across Greater Manchester, and already give Dennett pause for thought. So is he trapped between a rock and a hard place, damned if he opts to eat into green belt, and damned if he does not?
“Yes, it’s difficult. The current National Planning Policy Framework makes it very difficult, but we are meeting urban densities in parts of Salford, and Andy Burnham has been clear about urban densities too. We can also have infrastructure-led development, where we locate new development close to new infrastructure.”
“But it is true that it will be a real struggle to meet our 10,700 homes a year allocation without some encroachment onto the green belt although we will do our damnedest to avoid it.”
A Man With A Plan Of His Own
Dennett may be re-writing Burnham’s plan — but he also has a plan of his own. As well as pursuing the two city centre office schemes, he is investing political capital in two other substantial initiatives.
Peel Logistics’ £138M Port Salford will take container traffic, via the Manchester Ship Canal, from Liverpool’s new deep water container terminal deep into Greater Manchester. Late last year the latest phase of a 1.5M SF development were approved including units of 436K SF and 438K SF, with another unit of 382K SF to follow.
“We see Port Salford as a key economic hub, part of economic development plans yielding 40,000 jobs city-wide by 2040,” Dennett said.
Attention is also turning to The Crescent — long a Cinderella regeneration project — but now given new hope by a partnership with the University of Salford.
“We want this to be a cultural quarter, and we are masterplanning this now. It could absolutely be the place that those priced out of Manchester’s Northern Quarter come to, and we have to make sure placemaking there is not driven by a simple return-on-investment agenda, which we’ve seen too much of.”
That sounds like a criticism of the property industry, but Dennett is quick to deny it. “The council can’t do everything on its own — we can’t realise Salford’s growth potential on our own — so we need investors, but investors aligned to our values, investors here for the medium to long-term," he said. "And we need international investors because the U.K. government is not investing in Salford.”
So is Dennett the ultimate pragmatist, or is “pragmatist” a dirty word for a Labour politician in the days of Corbyn and Momentum? Dennett laughs long and hard before — gingerly — committing himself to an answer. “I don’t know…” he said. “My utopia is a Labour government that gets our problems, and takes places like Salford seriously. In the short-term that means we have to be pragmatic, but hopefully we’ll soon have a Labour government that can be more social and interventionist in its approach.”
A pragmatist could not have put it better.