Britain’s railways are enjoying a renaissance and new stations are opening across the UK as we wake up to the social, economic and environmental benefits of rail says John McGregor, Director of E-Rail, a company that is leading an innovative approach to funding transport initiatives that could see more projects take off in the North East of England.
But there’s a catch: despite the benefits, if you want a new station, the government will only provide 75% of funding. The other 25% is down to you. That’s where E-Rail can help with its innovative approach to Land Value Capture (LVC).
New stations create a hub commercial and housing development, which means substantial increases in the value of existing agricultural, brown or amenity land – and premiums on completed buildings of up to 20%.
Our experience has taught us that this is a tempting prospect for landowners and developers, whilst helping local authorities and transport bodies fulfil their own obligations and targets.
E-Rail is the UK’s expert in Land Value Capture for new rail stations projects – its recent success helping to fund the Northumberland Line speaks for itself.
Looking specifically at benefits there are those that relate to local authorities and transport bodies and those that relate to landowners and developers.
Experience shows that developments start sooner, sales are completed faster and price levels are higher, as building work on the new station is accelerated by the guaranteed funding. LVC can secure the 25% funding requirement for new stations, which ensures projects can go ahead faster – or at all.
For the former they include:
- Undeveloped land near to proposed stations becomes more attractive.
- Greener, safer travel objectives met through reduced car use.
- Commercial and housing developments create vibrant communities and help achieve increased housing targets.
- The potential funds created through LVC can far exceed s106 and Community Infrastructure levies, whilst ensuring non-transport s106 funding remains intact.
- The process encourages long term partnership and collaboration with developers and landowners.
For the latter they include:
- LVC agreements can bring a degree of certainty to planning applications and be more valuable than the landowner might expect.
- Experience shows that developments start sooner, sales are completed faster and price levels are higher, as building work on the new station is accelerated by the guaranteed funding.
- LVC can secure the 25% funding requirement for new stations, which ensures projects can go ahead faster – or at all.
This article was featured in CompProp NEE April 2022.
