Business premises will have to meet the expectations of the new generation of employees – Highwood Group interview
For the sixth interview in our Southern Powerhouse series, Nigel Meek, chief executive of The Highwood Group, gives his thoughts on how developers need to change their thinking and create property that meets the evolving needs of people today.
“Regulation is good if it’s put in place for the right reasons, because it is important to have clear guidelines as to what is and isn’t acceptable. I genuinely care about the environment I live in, and I want development to reflect that.” Nigel Meek is the chief executive at one of the fastest growing independent housebuilders in the country, with the strapline ‘enhancing lives and shaping communities’.
“But the issue is the bureaucracy involved in the planning and development process,” he says. “Building houses is the straightforward bit. The delays involved through the process of involving utility companies, the Highways Agency and other government quangos at one particular scheme cost us a seven-figure sum. Too often, there is a natural inclination to look for reasons for a scheme not to happen, rather than reasons to make it happen.
“Sadly, to add to the delays and frustration, it is a far from unusual scenario to have everything settled and then a staff change happens and you have to start all over again; it’s not a good way to make delivery straightforward.”
Bureaucracy for bureaucracy’s sake
Additional bureaucracy has come from regulations relating to so many areas affected by development, with these ranging from visual impact, ecology and energy efficiency through to hydrology and now issues with Nitrate. Of course, these are all very important, but all of them are adding to delay and rising costs. “With the subdivisions of planning increasing, so has the number of consultants we have to get involved, and when you factor in the often under-resourced planning departments at local authorities, it does slow everything down,” explains Meek. “It all comes at a cost, and my concern is that more bureaucracy is put in place to address the shortcomings of the existing bureaucracy.
“So from the developer’s perspective, the bigger the site, the better; it makes it financially worthwhile investing the resource and time to get a scheme consented where you can go above and beyond to really create a sense of place. Doing small-scale developments means going through all these hoops and the same amount of pain for less results.”
In saying ‘sense of place’, Meek is describing the desire of occupiers for a sense of community, a trend which manifests itself in a developer providing the necessary facilities and retail components.
Nobody is questioning the requirement for more housing, which Meek believe is certainly needed in the south, and he welcomes the government agenda requiring local authorities to allocate land for residential development. “There always used to be a reason why we couldn’t build from a council’s perspective. But we need housing, particularly for younger people, if employers in the region are going to be able to attract and retain a young and vibrant graduate workforce.
“To that end, the new agenda is good news for communities, particularly if such housing is predicated on also providing new and improved transport links. It is clearly becoming a greater target to try and incorporate improvements to infrastructure ahead of housing supply. This is, of course, difficult as cost of infrastructure is prohibitively high and this upfront early investment makes early site returns unviable. With that in mind, we are now looking for local authorities and Homes England to assist to ‘pump prime’ development and to recover such early investment through contributions made on house sales. This is a good, positive approach to get housebuilding going.”
But what is required is changing, Meek points out. Private rented stock is “a way forward,” he suggests, and there is a growing trend for flat-sharing as younger occupiers look to keep living costs down. “The design of properties will start to change in response,” he says. “For example, if builders design a place that has two bedrooms of equal size, each with an en-suite bathroom, and television points in both bedrooms, suddenly sharing becomes a viable option.”
Changing requirements driving response
What’s for sure, he says, is that the biggest demand for residential property (especially for younger people getting on the property ladder) is for one and two-bedroom new-build units that are completely fitted out. Older properties have become less desirable, partly due to the lack of DIY skills among younger people. “Millennials want quality of life and are time-poor,” says Meek. “The last thing they want to do is pick up a drill or a paint brush, so it begs the question: what will happen to the unwanted old housing stock as we develop new housing that’s in demand?
“It’s interesting to reflect on how developers are responding. We are also seeing a change in customers’ lifestyle requirements in their house design requirements; more open plan living and ‘inside/outside living’ is a real aspiration. To meet this change, we are very much looking to create modern solutions, such as wide, fold-back doors to our properties, as well as larger kitchen/dining rooms.”
Increasingly, new housing is taking the form of factory-created, ready-made, timber framed and modular buildings which are less labour intensive to erect. Meek would love to “push the boundaries” further with what’s possible. He points out that hotel rooms can arrive on site as ready-made pods, with tiling, electricity, plumbing, heating, and even the furniture already installed, and are just ‘clicked’ into position. That might alleviate the impact of the paucity of skilled trades. However, such ambitions are viewed with caution: “These solutions have all been tried before and sadly not worked for may reasons, but this should certainly not deter us from working with appropriate partners to find a deliverable solution going forward.”
Expectations need to be met
Energy efficiency will continue to be a core aspect of new builds – commercial as well as residential – including Highwood’s own offices. “As regulations around emissions and more environmentally friendly products become more and more prescriptive, older buildings are simply not as appropriate as purpose-built,” says Meek. “We are building new zero-energy offices, for example, with an ambition that we will generate as much power as we use. Perhaps a government grant scheme to enable redundant commercial and residential buildings to be brought up to that level would lead to a whole new wave of refurbishment.”
He believes it isn’t enough that a company’s premises are simply fit for purpose though: “They will have to meet the expectations of the new generation of employees in terms of quality as well as environmental impact,” he says.
Asked if he feels developers are holding back on bringing housing forward, Meek refutes any such suggestion that developers are holding back: “If we buy a piece of land, the sooner we can build to maximise the return on our capital deployed, the better. It would be nonsensical to just sit on it when there is demand for the end product.”