The right spaces in the right places

The government's reform agenda is leaving no part of the public sector untouched. With phase three
of the One Public Estate (OPE) initiative now in full flow, it is apparent that focus remains on the large local government property estate, with councils being urged to look afresh at their land and property assets.

Once referred to as a 'bloated property portfolio', the value
of the entire public estate is estimated at around £350bn,
with councils owning assets worth around £150bn and
annual running costs estimated at more than £5bn.

Launched in 2013, the OPE initiative operates alongside other programmes to rationalise property held by central government, such as the
Amenity Assets programme.

The OPE initiative aims to generate capital receipts; reduce public sector spending by reducing operating costs; deliver services which are more joined up and have the service user at the centre; and act as a catalyst for economic growth.

Projections for the first phases suggest potential property sales worth £129m, as well as £77m savings in running costs and the creation of 20,000 jobs and 9,000 homes over a five-year period.
It seems likely further phases will be announced throughout the term of this parliament.

Innovative projects

Though initiatives involving
the sale of public assets are not universally popular, numerous councils have drawn up plans for innovative projects where assets are used to drive change and economic growth.

The more successful transformation projects will prioritise partnership working and effective engagement between public sector organisations, underpinned by a shared vision, strong leadership, and broad-based buy-in.

Successful projects
currently emerging include:

• An innovative joint property vehicle in Worcestershire, thought to be the first collaboration of its kind, called Place Partnership. It involves a single asset management company, formed by core partners, including several councils and blue-light services. Entrusted with around 1,400 assets,
  ranging from fire stations
  to libraries, police stations,
  and community centres,
  the new enterprise will focus
  on better use of the extensive property portfolio, facilities management, innovation
  in service delivery, and economic growth;

• A purpose-built £20m public services hub as part of the regeneration of Ellesmere Port's town centre. It is hoped many benefits will result from bringing diverse public sector organisations together under one roof, providing a customer access point for health, housing, and council services; and

• Sheffield City Council has
  seen the release of sites for regeneration following relocation of services and the creation of a new community hub where a range of public services are co-located. This has led to significant capital receipts, reductions in running costs, and the freeing-up of sites for alternative use.

The potential for wide-ranging positive outcomes will continue to attract innovative councils open to exploring shared use
and co-location of services.

Boost housing supply

A particularly important outcome would be more new homes entering the supply chain.
The release of land for housing has to be given priority within the OPE initiative. Estimates suggest the state holds enough land to build up to two million new homes, so plenty of scope exists for building much-needed affordable housing through the disposal of surplus land.

There needs to be close collaboration between OPE councils and the new housing implementation taskforce to encourage councils to release surplus land, especially brownfield sites, for housing development, and proper tracking from sale to construction to demonstrate value to taxpayers.

The Housing Bill, expected to materialise in October, is likely to oblige councils to maintain a register of brownfield land capable of redevelopment for housing. The London Land Commission's remit is to help identify surplus brownfield land currently in public sector hands, encourage its release, and boost housing supply.

The government will increasingly look to pioneering councils to play their part by rethinking service delivery, focusing in particular on the important role that managing, rationalising, and consolidating their property estates can play. Get it right, and the positive outcomes will make a real difference to councils and their local communities, as well as service users and the public purse. SJ

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