Housing Funding and Due Diligence
The Greater London Authority (GLA) and the Homes and Communities Agency (HCA) separately tasked Cushman & Wakefield with advising them on the provision of funding to strategic housing developments where public sector funding could speed up delivery.
The GLA has access to £400m of public funding (a mixture of loan and grant funding) to support the delivery of 50,000 new homes in London in the programme’s first phase (with more to follow). The HCA (through the HCA-I, Kickstart and other programmes) has similar objectives (but outside of London) and provides funding which runs in the multi £billions over the last 8 years to unlock strategic schemes.
Both public sector bodies need to ensure that all schemes which apply for funding fit the various programmes’ objectives, in particular, accelerating housing delivery but also providing best value to the public sector agencies.
Cushman & Wakefield pooled its expertise in strategic residential, development and regeneration for both clients to provide market facing due diligence advice which will accelerate the delivery of new housing in London and across England. Our role involves:
- Analysing the local residential market
- Validation of bidder revenue, construction and infrastructure cost assumptions
- Assessment of key development assumptions
- Testing the impact of interventions on delivery trajectories
- Identification of key project risks and mitigation
- Validation of development programme assumptions
- Confirmation of valuation evidence
- Financial model cash flow profile assessment
- Confirm investment required
- Reviewing land ownership information and planning agreements
This analysis is presented in a concise report format to identify key issues, additional information requirements and the need for contractual conditions. Our roles for both the GLA and in relation to the HCA’s Kickstart programme have involved the development of a bespoke Excel financial model to provide a robust framework for assessment.
For the GLA, Cushman & Wakefield has to date successfully completed due diligence of schemes in Barking & Dagenham, Ealing, Enfield, Lambeth, Lewisham, Redbridge, Waltham Forest and Wandsworth. This has allowed the GLA to release financial support with a value approaching £100m.
Cushman & Wakefield built the financial appraisal tool that was used by HCA’s consultants to assess the delivery of projects within the £1 billion Kickstart funding programme and undertook numerous assessments across the country on behalf of the HCA. More recently, Cushman & Wakefield has analysed funding bids for the HCA-I programme.