Building Together for the Future: Priorities for the next decade

A series of insights from friends of the firm and long-standing leaders across the Built Environment

In our penultimate discussion series with a group of industry leaders across the Built Environment we are considering some of the more pressing priorities for the sector over the next decade.

It is evident that over the next decade the UK needs to build more housing, and we cannot be in a place where we don’t have safety as a priority, particularly in terms of fire safety, structural integrity and winning the battle with  damp and mould. But to keep the industry moving forward whilst creating a sustainable built environment suitable for our expanding, but ageing population, there are many further priorities to consider and commit to.

We are hugely grateful to our contributors for their time and valuable insights, including:

• Hugh Seaborn, Chief Executive, Cadogan Estates
• Phil Andrew, Chief Executive, Orbit Housing Group
• Professor Yolande Barnes, Chair, Bartlett Real Estate Institute, UCL
• Richard Donnell, Executive Director, Houseful
• Paul Fiddaman, Chief Executive, Karbon Homes Group
• Emily Cox MBE, Chair, Gentoo Group
• Andy Hulme, Group Chief Executive, The Hyde Group
• Muyiwa Oki, RIBA President and Architect

Spotlight on sustainability

Sustainability and achieving net zero are undeniably at the top of the agenda, with broad consensus on their importance. However, they encompass many different facets. Building better insulated, more efficient housing of mixed tenures is essential, but that is only part of the solution. Consumer education is going to be crucial, and this is the responsibility not just of the built environment industry but also where Government can help to help create the momentum to reduce emissions and working collectively across communities. It will be important to deliver investment and transparency on rent increases that will be essential to support investment in building more sustainable housing.

“We need to think about how we can make consumers more aware, empower them to understand the impact and how they can make a difference.”

While the Government has pushed the EPC agenda, that target is “only really scratching the surface”, according to one commentator. The embedding of much greater targets and essentially investment is going to be crucial. And this cannot be relied upon with carbon offsetting or carbon credits as the model. Nor are renewables the panacea, given this is an industry using lot of extractive resources, and with huge levels of demand being placed on it.”

The carbon credit market is international and according to one commentator is not well enough developed and this must be considered a priority now. And with targets for Net Zero extending well into 2050, the investment required in this area is only going to go up.  “Currently it’s a cheap way to do things but it doesn’t have longevity.”

The investment in decarbonisation is going to be huge. There is no other way round it, but Government believes it will also bring opportunities, (beyond the more obvious ones for our planet) with the creation of many more jobs, training opportunities and innovation-based developments in technology, manufacturing and construction.

Innovation in thinking and approach

It goes beyond just bricks and mortar; there is a clear need for innovation in evolving cultural attitudes, financing, and service models

The question of value will be vital, said one of our commentators: “We can’t carry on financialising everything.” The importance of environmental and social impacts and how we value those must gain greater visibility to sustain the health of our planet and our populations.  With climate change we are already seeing shifts in areas becoming so exposed to extreme weather that there will ultimately be places that will become unliveable. While that is not in the next decade, the need to evolve our thinking on value has to start sooner. “It ultimately will make the difference between value and no value if we don’t do more.”

That does not mean abandoning our historical economic approach altogether, however. Using the efficiency and motivations of capitalism to get things to happen can bring huge benefits, but we do have to start innovating in how we look at the economic model. “Whether it is the donut economy, the circular economy or a balance between extractive and regenerative capitalism, we have to evolve our economic rationales across the built environment.”

A greater adoption of technology is also considered paramount by some we spoke to, and an area that has not always been top of mind in all parts of the sector. The place for AI was discussed and highlighted as crucial to certain areas of design and development, particularly in regard to architecture and engineering. It was also considered potentially important in thinking about how it can benefit operational functions within certain organisations – a point we will come to later.

It was suggested that in a cost-conscious sector operating with tight margins, fees and service charges require closer scrutiny. A more holistic view about charging and the benefits of more collaboration could be key: “it can’t simply be about making the best margin, we have to think about the best outcomes overall.” This can be done with greater consideration of public and private investment and working in partnership more frequently to deliver the best results.

Skills for the future

One of the more obvious challenges when it comes to building, upgrading or maintaining the built environment is having an available supply of people with the right skills to do so. One of our commentators put it plainly: “If we’re going to build our way out of this I am not sure we have enough of an appropriately skilled workforce to do that”.  There needs to be a greater emphasis on training in specific skills, such as bricklayers, electricians and plumbers With an ageing population and workforce, this challenge becomes even more difficult, making it essential to consider training and reskilling in this context.

However, there are many opportunities, with Gen Z i already showing an appetite and commitment to doing things differently. For the still quite traditional built environment industry that might feel hard, but across all areas of the built environment a greater spotlight on sustainability will require those with skills and training to develop experience in green and environmental solution-identification.. Our commentators unanimously agreed that, in addition to investment in traditional physical labour, there is a growing need for a focus on developing green skills.

It remains likely that the built environment sector is one where human skill will continue to dominate, but the benefits of technology advancement in areas such as generative AI could allow for better use of data to track not only investments, but also customer service requirements and enhance human efficiencies across many areas. Our commentators agreed that it is important to be looking to other sectors and organisations to understand where they are seeing gains through technology. It was well summarised by one: “We are big employers and we remain one of the most human dominated industries, but where we can take advantage of technology and create more efficient systems we must.” That will require something of a cultural shift, but also investment (of course) and a firm ambition from leadership to deliver it.

Building for sure, but also making more of what we have

Housing will remain a priority well into the next decade. That means building more, but it also means deeper consideration of rents, tenures and importantly how we retrofit and upgrade. There are too many stranded assets in the UK which require proper consideration of what is needed to bring these back into a useful and mixed use, sustainably and sensibly. It can’t all be housing, even though that is where a pressure point exists, but that isn’t what creates communities and thriving regions.

“Without more strategic planning and joined up thinking we’re going to go nowhere,” said one commentator. It was noted that in areas like the North East there has been a seemingly greater appetite for being creative in how they can work together across the region to identify investment and deliver on ambitions. That joined up thinking appears less obvious in the South East and could present some serious challenges in the future.

The strategic importance of London cannot be ignored. One commentator said: “You can’t do levelling up across the country by levelling down London. We need to invest to encourage London.” It is one of only a handful of genuinely global cities in the world and the impact is felt right across the UK. With rents and house pricing extraordinarily high in the city and surrounding areas there needs to be some clear readjustments in the market view. This does however require more joined up thinking and a viable planning system which works through collaboration and consideration and doesn’t remain “the industry whipping boy.”

As well as the investment required to upskill and innovate from within the built environment sector, it is clear that a change in mindset needs to extend to wider society. One commentator said: “I hope we lose some of the stigma around housing associations.” With a national crisis on the affordability of homes, loss of stock through right to buy and not being able to build fast enough, social housing and housing association homes will be crucial in the next decade. This means a wider range of tenures and building and upgrading stock appropriately and safely, so that it is here in the next 100 years, not just decades.

Adviser view

The next ten years is a short timeframe in the history of this sector, but with the competing pressures to create more homes, alongside dramatically increasing decarbonisation, it will be a crucial period in time.

As trusted advisers in this space we are very aware of the pressure this brings for leaders. However, those we talked to show genuine willingness to plan and build for the future. They recognise the responsibility they have for society and the environment and want to find solutions that can bring about change and positive impact that will last well beyond them.

Committed to Leadership Excellence in the Built Environment

Our Built Environment practice group is committed to finding and supporting excellent and authentic leaders across infrastructure, local and regional development, housing and transport to deliver tangibly positive benefits for existing, emerging and new communities across the UK.  To find out more about how we can support your organisation’s leadership development and appointments, please get in touch with Hannah Scarisbrick or Ginny Jones in our team.