The Interim Chair of the Land Development Agency, John Moran, has said that bigger and bolder ideas are needed to rejuvenate underused areas in the country’s cities and to ensure balanced regional growth.
He said that with the population projected to grow by one million people by 2040 – and 75% of that growth earmarked to take place outside Dublin – drastic and significant changes will be needed to cope with such growth.
Mr Moran, who is speaking at the national conference of the Society of Chartered Surveyors Ireland in Dublin this morning, (Wednesday) said the LDA must focus its efforts on enabling higher density urban supply if it is to fulfil its mandate and facilitate the delivery of 150,000 homes by 2040.
“We don’t do densified living well in Ireland. A culture change is needed. Dotting the landscape surrounding cities, even villages with semi-detached developments and one-off housing will not answer the challenges that come with drastic population increases and climate change.”
Mr Moran pointed out that only 5% of a €2 billion urban regeneration fund was applied for in 2018. The fund is open to applications by local authorities and/or other state agencies.
“The Urban Regeneration and Development Fund (URDF) was allocated €2billion for expenditure between 2019 and 2027. Five percent of the fund was successfully applied for in 2018. Based on 2018 figures, €1.3 billion, or 63% of that fund could remain in 2028.”
“While re-positioning individual State-owned sites for development is a good start, the ambition for the LDA means it must also look beyond individual site development….. Unprecedented collaboration between the different state agencies, private sector, social bodies and funding programmes will be required to achieve an optimal outcome.”
The President of the Society of Chartered Surveyors Ireland, Johanna Gill said the SCSI fully supported an ambitious approach by the LDA but said the agency would need Compulsory Purchase Order (CPO) powers if it was to be successful in increasing the supply of affordable housing.
“There is real concern that CPO powers will not be included in legislation establishing the Agency. Given the projected population growth its clear the housing crisis is only going to get worse unless projects of scale are undertaken by the LDA. We believe the power of CPO will be critical to its success and will help prevent key projects being delayed.”
Ms Gill said that while sourcing sufficient serviced land was one issue, driving down building costs was another.
“One way of addressing both these concerns is to reduce Capital Gains Tax on serviced land for a defined period of time. Development land has been increasing in value by double digit figures for several years – we estimate the land costs of a new three-bed-semi is €60K or around 20% of the total cost – and is one of the key elements in the ‘soft costs’ of a new house. This is not sustainable.”
Ms Gill acknowledged that the construction sector needed to be open to new technologies which would increase efficiency and drive down costs.
“Recently the Taoiseach claimed that inefficiency and outdated practices in the sector were ‘holding Ireland back’. There is undoubtedly some truth in what the Taoiseach is saying, and this is an area where we could and should be doing better. However, we can’t do it on our own.”
“For many years we have been calling for investment in off-site /modular construction and for the establishment of an authority to lead and co-ordinate the adoption of other new construction technologies. Given that the construction sector’s output was valued at €21 billion last year and employs 150,000, the level of investment required to establish this authority would be quite modest. If the government is serious about encouraging the sector to adopt new technologies, it needs to act now” she said.
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