Social value roadmap for real estate

Key Points

• Research suggests that maximising social value could lead to a 5% uplift in the market value of a real estate asset.
• New policies and instruments can be designed and implemented to incentivise all actors to lead in social value and integrate it into decision-making.

RECOMMENDATIONS

• Central government and industry could partner to develop a social value kitemark for the real estate sector to provide a high-level, easy-to-understand seal of assurance on the embedding of social value.
• A “social taxonomy” could be developed alongside new Sustainability Disclosure Requirements, paralleling the Government’s planned “green taxonomy”.
• Use existing provisions in the planning system, such as local plans and S106 agreements, to maximise and contractualise social value
• Use the planned new Infrastructure Levy to hold developers to account on social value pledges and address the chronic under-funding of local planning teams.
• The real estate industry could be encouraged to consider social co-benefits of carbon offsetting activity, developing frameworks for ensuring that social impact is given appropriate consideration in decision-making
• Central government in partnership with the Local Government Association could develop guidance for local government carbon offset funds, focused on evaluation and consideration of social benefits within funds.
• Boost capacity in local planning teams. Research suggests a virtuous cycle of extracting additional developer contributions where planning teams are properly resourced. Helicopter models and secondments could be used to help local authorities develop expertise in social value.
• Post-occupancy evaluations (POEs), with a focus on social value outcomes, could become a standard element of design, development and planning in real estate. POEs need to be conducted more frequently to capture the long-term social value outcomes.
• Site social value handbooks could be created as standard for all large-scale developments and passed down to new site owners, detailing social value commitments and used as a means for councils and residents to hold developers to account on social value pledges.