Stakeholder impacts: a critical view
The IQL is an example of property-led, regeneration project, in which the private sector takes a leading role in delivering government regeneration policy.
Remember that a regeneration project:
improves the environment of a previously unused area attracts private investment and business confidence for further investment.
This kind of development has been popular in the UK since the 1980s, and has been used to achieve a range of regeneration goals, including:
• modernising infrastructure
• creating new ‘flagship’ mixed-use schemes (property developments designed for multiple purposes. These sites may for example, include non-commercial buildings such as a community centre) and
• making improvements to residential areas.
Albert Dock, Liverpool, England is an example of a regeneration project which includes accommodation, restaurants and several museums ©Own work, Jonathan Oldenbuck, C.C3.0 via wikimedia commons
However, some academics, journalists and community activists have been critical of property-led regeneration. There are a number of reasons for these criticisms but many relate to:
• the nature of public-private partnerships,
• questions of local democracy and
• gentrification (the process that leads to an influx of more affluent people into a deteriorating area, often resulting in the displacement of poorer residents).
Let’s examine these criticisms in further detail.
The nature of public-private partnerships
Property-led regeneration normally involves some kind of partnership between the public and private sectors, working to meet the objectives of central or local government. A Public-Private Partnership (PPP) is seen by many as a good way of building ‘synergy’; combining the skills, knowledge and resources of private real estate companies with those of public sector organisations.
The regeneration process relies on a successful collaboration of partners providing the following:
• political (eg local government) and/or community support
• expertise, information and contacts.
As you saw in the previous Step however, partnerships can be fragile and difficult to operate because each partner has their own objectives, values and priorities, some of which may conflict with those of others. Conflicts need to be resolved or managed or they may undermine the work of the PPP, especially if lines of decision-making and implementation are not clear.
Questions of local democracy
Some have argued that partnership is a way of avoiding conflict by side-stepping the inherent disagreements that exist in regeneration, and creating a ‘false consensus’ by excluding certain interests that are antagonistic or have ‘unacceptable’ demands. Many PPPs have been criticised for their lack of local democracy’; the range of local views represented is capped and direct community input is restricted.
Politics is a key component of regeneration but elected politicians may be perceived as working in the interests of the private sector, including developers, rather than the people they represent. Another criticism relates to the role of central government agencies like urban development corporations which can take a leading role but may act to further distance local communities from the regeneration practice.
Process of gentrification
Another major issue which has attracted criticism concerns the outcomes of the property-led regeneration process. Value-creation, for example in local property markets, is often a goal of property-led regeneration, but some effects such as increased house prices, might have negative impact, especially for existing communities.
‘Gentrification’ (itself a contested term) is often used to describe the way that local real estate market – changes brought-about by new property development or renovation, can have a number of negative impacts on local communities who were meant to be the beneficiaries of regeneration policy. For example:
• initial site clearance can displace small businesses who employ local people.
• The proposed development may not include the kind of buildings needed by existing residents, possibly drawing-in office workers from further afield to create a new social mix, with expensive houses and apartments or high-end leisure and retail spaces.
• Once a scheme comes to an end, or even before its completed, property prices and rents may increase in the local area and ‘squeeze out’ lower income families who cannot afford to pay.
A diagram to show two different approaches to property development ©University of Reading.
The problems associated with property-led regeneration have led some to believe that more ‘organic’ and ‘bottom-up’ approaches to regeneration are needed. Organisations like the New Economics Foundation provide an alternative view and a different model of urban regeneration. The arguments about regeneration and the role of property within this process are complex and multiple, and these debates are likely to remain on the political and economic agenda for some time to come.
If you’re interested in finding out more about bottom-up approaches, you may like to look at this case study on Coin Street Community Builders. Are you aware of any similar schemes in your area? Have they been well received by existing residents and local businesses? Share your examples in the comment area below.
The Guardian website has a useful report on a ‘roundtable discussion’ on regeneration that covers these critical points.
© HBS and RREF