Place Value Wiki - C5. Economic development and regeneration

C5. Economic development and regeneration

The value of architecture

Aims and method:

Investigates the added value of architectural design. Draws together a wide range of research and empirical evidence and case studies.

Key findings:

· Flagship architectural projects have a clear economic impact on towns and cities. Tate Gallery at St Ives (UK), within 2 years of opening it contributed £16 million to the local economy. The Pompidou in Paris has more than 25,000 visitors per day.

· A pleasant environment, including good quality architecture, is central to people’s perception of what makes a town or city a good place in which to work and live.

· One study places the quality of the local environment as the top factor in the decisions made by middle managers about where to locate, ahead of transport, housing and schools

Reference:

Worpole, K. (2000). The Value of Architecture: Design, economy and the architectural imagination. RIBA Future Studies.

http://www.buildingfutures.org.uk/assets/downloads/pdffile_24.pdf

Good design in a downturn

Aims and method:

Explores the role of good design in the built environment in a challenging market. This has been done by analysing the costs of good design and investigating how high standards can still be achieved, despite the constraints facing developers. A survey of 52 estate agents (realtors) is included.

Key findings:

· Design is even more important during the recession, due to the increasingly selective requirements of both occupiers and property investors and the competitive advantage good design can provide.

· Recognising that there are elements of good design that are cost neutral will be an important part of maintaining high standards, particularly in an environment where there are significant cost constraints.

· Most property agents – 68% (78% in the residential sector) – believed good design was either important or very important.

· Appearance, space and layout were identified as aspects of good design that are particularly vital during a downturn.

· 74% of respondents said good design had a positive effect on rental and capital values; 75% (89% in the residential sector) thought the impact of design on occupancy and take-up rates was either important or very important.

Reference:

Places Matter (2009) “The Economic Value of Good Design” Places Matter

http://www.placesmatter.co.uk/wp-content/uploads/2013/05/Economic-Value-of-Good-Design-2009-Summary-Report.pdf

Masterplans, property markets and value

Aims and method:

Focuses on the role of promoters of development in masterplanning activity and on understanding why masterplans are being used in the UK. Three empirical sources were used: a survey of masterplan press reports (details of 89 separate masterplan cases from Planning magazine for the period 1997–2001); an examination of case study masterplans; and interviews with key national informants.

Key findings:

· There are economic benefits perceived by promoters of development in undertaking strategic area masterplans.

· These derive from the value of creating developments that exhibit a clear synergy with the surrounding areas and from designing a public realm areas that is perceived to be of a higher quality by potential users.

· Masterplanning itself signals a convergence between development interests and urban design principles that suggest that developers and investors believe that there is commercial value in achieving certain urban design objectives.

Reference:

Bell, D. (2005). The emergence of contemporary masterplans: property markets and the value of urban design. Journal of urban design, 10(1), 81-110.

http://www.tandfonline.com/doi/abs/10.1080/13574800500062387

The heritage dividend

Aims and method:

Examines the regeneration impact of area-based heritage funding through Conservation Area Partnership schemes (CAPS) and Heritage Economic Regeneration schemes (HERS) in England. Documents the impact of heritage investment across a number of indicators used to monitor regeneration funding programmes for 21 case studies from across England.

Key findings:

· £10,000 of English Heritage investment in the historic built environment leveraged on average £48,000 match funding from the private sector and public sources.

· Together, this delivers on average: 177 square meters of improved commercial floor space, 1 new job,1 safeguarded job, and 1 improved house.

Reference:

English Heritage (2002). Heritage dividend 2002-measuring the results of heritage regeneration 1999-2002.

https://www.thenbs.com/PublicationIndex/documents/details?Pub=EH&DocID=262329

Conservation area designation and property values

Aims and method:

This is the first rigorous study of the effects on property values of conservation area designation in England. It aims to investigate the costs and benefits that are associated with a location of a property in a conservation area of which over 9800 have been designate in England since the 1960s. The research, involved: Statistical analysis of over 1 million property transactions between 1995 and 2010, and data on the characteristics of over 8,000 conservation areas; a survey of residents in 10 conservation areas to measure people’s perceptions of conservation areas and how these relate to house prices; and interviews with local planning officers.

Key findings:

· Houses in conservation areas sell for a premium of 9% on average, after controlling for other factors.

· Property prices inside conservation areas have grown at a rate that exceeded comparable properties elsewhere by 0.2% a year.

· Overall there was not a negative attitude toward planning regulations.

· Especially in areas with higher house prices and low deprivation, strong planning control was often linked back to protecting the coherence of a neighbourhood.

Reference:

Ahlfeldt, G., Holman, N.,& Wendland, N., (2012) An assessment of the effects of conservation areas on value, Final Report

https://historicengland.org.uk/research/current/social-and-economic-research/value-and-impact-of-heritage/value-conservation-areas/

The use of historic buildings in regeneration

Aims and method:

Gathers evidence to demonstrate that ‘heritage works’ and is a valuable asset that has an important role to play as a catalyst for some of the most successful regeneration projects in England. Evidence from a set of case studies is gathered and used to make the case.

Key findings:

· On average £1 of investment in the historic environment generates an additional £1.60 in the local economy over a ten-year period

· Half of all jobs created by heritage tourism are in the wider economy that supports and supplies heritage attractions.

· In the case of Oxford Castle regeneration, for example, the project has been achieved in a successful on-going partnership between the private, public and non-profit sectors, and has created nearly 350 new jobs, 11 businesses and an annual turnover of £8.5 million.

Reference:

Brennan, T. & Tomback, D., (2013) The use of historic buildings in regeneration. London, Historic England

https://historicengland.org.uk/images-books/publications/heritage-works/

Active cities and competitiveness

Aims and method:

The Active Cities Report includes a summary of the evidence from various case studies that points to an active city also being a competitive one.

Key findings:

· In Hernando, Mississippi (USA) a series of low cost interventions (prioritising physical activities, activating resources, designing for people and creating a legacy of physical activities, like marathon events), resulted in the city’s health insurance premiums reducing by 15%, saving taxpayers approximately $130,000.

· Similar interventions in Buenos Aires (Argentina) resulted in a cut of noise and gasoline emissions by half.

· In Melbourne (Australia), such interventions resulted in the health benefit from physical activity returns at a cost-benefit ratio of 1.83112

Reference:

Designed to Move (2015) Active Cities Report, A Physical Activity Action Agenda.

http://www.designedtomove.org

Design and occupier productivity

Aims and method:

Examines the problem of managing buildings as an investment and discusses how a well-designed and constructed asset can deliver greater capital returns for the client in the form of business benefits. Explores market-based approaches to property valuations and how they frequently neglect to take account of the costs and benefits that can accrue through design targeted towards increasing the quality of a building so it better meets the needs of the clients

Key findings:

· Well designed buildings have given perceived productivity up to 12.5%.

· Conversely the worst buildings surveyed led to falls in productivity of up to 12.5%

Reference:

Spencer, N. C., & Winch, G. (2002). How buildings add value for clients. London, Thomas Telford.

http://www.thomastelford.com/books/bookshop_main.asp?ISBN=0727731289

The value of urban design

Aims and method:

Identifies and where possible measures the value added by good urban design in three regional office markets in England. Pairs of case studies (good and poor urban design) in the same markets were subject to urban design analysis; detailed interviews with key stakeholders; and eliciting information on development costs and expected and actual returns on investments, where available.

Key findings:

· Good urban design adds value by increasing the economic viability of development and by delivering social and environmental benefits through: producing high returns on investments (good rental returns and enhanced capital values); placing developments above local competition at little cost; responding to occupier demand; helping to deliver more lettable area (higher densities); reducing management, maintenance, energy and security costs; contributing to more contented and productive workforces; supporting the ‘life giving’ mixed-use elements in developments; creating an urban regeneration and place marketing dividend; differentiating places and raising their prestige; opening up investment opportunities, raising confidence in development opportunities and attracting grant monies; reducing the cost to the public purse of rectifying urban design mistakes.

· Good urban design adds social and environmental value by; creating well connected, inclusive and accessible new places; delivering mixed-use environments with a broad range of facilities and amenities available to all; delivering development sensitive to its context; enhancing the sense of safety and security within and beyond developments; returning inaccessible or run down areas and amenities to beneficial public use; boosting civic pride and enhancing civic image; creating more energy efficient and less polluting development; revitalising urban heritage.

Reference:

Carmona, M., de Magalhaes, C., & Edwards, M. (2001). The value of urban design: a research project commissioned by CABE and DETR to examine the value added by good urban design. London, Thomas Telford.

http://www.designcouncil.org.uk/sites/default/files/asset/document/the-value-of-urban-design_0.pdf

The value of better urban design

Aims and method:

Examines the case for investing in better urban design in New Zealand. An extensive body of international literature was examined exploring links between urban design and economic, social/cultural and environmental outcomes.

Key findings:

· Local Character: Attracts highly skilled workers and new economy enterprises; Assists the promotion and ‘branding’ of cities and regions; Contributes a competitive edge by providing a ‘point of difference’; Potentially adds a premium to the value of housing; Reinforces a sense of identity among the residents of a neighbourhood; Encourages people to become actively involved in managing their neighbourhood; Offers choice among a wide range of distinct places and experiences; Supports conservation of non-renewable resources.

· Connectivity: Increases viability of local service shops and facilities; Increases a site or area’s accessibility, thereby enhancing land value; Enhances natural surveillance and security; Encourages walking and cycling, mainly for non-work trips, leading to health benefits; Shortens walking distances, encouraging people to walk; Vehicle emissions are reduced through fewer non-work trips

· Density: Provides land savings; Provides infrastructure and energy savings; Reduces the economic cost of time allocated to mobility; Is associated with concentration of knowledge and innovative activity in urban cores; Is difficult to disentangle from the benefits of mixed use and other factors; Can contribute to social cohesion; Tends to promote health through encouraging greater physical activity; Enhances vitality; Reinforces green space preservation if linked into clustered form; Reduces run-off from vehicles to water; Reduces emissions to air and atmosphere; May conflict with micro/local green space needs

· Mixed Use: Enhances value for those preferring a mixed-use neighbourhood; Utilises parking and transport infrastructure more efficiently; Increases viability of local service shops and facilities; Significantly lowers household expenditure on transportation; Improves access to essential facilities and activities; Provides convenience; Encourages walking and cycling, leading to health benefits; Reduces need to own a car; Increases personal safety; Can enhance social equity; Reduces car use for local trips (but minor impact on commuting) and hence emissions

· Adaptability: Contributes to economic success over time; Extends useful economic life by delaying the loss of vitality and functionality; Increases diversity and duration of use for public space; Gives ability to resist functional obsolescence; Supports conservation of non-renewable resources

· High Quality: Public Realm Attracts people and activity, leading to enhanced economic performance; Public art contributes to enhanced economic activity; Higher participation in community and cultural activities; Increased use of public space; Gives greater sense of personal safety; Attracts social engagement, pride and commitment to further achievements; Public art contributes to greater community engagement with public space

Reference:

McIndoe, G., Chapman, R., McDonald, C., Holden, G., Howden-Chapman, P., & Sharpin, A. (2005). The Value of Urban Design: the economic, environmental and social benefits of urban design. Wellington: Ministry for the Environment, Wellington City Council, Auckland Regional Council.

http://www.mfe.govt.nz/publications/towns-and-cities/value-urban-design-economic-environmental-and-social-benefits-urban

Spreading regeneration benefits further

Aims and method:

Examines the spatial benefits offered by urban regeneration efforts in Catania, Italy. The masterplan introduced new green spaces (to encourage use and reduce heat), a compact, mixed-use urban form, and new pedestrian and bike lanes. Quantitative evaluation followed using GIS data of four issues in seven regeneration areas across the city.

Key Findings:

· The investments reduced the seismic risk exposure, and increased the compactness and mixed use which changed the population density both within and around the regenerated area

· Net positive benefits were experienced in surrounding areas by connecting regenerated areas to the existing urban fabric through improved permeability.

Reference:

La Rosa, D., Privitera, R., Barbarossa, L., & La Greca, P. (2017). Assessing spatial benefits of urban regeneration programs in a highly vulnerable urban context: A case study in Catania, Italy. Landscape and Urban Planning, 157, 180-192.

http://www.sciencedirect.com/science/article/pii/S0169204616300986

New development in distressed neighbourhoods

Aims and method:

Estimates the effect of design on the assessed values of new housing units in high-poverty Chicago census tracts, and explores the influences of individual urban design features. Uses a parcel-based hedonic regression in which three urban design types are distinguished: enclave housing, traditional neighbourhood development (TND), and infill.

Key Findings:

· Urban design significantly affects housing values, and infill housing is more highly valued than either enclave or TND housing.

· Specifically, location in an enclave decreases housing value by between 22% (large sample) and 24% (small sample), and location in a TND development decreases value by between 21% (small sample) and 27% (large sample) compared to the same unit built as infill.

· Residents prefer entrances that face the street, and facades constructed from the same material as adjacent buildings.

· They also prefer parking in front of their homes, and to be buffered from public streets.

· There is a preference for greater integration into the surrounding neighbourhood, rather than for housing which is dissociated from it

Reference:

Ryan, B. & Weber, R. (2007). Valuing New Development in Distressed Urban Neighborhoods. Journal of the American Planning Association, 73(1), 100-111.

http://www.sciencedirect.com/science/article/pii/S0169204616300986

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