Back in February, Dublin City Council put out a call to the private sector to ask if there was any interest in developing housing on three swathes of vacant council land.
These land banks have the potential for around 1,440 residential units. That’s a useful chunk, given that last year, the Housing Agency predicted that the Dublin Region would need 37,581 additional housing units between 2014 and 2018.
Now the council is trying to work out how best to use the land, and what kind of relationship it should shoot for with the private sector in developing it.
Who Will Take the Risk?
In response to the February call, city council has received around sixty-five responses from all kinds of folks: estate agents, developers, approved housing bodies, and architects to name a few. Council officials met with two-thirds of the respondents for one-on-one discussions about what they would consider to be workable models. Officials compiled all that into a report they sent to councillors.
Today, 22 July, councillors are set to debate the contents of that report. It’s likely to be intense.
The general flavour is that the market is risk-adverse and conservative at the moment, Dublin City Council housing chief Dick Brady told a council housing committee earlier this month. “They want all the risk to sit with the state and we don’t think that’s right,” Brady told councillors. “We think that there are other ways of moving.”
That aversion to risk might be why they were only interested in two of the sites put forward: at Belcamp and on Oscar Traynor Road. The land suggested by the council in Cherry Orchard “would be the least likely to appeal to the market at this time,” according to the report. It cited “social sustainability” as an issue, but didn’t go into detail about what that meant.
“They’re very conservative in the way they’re approaching the market,” said Fianna Fail Councillor Paul McAuliffe of the construction sector.
McAuliffe said that at an all-party meeting with representatives of the construction sector, they were very focused on building three-bedroom semi-detached houses in areas where they could recoup the price. “To me that shows the lack of capacity and the lack of innovation in the sector,” he said.
Don’t Say the PPP Word
When the idea for Dublin City Council to work with the private sector to develop housing on vacant council land was raised about a year ago, councillors were wary. The spectre of past public-private partnerships has, understandably, haunted the debate.
They remained wary on Tuesday, ahead of today’s debate on the report, which laid out several options for ways that the public sector (the council) could work with private parties to build sorely needed housing in Dublin. Though perhaps some will be hesitant to call any such cooperation a public-private partnership.
Assuming that the council is going to work with the private sector on this issue, a key question today, several councillors said, is how to find a sweet spot for the mix of housing that the partners build.
“I would like to see as much stock revert to the council as possible from these developments. But I’m still very conscious of the social mix and the critical tipping point between having too many social houses and not enough private,” said Labour Councillor Alison Gilliland.
Sinn Fein know what they want from the land, said Sinn Fein Councillor Daithi Doolan, who is head of the council’s housing committee. He’d like to see a mix of social housing, affordable housing, cost-rental, and private sector units.
For those who aren’t au fait with the council’s housing jargon, affordable housing is sold at an affordable rate, and cost-rental housing is rented long-term at the cost of building and maintaining it.
Like Doolan, Fianna Fail’s Paul McAuliffe also stressed the need for mixed tenure, while delivering as many social units as possible. For people who aren’t eligible for social housing, but can’t afford to buy, McAuliffe is interested in the idea of cost-rental.
“Can we provide both social and affordable housing?” he asked. “And affordable housing doesn’t have to mean purchasing. Is there a long-term rental model for people on moderate incomes, but who wouldn’t normally qualify for social housing?” he said.
What Would Be the Quid Pro Quo?
If the council does go ahead and work with the private sector to build some mix of social, affordable, cost-rental and private sector housing, what will be the quid pro quo? What will its private partners get out of the deal?
At the moment, different models are being kicked around. But the report’s recommendations, which housing chief Dick Brady said offer the construction industry’s view, hone in on one option.
This option would be for the council lands to dispose of (transfer) the land to the private sector, and then buy back housing units on that land under what is know as the “Part V” mechanism for social and affordable housing. It might involve disposing of some of the land at a significant discount via a 20- to 25-year lease.
Some councillors are wary of such an arrangement.
“My fear is that the developers build it and the council gets the Part V. Even if you increase the Part V, we’re still not getting a huge amount of units for our social housing,” Gilliland said.
People Before Profit Councillor Brid Smith says, in general, she’s against the whole approach, and would rather see the council and state building homes directly. She’s waiting to see what comes out of tomorrow’s meeting though, before commenting in detail on the lands initiative.
Fianna Fail’s McAuliffe is keeping an open mind. “I’m not hung up on ideology,” he said. “What I want to see is a model that delivers what we want to achieve.”