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About us

Copping Joyce is an independent multi-practice firm of Chartered RICS Surveyors & Valuers, carrying out work across Greater London, the South East & East Anglia.

As an established SME with a company history dating to 1898, we are pleased to be a firm large enough to offer a comprehensive range of professional services, while retaining the agility to tailor those services to the individual needs of our clients.

Our services include commercial and residential valuations, investment and development acquisitions and disposals, commercial and investment agency, insolvency, social housing valuation, expert witness services and building surveying.

Our aim is to get things done to our client's satisfaction by delivering professional and sound advice. We have a wide range of clients including banks, local authorities, developers, housing associations, property companies, public bodies and the general public. Totally committed to clients’ needs, our RICS chartered surveyors always aim to respond efficiently and effectively.

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Changes to the planning system in England: What to expect?

Earlier in August 2020 the UK government laid out proposals to reform the planning system in England. The proposed changes aim to streamline and modernise the planning process; improve design and sustainability outcomes; deliver infrastructure more efficiently; ensure developers play their part through contributions; and that land is available where it is needed.
 
A brief summary of the proposed changes to the planning system is as follows:
 
Local Plans and Zoning
 
The White Paper emphasises the statutory obligation for every area to have an up-to-date Local Plan in place. Sanctions will be introduced for the local authorities who fail to have a plan in place within 30 months from the legislation being brought in force, and local plans will have to be reviewed at least every 5 years. The proposals also aim to simplify the role the local plans to focus on categorising land into three groups:
 
  • Growth Areas suitable for substantial development will receive automatic outline approval for the principle of development. Within this context, planning decisions will focus on resolving outstanding issues. The full permission will be achieved through streamlined consent routes.
 
  • Renewal Areas will receive an automatic consent for types of development specified in the local plan, provided the development meets certain standards, including design. For other development types, the planning application would be determined according to the Local Plan’s description* of what sort of development the area or site is appropriate for, and with reference to the National Planning Policy Framework, a Local Development Order or a Neighbourhood Development Order.
 
  • In Protected Areas, such as the green belt, development will be restricted, with planning applications determined by local authorities with reference to policies set out in the National Planning Policy Framework.
 
The introduction of zoning will mean streamlining the opportunity for public consultation at the planning application stage. However, democratic accountability will be safeguarded at the plan-making stage as local plans will be designed in consultation with the local people.
 
Furthermore, Local Plans will no longer contain general development management policies, leaving them to be defined at a national level. Instead, the new local plan will contain a core set of site- and area-specific requirements for development, together with locally produced design codes.
 
* In both the Growth and Renewal areas, proposals which are different to the plan would require a specific planning application.
 
Developer Levies
 
Section 106 and Community Infrastructure Levy payments will be replaced with a new tax due on the final value of the scheme (once fully occupied); developers caught preventing occupation to avoid the charge will face sanctions. Revenues from the new developer levies will be spent on the delivery of discounted homes, new roads and upgraded playgrounds.
 
The new levy system will remove the opportunity to negotiate planning obligations, subsequently helping local authorities to avoid situations where large developers employ lawyers to get out of their side of the agreement. Moreover, the local authorities will be able to borrow against the levy to help forward fund projects.
 
Developers will qualify to receive a discount on the levy if they build affordable housing. This discount will equal the difference between the market price of flats and the price at which they were sold to the affordable housing provider. The Government also plans to extend the current exemption of small sites from having to make S106 payments towards affordable housing.
 
Design
 

The new rules will place more importance on design. Design code for each area will be prepared as part of its local plan and will have to be in accordance with the National Design Guide, the yet to be published National Model Design Code and a new Manual for Streets.

Furthermore, the reformed planning system will introduce a "fast-track for beauty", granting automatic permits for "proposals for high-quality developments where they reflect local character and preferences".
 
Sustainability
 
The local plans will be subject to a single statutory “sustainable development” test, while unnecessary requirements and assessments that cause delay and challenge in the current system will be abolished. This would mean updating requirements for assessments, abolishing the Duty to Cooperate  and replacing the existing tests of soundness.
 
It is expected that from 2025 new homes will produce 75-80% lower CO2 emissions compared to the current levels. These homes will be ‘zero carbon ready’, and, over time, as the electricity grid decarbonises these homes will have the ability to become fully zero carbon homes, without the need for further costly retrofitting work.
 
If the paper passes the legislation, it will mark a dramatic shift in the fundamentals of the English planning system. The consultation will last for 12 weeks from 6th August 2020.
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How to value land without planning?


Establishing the value of a site without planning consent can be complex, especially if there is no pre-application advice or planning history. The two main approaches to valuing such sites are the comparable and residual methods of valuation. We will look at both methods and discuss the pitfalls in more detail.

Comparable Method

This method involves analysis of sale prices of comparable land without planning that has recently sold in the area. Unfortunately, in most cases, up-to-date and relevant comparable data may not be available. Another point to consider is that each site is unique and, adjustments need to be made when analysing your evidence. For instance, your comparable site may have positive pre-application advice at the date of sale, is capable of accommodating higher unit density or has contamination issues that need remediation. These factors will have a significant impact on the £/per acre figure and thus, without knowing all the details of such transactions, may prove to be irrelevant or misleading when arriving at a site value.

Residual Method

When using a residual method of valuation, two main components are required to ascertain the value:

  • Potential Gross Development Value (GDV) of a scheme, less
  • Development costs

Gross Development Value

This figure is crucial as it is the foundations of the residual valuation and is based on a special assumption of development completion and planning. The GDV of a scheme usually is relatively straightforward to estimate using sales comparables. However, when valuing a site without planning with no proposed scheme in place, this can become much more complex. As such, it is vital to establish what scheme the subject site can accommodate. To do so, the developer must seek professional advice from suitably qualified planners and architects.

Development Costs

The second step of a residual valuation is to calculate the development costs. Briefly, this figure will include the construction costs, professional fees, contingency, demolition, clearance, vacant possession costs, insurance, CIL & S106 liability and finance costs. These assumed costs will be similar to the once you apply when valuing a site with planning. Additional costs that need to be taken into account, given lack of planning consent, are:

  • costs associated with obtaining planning
  • increased holding costs
  • site purchase finance costs (may be higher than for a site with planning considering increased risk from lenders perspective)
  • increased required developer's profit
Naturally, every developer would work with different profit margins, but the rule of thumb is a 20% developer's profit on costs for sites with planning. This profit represents the risk associated with development. When acquiring a site without planning, the risk exponentially increases and this needs to be reflected in your required profit margins. Vincent Goldstein, the CEO of VFund, offered his insights on how his company sets the appropriate profit margins where they "look at all deals on their merits, and the expected profits will vary on factors such as location, risk, length of the deal, downside and holding costs". As a developer, you might consider increasing your required profit (perhaps by 10%+) to compensate for the additional risk.

The main shortcoming of the residual method of valuation is that it is susceptible to the assumptions you make. Relatively small changes in the costs or revenue can have a disproportionately large impact on the value of the site. For instance, one of the assumptions is that the GDV value of the asset will remain the same at the end of the project, which historically proven to be incorrect especially during the period of high market volatility.

Getting it right

Acquiring land without planning is risky, but it may deliver increased profit if done correctly. Thorough due diligence is crucial when purchasing land as you might end up with a scheme of a lower than anticipated density or, the worst-case scenario, unsuitable for development. Russell Tomkins, a Director at RCT Construction, with decades of experience in development sector emphasised the importance good professional advice saying that the key three steps are to "get a VERY good architect with planning experience, a good planning consultant and know who to go to for all the required reports".

Paying the right amount for the land is essential for delivering a profitable scheme. Thus, a developer should not rely on a single valuation method but utilise both comparable and residual valuation to arrive at an accurate figure. In addition, it is appropriate and strongly recommended that a developer undertakes a robust sensitivity analysis to ascertain how changes in GDV and development costs may impact the profitability of the scheme.

Please speak to our Development Team to find out more.
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Westborough Road, Westcliff-on-Sea, SS0

A development/investment opportunity sold to a private developer by our Receivership Department.  The property was subject to an Enforcement notice due to being built too far at the back.

Speak  to our Recoveries Team to find out more.

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