Catching up from MIPIM 2019

Courtesy of Inside Housing

Over the past four days the world of property has descended on the picturesque French city of Cannes for the 30th MIPIM property festival.

The annual property jamboree on the French Riviera is a place where deals get done, relationships get built and the odd glass (or hundred) of sparkling wine gets drunk.

A total of 5,900 delegates made the journey this year to the Palais des Festivals, Cannes’ renowned conference centre, including a healthy showing from the UK social housing sector.

And as the Brexit saga took another turn back in blighty, the serene south of France setting provided council bosses and housing association development directors with a bit of respite from the chaos and confusion raging around the country’s exit from the European Union.

Also on the delegate list was Inside Housing, which has spent the past four days taking in all of what festival has has to offer.

So as the sun sets on MIPIM 2019, here are our biggest takeaways:

Brexit is hitting the housing association sector – but not everywhere

For many who made the trip down to France from the UK, it may be their last trip as a European citizen.

As the Brexit question dominates most political and business conversations in the UK currently, the ‘B’ word was, surprisingly, less of an issue on a number of the panels Inside Housing saw this week.

Whether because of the sea air or the sparkling wine, or just because it is impossible to talk about the complete unknown, many panels were Brexit-free zones.

However, step away from the stages and you find that in many of the conversations off the stages, the ‘B’ word was front and centre.

With recent high-profile tales of housing associations running into difficulties in securing private sales, there is definitely a nervousness throughout the sector’s development leaders – particularly in London and the South East.

“The ‘B’ word was, surprisingly, less of an issue on a number of the panels”

Senior housing association figures who Inside Housing spoke to over the week said that they had, and that they had seen, some development plans paused until there was more clarity over the Brexit situation.

And the uncertainty is filtering down the supply chain.

One social housing contractor told Inside Housing that while March is usually quite a busy month, with associations trying to get deals over the line before the end of the tax year, this month had so far seen a major drop-off when compared with previous years.

Others were less nervous, and had not yet seen sales drop off. One association had recently completed a block in east London and said that it was able to fully occupy the development relatively quickly.

But the UK housing market isn’t just the London housing market, as one delegate was keen to point out to me over dinner.

The development director of an association operating outside London said that in places such as the Midlands, the sales market was strong and associations were having no trouble selling private sale or shared ownership homes.

The French housing minister briefs the press

Ou est le housing minister?

Brexit did prevent one thing this week, though, and that was the appearance of a UK government minister at MIPIM this year.

Housing minister Kit Malthouse was initially down to be the government’s representative but a pretty important vote on Wednesday put paid to that.

However, Inside Housing did get close to one housing minister at least. Julien Denormandie, France’s minister for city and housing, carried out an interview just metres away from where I was frantically typing away.

While my French GCSE was unable to allow me to translate, a scour of the French press revealed that he had unveiled changes to regulation on the way house builders could build developments in a bid to speed them up.

It seems the desire to build more, better, faster is something that housing ministers have in common on both sides of the Channel – despite our differences over that other thing.

The city region’s sphere of influence is growing

It wasn’t the best start to MIPIM for the UK’s city regions.

After Manchester City Region’s stand was flooded by a freak wave last year, this year it was the team’s flight to Cannes that had its problems.

Manchester’s chartered plane to Nice airport had to be redirected to Genoa in Italy after high winds made a landing at the airport impossible. After a quick stop off, they were back in the air, and landed later that day.

Their North West neighbours from Liverpool were not so lucky, with high winds causing their flight to touch down in Marseille. The delegation was then required to make the 174km trip by road or rail to Cannes.

However, once in Cannes the UK’s city regions showed just how much of a growing influence they were having on the country’s housing plans.

On Tuesday, West Midlands mayor Andy Street revealed a £10bn pipeline of investment opportunities across the region, with housing-led schemes dominating its list.

Across the rest of the week we heard from the country’s other city region leaders from Newcastle, Bristol, Leeds and Liverpool on their future plans, with housing very much at the forefront of these ideas.

At the Inside Housing lunch on Thursday, Andy Burnham, mayor of Greater Manchester, was keen to praise the local authorities in the region and the innovative strategies they were using.

Homes England’s Mr Walkley summed it up on the last day when he said that the devolution movement and collaboration of local authorities was giving regions more power than they have ever had to make a difference.

With the energy, enthusiasm and increasing influence on show from the regions at this year’s MIPIM, it is hard to argue against that.

The offsite revolution isn’t quite nigh

There is still a lot of work to do to ensure that modern methods of construction (MMC) become more widely used.

And this is particularly true in the social housing sector, where a lot of talk has yet to be replaced by widespread action.

I heard from a number of people working in or with offsite manufacturers who outlined the difficulties and frustrations of working in the social housing sector.

One delegate explained to me that, currently, most housing associations are open to running offsite pilot schemes but aren’t willing to go further than that.

“Offsite needs a large pipeline – the housing association sector isn’t providing that yet,” the delegate said.

“There is still a lot of work to do to ensure that modern methods of construction become more widely used”

And as a result of this lack of consistent work, the nascent offsite supply chain is having its own issues. Many are under-capitalised and are finding it hard to secure the order books to make them fully viable.

Inside Housing spoke to one delegate close to the government, who said that this under-capitalisation of offsite companies was a real issue and something the government was trying to address through additional support.

While a handful of associations have committed to offsite in the form of factories and commitments, they are in the minority, and it still might be some time before the sector fully embraces MMC.

Homes England: the Tinder of housing delivery

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“The Tinder of housing delivery” is how Nick Walkley described Homes England when explaining how it matched money with those with land and ambition to build, perhaps revealing the level of attention he has been paying attention to Inside Housing's recent feature designs.

Whatever you want to describe the delivery body as, MIPIM illustrated what a significant role Homes England is now playing in the construction of houses throughout the country.

Now 14 months into its creation, the presence of the delivery body was at times inescapable. The agency was represented more than 100 times on panel sessions across the three days.

The interest in the agency and its plans from local authorities, developers, house builders and contractors was reflected in the agency’s drinks reception on Wednesday, one of the best attended all week. “It makes sense though, doesn’t it? They’ve got £27bn to spend,” one delegate said.

“MIPIM illustrated what a significant role Homes England is now playing in the construction of houses throughout the country”

While the strategic partnership programme has been warmly received in the housing association sector, MIPIM illustrated the number of other ways the agency was trying to boost housing delivery.

In one of his speeches, Ed Lister said that the government now understood that they needed to do something differently to ensure that enough homes were built, and was taking on a much more hands-on role.

And Homes England’s importance was further underlined when the DIT unveiled its housing investment opportunities across the UK. The 11 projects, which have an estimated £6.2bn value, could unlock more than 40,000 homes across the country, with Homes England at the centre of planning all of the schemes.

Local authorities are gearing up for the big build

If there was one thing that came across at this year’s MIPIM, it was that local authorities have the appetite to build homes.

With representation from all corners of the country, Inside Housing was inundated with council figures offering visits to the area to see proposed new development sites, or conversations about how they are approaching housing development differently.

Some are already well advanced with plans on how to spend their Housing Revenue Account borrowing, while others are developing housebuilding capacity through housebuilding companies or long-term partnerships with developers and contractors.

And it is clear they’re skilling up, too.

Inside Housing spoke to some working in local authorities who had recently moved across from the private sector, and others who had been recently poached from another council with the aim of increasing their development pipeline.

And this shift by local authorities is reflected in the jostling by developers, house builders and housing associations to partner with them.

One builder told me that it saw partnering with local authorities as its biggest area of business growth in the coming years, and was already looking at potential suitors for long-term arrangements.