Radical Capital: Landmark Report

Bringing together 60 major players across the private and public sector.

Were we too harsh on Boris? No. Here’s why.

We respond to some of the debate yesterday's blog stirred up.

Businesses must get more vocal over lockdown

Winston Churchill once said: “Those who fail to learn from history are condemned to repeat it.”

Real estate will play a central role in capturing the potential of UK life sciences

UK life sciences may be the perfect coronavirus cure for the UK economy, but real estate must be on hand to support the science.
ilke Homes - Modular Housing

Innovation will be key to getting Britain building again

Covid-19 is an opportunity to bring UK housebuilding into the 21st century.

How modular manufacturing can provide new jobs in the wake of retail’s demise

With retail jobs disappearing by the tens of thousands, perhaps modern manufacturing can pave the way for a new-look workforce.

Tackling the Housing Crisis

How do you solve a problem like the UK’s housing crisis? Blackstock Consulting sat down with a host of industry experts to discuss exactly that.

Modular housing has the potential to play a crucial role in delivering the homes needed to meet the government’s ambitious 300,000 homes a year target.

Speeding up delivery will be essential to meeting these targets, and given that offsite manufacturing, on average, delivers homes twice as fast as traditional construction, many in the sector believe it will have a major role to play in tackling the housing crisis.

But if modular is going to deliver on its promise and secure the necessary investment and gain public trust, educating investors, policy-makers, local authorities and consumers will be crucial.

Tackling the negative connotations attached to prefabs which continue to tarnish modular’s reputation will be a crucial first step, both from both an investor and consumer perspective. A unified message from the sector will be fundamental to achieving this.

“We need a feedback programme to build demand for the modular product, and I think that in itself will generate capacity and give businesses the confidence to build new factories across the country,” says Val Bagnall, managing director of Apex Airspace, a modular housing provider.

Consumer confidence in modular homes will be based on its build and design quality, according to Michela Hancock, managing director of construction and development at property developer, investor and manager Greystar UK.

“People don’t necessarily know, nor do they care if their home is a modular product. What they do care about is the quality of the product and if it’s sustainable and well-run,” she said.

Dave Sheridan, executive chairman of off-site manufacturer ilke Homes, believes this flexibility does not negatively impact design quality.

“Modular doesn’t just have to be for the entry-point house, it can be designed to be aesthetically pleasing. You can dress a modular product to be extremely attractive.”

However, more support will need to be seen at the local level according to Andrew Prickett, UK Head of Residential at Faithful+Gould and Tony Dicarlo, Developer and Investor at innerspace Homes if modular is to achieve its full potential.

The last housing minister Kit Malthouse and housing secretary James Brokenshire both backed offsite construction during their tenures. Indeed Malthouse said of the 750 home deal between ilke Homes and Places for People that it showed the UK blazing “a trail in the modern methods of construction that are transforming home building.”

However, convincing local authorities to embrace modern methods of construction is proving more difficult.

“At the central government level, offfsite and modular is hugely supported – they are really backing it, but that’s not filtering down to local government and definitely not the planning system where it is not even in the National Planning Policy Framework” Tony DiCarlo, founder of modular house builder Innerspace says.

Andrew Prickett, director, UK head of residential at project and programme management consultancy Faithful and Gould, suggests that access to land and scaling up pilot schemes would be a step towards accelerating the widespread adoption of modular and offsite.

“Let’s back SMEs, new thinkers and innovation and let’s scale up. Instead of smaller pilot schemes, we should think more ambitiously and consider 200 to 300 homes developments,” he says.

“We could have a pre-assumption that new council houses are built using this technology unless there is a watertight business case for not doing it,” he adds.

In her first speech as Housing Minister at RESI 2019, Esther McVey made it clear that encouraging home-ownership was a clear priority. But how will first time buyers be helped onto the housing ladder now that Help to Buy is being scrapped? 

The harsh reality is that is not a one size fits all solution to the problem.

“Help to Buy was born out of the post-recession world and has since gone from being a safety net to a jetpack for profits at some of Britain’s biggest housebuilders. Rescuing firms was the number one aim of the scheme with little thought being given to when the market eventually stabilises,” says Adam Challis, head of living research and strategy at JLL. 

Vanessa Hale, director of research at BNP Paribas Real Estate and chair of Urban Land Institute (ULI), agrees with Challis, but praises some companies who are actively seeking to diversify.

“HTB certainly has a political slant that we’re going to have a hard time getting away from, but housebuilders, such as Telford, who have been moving towards increasing their proportion of build-to-rent homes, are looking towards solutions.”

Telford Homes, which recently entered two build-to-rent partnerships with asset manager M&G Real Estate and Invesco, accelerated its shift towards the build-to-rent sector last year, accounting for 70 per cent of the company’s development pipeline.

During the discussion, panel experts shared the consensus that there isn’t going to be a ‘one size fits all’ solution to life after HTB.

“A one size fits all approach will fail. What the market needs going forward is a range of products such as build-to-rent and shared ownership”, says Challis.

Mergers, modernisation and a focus on expanding shared ownership are helping housing associations take centre stage in fighting Britain’s housing crisis. There is a huge opportunity for joint ventures and collaboration with the private sector.  Yet according to two leading G15 members and the head of the sector’s trade body, there is still a huge shortfall in grant funding needed to provide adequate quantities of social housing.

Tackling this will require  more funding, strategic partnerships, and a cohesive, long-term investment strategy from the government. 

According to the National Housing Federation (NHF) , housing associations are receiving roughly just a tenth of the grant funding needed, with the government spending just £1.27bn on affordable housing, making housing one of the smallest government budgets

“What we need is a long term investment package from the Government. We were asking for £12.8 billion a year. It’s a lot of money, but it means we could deliver 145,000 affordable homes each year which we know we need over the next decade,” says  Kate Henderson, CEO of the NHF.

“Our research shows we need around 90,000 social rented homes each year. Last year we built 6,000. We are an incredibly wealthy nation but some people’s housing needs simply won’t be met by the market alone,” she adds.

Alan Strickland, director of external affairs and resident involvement at Optivo, agrees that more government support will be crucial.

“The government needs to continue investing in social rent, and it’s absolutely critical that people can continue to have a home they can afford. Fundamentally, both on affordable homes for rent and for sale, housing associations totally stand ready to help, to invest, to build and to work with communities.”

Shared ownership is one crucial tool that housing associations can promote to boost home-ownership. Fundamentally, this method means that even with increasing property prices, people on an average salary will have a chance to be able to afford a home. 

“We have a big development pipeline with shared ownership and we’ve been doing it since the 80s. It’s a hugely resilient product, it is the most affordable way that people can get onto the housing ladder.If you’ve got a £500,000 property, then £125,000 is the equity share that you can buy. All in all, you’ve got people who are on about £35,000, and they can afford to buy there. So it is affordable – it’s the only way a lot of people can live in London”, Geeta Nanda, chief executive of Metropolitan Thames Valley, explains. 

To listen to more of PropCast, Blackstock Consulting’s podcast series which focuses on relevant industry topics with top professionals in the space, subscribe to our podcast via Apple Podcasts, Spotify or SoundCloud.

Planet Property’s need to be green

A man dressed as a broccoli arrested on the streets of London and people glueing themselves to tube trains before getting a good shoeing in Canning Town can only mean that the Extinction Rebellion are back in town.

The merits of these protests can be debated endlessly.

But it is becoming increasingly accepted by both business and politicians that climate change must be taken seriously.

Clearly, property must play its part given that the built environment is responsible for roughly 40 percent of the UK’s total carbon footprint, according to the UK Green Building Council.

However, while property may often be maligned for being an old fashioned club of chaps in blue suits, real estate is increasingly becoming aware of its responsibility as an industry to implement changes to tackle climate change.

In September, 23 property companies with a total of over £300bn of assets under management signed up to a climate change commitment, launched by the Better Buildings Partnership, requiring them to pledge that their portfolios will be net zero carbon by 2050, and that they reveal how they intend to reach that target.

 There are business reasons for investors and developers to look towards backing green projects. One, it reduces the risk of being exposed to stranded assets as the UK and global economy shifts towards this being the norm.

And, two, increasing numbers of investors are making it clear they will not put their money into vehicles that back projects that are harmful to our environment. This is becoming more than just a fashion for a small minority. It’s a clear and swelling trend.

Less polluting buildings, whether homes or offices or factories, will improve our air. Recent studies have shown that air pollution is killing as many Brits as smoking does a year. And of course, these pollutants in the air exacerbate conditions like asthma, adding stress to our already under pressure NHS with research showing 1,000 London hospital admissions a year due to asthma and other lung conditions caused by poor air, for example.

The benefits of a greener built environment are not just restricted to our health. More efficient homes will cut household bills, which in turn will increase their spending capacity. That’s good news for our economy.

But it’s not only in new builds where we need to see a push for green. Many of our older buildings are gas guzzlers, and an immediate and sensible step the government could take would be to eradicate VAT charges on refurbishment, much like the French have.

This would encourage investment appetite for refurbishment and help us start to fully decarbonise our building stock.

Design must also play its part.

Leading voices in the architectural world have acknowledged this fact, with Assael Architecture becoming the UK’s first practice to adopt the UN’s Climate Neutral Now Initiative. Through the initiative, Assael must now calculate and disclose its current carbon footprint, including international air travel, showing a clear pathway to reducing it year-on-year.

Architecture can also be a powerful tool towards building a sustainable future. Through the use of natural materials like timber and cork, as well as the use of greenery in developments, new buildings can absorb much of the greenhouse gasses that we produce, radically reducing our emissions and helping us to live healthier lives. Greener architecture has also proved itself to be a future proof investment, with green homes becoming quite the status symbol.

It’s clear that the property industry has in fact made a number of significant strides in the right direction. We have the means and motivation to transform the built environment in the UK and the way it operates, but now has to be the time to seize this opportunity.

Paying for the long term BTR model

One of the biggest advantages yet biggest barriers of Build to Rent (BTR) is that developers and operators take the long-term view.

They don’t build and walk away, like a traditional house builder, and as a result there are a lot more happy tenants, and happy local authorities.

But this structure has a massive impact on business practice and it’s a lot more expensive up front. While other investors look to trade at different stages of the asset’s life cycle, a BTR fund aims to hold for long-term income.

That means, from day one, income needs to maximised and costs streamlined, because it’s so much more expensive to build.

Traditionally, to make returns stack up, operators have had to take on development risk, which has in turn led to problems around finance. Typically banks will only lend on permitted schemes and are increasingly being discouraged from risk by regulators. Likewise many institutions will only touch stabilised assets.

But buoyed by the fundamentals of the market and by the positive political support, the signs are more positive right now.

And appropriate explanation, planning and development of that long-term development model can also go a long way to encouraging lenders: essentially by showing a greater focus on what happens post development.

This means, practically, ensuring the scheme is in the right location and has the right attributes for the rental market. It also means focusing on the operator is and what the gross-to-net margins look like. There will be considerations around amenity and layout, but also the building materials used and their longevity.

It also means more focus on the assumptions of development: assumed rents and how they compare to the local market average, and gross to net leakage, which is generally considered to be at least 30% – are the most important.

For management, it means seeing if a sinking fund has already been set up, to ensure buildings remain as good as they are on day one, and how the operation of the building has been planned, whether with an in house or external agent.

The more a developer operator can show it has been thinking about this now, and importantly making realistic assumptions, the easier it will be for a lender to stump up the cash.

It’s a long-term investment, which means we should already have long term plans. Simple, no?

The local authority potential for Build to Rent

We should not be ashamed of the fact Britain is reliant on private finance to deliver new infrastructure. And there’s no reason why we should not use partnerships with the private sector to build thousands of Build to Rent (BTR) homes.

From major projects like the Thames Tideway scheme and airport expansion to new schools and hospitals made possible through PFI, state spending is subsidised by business.

Housing is no different.

Since the 1980s, governments have almost entirely depended on the private sector to deliver public policy. But Britain’s continued failure to build enough homes has led to calls for a rethink.

While local authorities now lack the resources needed for a programme of mass house building like we saw in the 1950s and 60s – even with changes to borrowing – there are other ways the public sector can help.

It remains one of the largest landowners in the country and organisations like the NHS and MoD possess the kind of brownfield sites successive governments have long prioritised for development.

With the public coffers under renewed pressure, renting could provide long- term income streams enabling public bodies to generate cash flow, without selling off the family silver.

The first steps were taken by the coalition government, which introduced the Infrastructure Act 2015, giving the Homes and Communities Agency additional powers to speed up the release of surplus public land. By 2016, 899 sites had been released – enough to build over 100,000 new homes.

More could be done but this will require initiatives from both the public and private sectors.

Firstly, central government must ensure all its departments adopt a modern view of “best value”. This means having proper reports and valuations from consultants and experts on how best to approach the disposal of public land. This will allow them to realise and demonstrate the wider benefits of any disposal.

Some local authorities have already taken the initiative. In Manchester, rather than taking a one-off approach, the city council has pooled together money from the DCLG and local pension fund to create a joint venture focused on housing.

But the solution is never just simply copying a model others have implemented.

Local authorities should be adventurous if they want to close the funding gap. Devolution offers more opportunities than ever before to be more creative in thinking and planning in this area – let us hope they seize them.

Blackstock’s 18 for ‘18: A review

Last year, the Blackstock team put forward some predictions for how 2018 would play out. Let’s see if we were right:

Residential capacity: Tipping point or teetering over the edge?

With the housing and planning bill under debate in the House of Lords, the timing couldn’t have been better for the ULI to host the ‘Residential Delivery Capacity in the UK’ seminar on the 26th April. Close to 100 people flocked to the Royal Geographical Society to discuss how we can match our housing ambitions and bring targets into reality.

Vice-chair of the ULI UK Residential Council and chief executive of Cast, Mark Farmer kicked off the day by setting out the challenge facing the housebuilding sector: an ageing workforce, low productivity, and out-of-date working methods. Farmer believes that “we find ourselves at a tipping point”, with three times as many people leaving the workforce a year than joining it. Few young
people wanting to take up construction means that in 10 years’ time, 20 per cent of all workers will be aged between 55 and 64.

There’s also the challenge of low productivity, which, for construction has flatlined in recent years. The Cast CEO made sure to remind the audience that increased productivity won’t just come from “laying more bricks an hour, but fundamentally changing the way we go about building homes, including a greater use of offsite methods.”

Farmer concluded that, unless the construction sector changed its working models, it was in real danger of being “unfit for purpose in a few years.” Lucky, then, that the government has recognised this with Farmer conducting a review into the skills shortage at the request of ministers, Brandon Lewis and Nick Boles.

Simon Rawlinson, head of strategic research at Arcadis, the day’s sponsor, was next to step up to the plate, bringing stacks of facts and figures showing the gravity of the situation. Rawlinson reckoned there were “no more than 300 unemployed bricklayers in London and the South East at any one time.” This severe shortage in skilled workers will shackle any attempts to boost housebuilding.

Backing up Farmer’s earlier comments, the Arcadis man went on tell the audience that in one quarter in 2015, the industry lost 70,000 workers. Co-authors of Arcadis’s People and Money report last year, Farmer and Rawlinson were in unison on the benefits that offsite construction can bring both in attracting more people to the sector and making the work itself less labour-intensive.
Hot on their heels, housing and planning minister Brandon Lewis gave a keynote speech, underlying the government’s ambitious housebuilding targets. The minister praised industry players that are taking up the mantle of offsite construction, like L&G, Laing O’Rourke and Essential Living for its Creekside Wharf scheme in Greenwich. Lewis also thanked those who had made his life easier by cutting the time it takes to build a home to weeks rather than months!

With so much information packed into a half day, it might have been hard to reach a clear conclusion, but thankfully Farmer stepped in to conduct a straw poll at the end of the session. Only one or two of the audience members believed that we’d build one million homes by 2020. But it wasn’t all negative – the audience were unanimous in their support for offsite construction and the opportunities that emerging asset classes, like build to rent, offer.

London housing: Between a Trot and hard face

With some flats in central London costing more than a private island, its small wonder housing is considered the number one issue facing the capital.

All the candidates have fallen over each other promising ever more homes as a result. There’s little detail on how they’ll be delivered, just the usual vague promises to release more public land or tweak the planning system.

The simple truth is the Mayor of London doesn’t have the power to solve London’s housing crisis alone. Many of the factors pushing up demand – low interest rates, public subsidy, increased household formation – are beyond their control.

But while the Mayor can’t in reality make the housing crisis much better, they could definitely make it a lot worse. And sadly in Sadiq Khan and Zac Goldsmith, the two leading contenders, exactly that will happen.

It’s hard to see who will be worse: Khan wants the power to freeze rents – and even Swedish socialist economists will tell you rent controls don’t work – while Goldsmith previously described himself as a ‘proud Nimby’.

Khan thinks 50 per cent of all new developments should be affordable housing, which would render many unviable, and Goldsmith has a pathological aversion to anything tall.

In an effort to put ‘Londoners first’, both demonise international buyers. The Panama Papers have raised some (justified) questions about foreign ownership of London property, but global investors are crucial to financing development activity and shouldn’t all be tarred with the same brush.

Admittedly there are a few areas they do get right: welcoming further institutional investment into the rental market stands out. Their joint support for additional transport infrastructure is also positive. Crossrail has helped unlock new opportunities for developers and no doubt Crossrail 2 will do the same.

But a serious mayoral housing strategy would focus on working with central government and the surrounding counties.

While the politics of planning is often local, the legislative framework remains national, and still largely rooted in the 1947 Town and Country Planning Act. Fundamentally, this needs replacing with a North American or European-style rules-based system, which makes far greater use of zoning and is presumptive in favour of development. Reform on this scale can only come from Westminster.

The worst legacy of the 1947 Town and Country Planning Act is the greenbelt. An arbitrarily defined no-go zone for developers, it has acted as a constraint on growth for London and critically, nearby commuter towns. This is why a joined up approach to housing with neighbouring local authorities is needed.

The leafy Shires around London need convincing overhauling the greenbelt doesn’t mean urban sprawl. The case for action is clear: if you want the city you so rely on (as does the rest of the country) to remain internationally competitive, it needs homes for its workers. And many of those homes will have to be built on the greenbelt.

Collaboration between London and adjoining authorities could go much further, with the pooling of funds to attract large-scale investors and bankroll development as Greater Manchester’s councils have done.

Manchester and other regional cities might offer another way out of the mess too. The base reason for London’s affordability issues is the sheer volume of people who want to live here. But turning them away would be economic self-harm. So the solutions must be supply-side (building more homes to house them all).

Yet if the Northern Powerhouse and Midlands Engine emerge as genuine competitors, and don’t just stay buzzwords, the flow of young people and migrants looking for decent jobs and that metropolitan buzz could start to shift elsewhere.

In short: to fix London’s housing crisis, think beyond London. It’s a shame Sadiq and Zac won’t.

Pension funds key to fixing the estate we’re in

What politicians have ignored for decades is that poor housing is the root cause of many of society’s ills, something the prime minister has today admitted. While Tony Blair’s government did much to address Britain’s inner-city problems, it failed to fix housing. And despite dozens of announcements – and record low interest rates to borrow at – the State has not taken a major role in development since the 1980s.

Today’s announcement of plans to redevelop Britain’s sink estates through the setting up of an investment fund should be universally welcomed. As I’ve said today on Sky News, the reality is that £140m alone is like a pinch of salt in the Atlantic when it comes to the amount of cash we need. Therefore, the key to this will be having the right structures in place to attract pension fund investment, as the government has suggested.

There has been no better time for this: institutions have stayed away from residential property for over a generation. But poor performance of traditional investments – like bonds and equities – have made them look twice at price. It’s more stable, offers solid, often index-linked returns, and can help plug the gaps many pension funds have in their books through long-term capital growth. But pension funds hate risk. And there’s nothing riskier than construction and planning.

Ensuring these projects can be adequately de-risked will be essential.

Another critical element will be the rights of residents to return – something else that the government’s statement addresses. As I have written about before in Inside Housing, large-scale social housing regeneration projects often fail to put enough social housing back. Ensuring residents not only have the right to return but can afford to do so will be the key point here. We should see a commitment around having the same proportions of homes at subsidised rents for those who truly need them (rather than those people with jobs who have never bothered to let the councils know).

Getting the mix of affordable and market rented homes right should not be too difficult. It’s already being done as we speak: private companies are now becoming the biggest delivery vehicles for affordable rented homes. In Greenwich, Essential Living, the UK’s first developer and operator of homes for rent, won planning consent for 249 homes with a quarter to be for discount market rent. The rents will be between 55% and 75% of market value and will be pepper-potted within the scheme.

The Creekside Wharf scheme won the Sunday Times Homes awards for Best Housing Project and was lauded by the Labour council for being “innovative” and “community-focused”.

Proposals by Essential Living for a major 500 home regeneration scheme in west London at the Perfume Factory, part of the Old Oak Common regeneration zone, will be considered by Ealing Council next month with a similar offering of discount market rent homes.

Up the road, also in Acton, HUB, a residential developer, is doing the same in its scheme funded by M&G Real Estate, one of the UK’s oldest institutions.

Up until now, the government’s focus has been on promoting home ownership at all costs. In spite of warnings from the Bank of England (and anyone else who lived through the 2008 crash) that spiraling debt is risky, a barrage of proposals encouraging first time buyers to take out hefty mortgages with 5% deposits have come forward. This is short sighted.

A greater focus on Build to Rent should be promoted by the prime minister, not least because companies like Essential Living, which is backed by London-based M3 Capital Partners, who manage global institutional capital, are already doing the sort of thing they are now promoting.

Other major businesses like Legal & General and Greystar, an American developer and operator backed by global capital, are also entering the market in Britain. Fizzy Living, another Build to Rent brand, is backed by Middle Eastern cash.

The future of funding the homes we need will very much be in the hands of global players – not the same old housebuilders whose stock rises and falls in line with the economy.

We need new ideas and above all, new money which can take a long term view, not a three-year view in line with what shareholders demand.

As the report I authored last August (“Funding Britain’s Rental Revolution”) showed, major investors are queuing up to come into the sector. Published by Addleshaw Goddard and the BPF, the report was widely covered by the FT, WSJ, BBC1 Breakfast and Radio 4. It noted that £30bn of institutional investment was already on the table. More recent estimates put this at £50bn.

This is the kind of capital the prime minister is talking about harvesting through its £140m fund. He should invite these guys in for a cup of tea.

In conclusion and as is ever the case, the key to this will be the detail. But the intent is laudable and the government’s track record of promoting institutional investment in strong. Its Build to Rent Fund has helped cut the costs of developing for rent, for example.

Yet there are several things that need to happen for this to succeed. It will need the right structures in place to attract pension fund cash. Having the right advice here is key: they must seek advice from those who have already done this.

Building large scale developments for market-price rent also needs to be prioritised. The prime minister cannot ignore this any longer. His housing minister Brandon Lewis has been highly supportive of Build to Rent. But many councils don’t have a clue. This has to change.

Ensuring residents can actually afford to live in redeveloped estates is crucial if we’re to preserve the social fabric of our communities. All too often developers come in, cash out and shift people far away. This is morally wrong and highly unfair. It’s good to see this has been recognized.

Finally, as Labour’s Lord Adonis said, we must build higher, getting away from silly rules preventing height and nimby attitudes against change. Many people in the Conservative Party itself oppose high density development, but it is the only way to do this. If you want to do more with the same space you have to build up.

However, estate renewal makes far more sense than build outwards on green field land, creating more urban sprawl.

In Michael Heseltine, the man who oversaw the regeneration of London’s docks in the 1980s, there’s nobody better-placed to manage this process. Let’s just hope he’s looking forwards and outwards at the solutions which are largely already in front of us.

Heathrow & housing: UK’s planning disease of faux-democracy holding back progress

Brits love to snarl bitterly at China on account of pollution, human rights and the ease with which you can buy knock-off goods or rip-off Western IP. Yet they know how to build infrastructure – quickly.

Whether or not the dozens of airports or thousands of posh city centre pads China’s been building recently will all be profitable is another matter. But with Britain seemingly back at square one in the Great Runway Debate, floundering when it comes to dealing with renewable energy and decades away from delivering the housing successive governments lie about, the moral high ground seems to be getting us nowhere.

During my time at what was then BAA five years ago, we couldn’t have the Third Runway debate publicly. National newspapers – which have in the last week been sticking the knife into the Tories for not backing Heathrow expansion – were all against it.

The U-turn in media opinion has to a large degree been led by the prevailing winds of common sense proving you can’t operate on a knife-edge without operational efficiency being sliced whenever it’s windy, foggy or someone leaves a bag next to Costa.

Of course, there are very good reasons to oppose Heathrow expansion just as there are for and against Gatwick. Alistair Osborne’s column in The Times was rather astute in predicting that Gatwick’s estate agents could find gainful new employment working on the baggage carousels.

A lot my current day job involves advising property developers and investors who are held back by the same ridiculous web of nonsense: planning. Under the illusion that everything is “democratic” anything not to the liking of the minority can somehow be held up, often in perpetuity.

Rather than by a system of outright democracy – where the good of the whole is considered – planning in Britain favours self-interest. Local politicians duly ignore policy and process to place their own views ahead of what’s right. And as a result, tens of millions of pounds of public money is wasted each year in court when ridiculous decisions are overturned.

Nobody should be carte-blanche to do anything but we need to stop playing politics with everything and using airports, housing and power as government kick-balls.

Blackstock, the policy and communication consultancy I now run, published a planning manifesto in partnership with Addleshaw Goddard, a law firm that works with HS2, Sainsbury’s and many large developers. In it we called for a single, long-term national plan to agree infrastructure for a generation. Canada has this.

We also called for London to be turned into a five-borough metropolis, like New York. This was widely covered by the BBC at the time and hilariously drew anger from much of the establishment.

For what it’s worth, my view on Heathrow is that we need to expand it and secure our immediate transport needs. We should offer large incentives for greener planes and tax the hell out of the dirty ones, ring-fencing that cash for renewables. Of course there will be fall-out, but many of the people who live round the corner did not move there before the airport existed.

Ensuring that people are fairly compensated for homes that need to be bought – much as we did for the Olympics and will do for HS2 – is crucial.

Heathrow is a hub airport – where short-haul flights feed long-haul jumbos – and this makes it a fundamentally different offer from Gatwick or other regional airports. We need these long-haul links to support our economy and they can only work with the right economies of scale.

If the business lobby groups who shouted angrily this week had turned the screws on MPs before the election maybe things would be different. The corporate members of London First and the Chambers of Commerce employ hundreds of thousands of people. So while companies don’t vote, these groups could have harnessed the support of employees to enact change.

This didn’t even cross their minds.

Ultimately, Heathrow is the best short-term solution we have, however flawed it may be as a solution. Over the long term, we should indeed look at regenerating the eastern side of Britain with a new airport forming part of a new commercial centre.

One positive outcome from all of this could be that if Heathrow did shut there’d certainly be enough room to build tens of thousands of homes. It might just take them a while to get to the airport.