Understanding Land Development: A Project-Based Approach

Preface and acknowledgements

I hear and I forget. I see and I remember. I do and I understand. (Confucius)

This book is born of an interest in preparing astute, resilient planners for the realities of planning practice and for the challenges of making a better world. There is more that I would have liked to have put in this book and perhaps there will be later opportunities to expand on this volume.

Behind it is the hidden hand of what I have learned from others who have taught me, particularly Chris Cunningham and Tony Sorensen at the University of New England. There are also the guest speakers and teachers in my classes, including Mark Edwards, Garry Maclean, Brendan Best (for insights into development finance), and Rebecca Kalianiotis. Thank you to Martin Zaltron and Michael Nash for advice on communications infrastructure and development timing. Thank you to all the students in my classes and to the assistants over the years: Natalie Osborne (who also provided feedback on the draft), Nikki Larder, Amanda Clarke, Dean Butcher, Jacob Sickinger, Stephen Thompson, Ian Knight, Jo Symes and Pazit Taygfeld. Thanks to Neil Sipe and Lex Brown for your support and project suggestions, and to Maryam Shobeirinejad for help with illustrations.

A big thank you to Ted Hamilton and CSIRO Publishing for this opportunity. I was delighted to get the acceptance letter, which for me affirmed a belief, from an unexpected and respected source, in this unusual work.

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Introduction

Learning is a journey, not a destination. (anon)

Purpose of this book

You can learn something from reading this book. It explains how development happens, in theory.

But that’s not the point of this book. I believe you can learn a lot more – and even develop your own ideas – from using it the way it was meant to be used: as a guide to doing a studio project on land development. It then becomes a vehicle that takes you on a journey where – as you travel through the project – the complex set of macro- and micro-scale forces that shape cities unfold before you. This journey enables you to unveil, see and understand how development happens.

The book’s approach to learning is a dance between deduction and induction. It is deductive in the sense that you apply the theory in this book to the particular case study project that you are working on. It is inductive in that you will develop new insights and ideas (theory) from the particular case study project that you undertake.

The book emerges from the conjunction of two streams of research and scholarship. One is my research focus on how planning can work in a real-world context of market-led development and private property. This has led me to study land development and its implications for, and its responses to, urban and regional planning (and vice versa). The other stream concerns how to educate and prepare planners for the harsh realities of real-world planning practice. This has led me to experiential learning and to practice-informed, holistic and whole-of-person teaching approaches. The book’s aim is to provide the kinds of understanding of development that planners need, and it is written for planning students and their teachers.

Development can mean many things, but in this book the focus is on land development for profit where development:

is the process of carrying out works involving a change in the physical use or in the intensity of an existing use of land or buildings. Development may be a lengthy process from the original conception to change the existing use, to survey, design, estimates, preliminary discussion with various public bodies, land acquisitions, to the formal application for planning consent. (Balchin et al. 1995, p. 126)

Understanding development is important for planners because development and planning are inextricably intertwined:

Planning and urban policy have a great deal to do with private sector development – with the regulation and assessment of development, the redistribution of its social costs and private benefits, the provision of infrastructure for development, and with the mediation of conflict over development. Furthermore, planners and other policy makers … play but one role in urban development processes. Planners do not build cities and towns. Rather, they are built by private sector interests, developers in particular. In order to shape urban development, planners have to influence the action of the players who actually build cities. This requires a sound understanding of the perspectives, actions and strategies of those builders. (Coiacetto 2000a, p. 120)

The notion that planners need to understand development is not universally accepted in planning education. Perhaps it is thought there is little to know, that somehow development is a subject not worthy of analysis, even that it’s an undesirable activity. Whether it is desirable or not is relatively immaterial because, like it or not, developers build cities: the private development industry provides the housing, industrial sites, retail centres and offices that our lives and economy depend upon. Therefore, the notion that planners need not understand development in order to shape a better future for our citizens is as odd as thinking that medical doctors need not study human anatomy to know how to cure the sick and to heal the injured.

The premise of this book is that development is best taught in a practical manner. The method proposed here is to teach it in a project-based studio mode, in other words through learning-by-doing. In brief, a site or a place is chosen for a studio project. Students respond to a fictitious or real client brief that calls for tenders to undertake a development feasibility study for the site. To achieve this goal, students work through three stages, comprising a preliminary proposal, a design and, finally, a complete report with a fully financially appraised proposal. This approach offers opportunities for fascinating and diverse projects.

The book draws upon several different topics and integrates them into a single volume focusing on land development: planning; development control; development funding; urban design; master planning; engineering; development finance; urban economics; and market research. The book is a starting point – think of it as a map – and to execute your specific project and research you will need access to further resources and literature that provide detail on some of these topics.

The target and emphasis of this book differs from others. There are some US books about development but this book is for Australia, where the context and legal framework and market are different. Moreover, this book is written for and targeted to students of planning, of urban policy, and of the built environment, not to potential developers (though they may find it useful too).

The pedagogical approach is also different (Chapter 2; Coiacetto 2008). Its proposed analysis of development utilises a project-based approach: learning-by-doing. Studio manuals are rare for any planning course, and I have yet to encounter one about development. Because it is project-based, the book should continue to open windows into the world of development for years to come.

The book is not normative: it is not a subjective statement of how urban development or urban design should be done (Chapter 2). Rather, it is analytical, designed to help you discover and understand how and why development actually happens. This allows you to discover and understand why real-world urban development differs from planning’s normative ideals so that you can start thinking about how you might be able to influence this real world.

Why a project-based studio approach?

Project-based studios are, first of all, a different, exciting, real-world way to teach and to learn. Each project ventures into uncharted territory that delivers a different set of complicated, messy, real-world problems and challenges, to which there can be several solutions. These cannot be fully anticipated before the project starts. As a result, teaching must be, to a large degree, demand and process driven, and responsive to the situation: the teacher works with the student to analyse and solve the problems and to come up with workable solutions. Though there can be no fully comprehensive book that covers every set of issues and questions that may arise in a project, this book provides a broad framework to guide you through the project and the broad theory needed to help you think through the issues that emerge.

The second reason is that studio learning is ideally suited to learning about land development. Studios provide a hands-on approach to something that cannot be taught effectively through the delivery of theory alone, or even by working on hypothetical situations. Development is a complex and variable process where seemingly insignificant details can affect the outcome of a project. No two projects are alike: each presents a unique set of problems and challenges, partly because each location is unique. This is demonstrated in the different projects that my students have undertaken over the years, described in Chapter 2. Even if the same site were selected on two different occasions, the challenges and outcomes would be different because the factors that can mean success or failure for a development – small details sometimes – change over time. These include changes in the market, in lending interest rates for developers, in interest rates for buyers of the development products, in the tax laws, in the local planning schemes and planning policy, in building costs, and in the ownership of the land. Changes in the environment, such as more traffic on the surrounding roads or a new local shopping centre, will change not only the site’s development value, but also the landowner’s price expectations. Alternatively, if nothing happens in the area, that might tell buyers of the potential development products and potential lenders to the developer that this is a bad area to invest in.

From this we can conclude that a special kind of learning happens in a project-based approach. What does one learn in studios generally and, in particular, by using the studio-based approach to understanding development, as prescribed in this book? The short answer is that one can learn a lot and at a variety of levels, from generic skills and planning skills to deeper insights into the complex set of forces that give shape to places. Chapter 2 pursues this idea further. Do not skip over it or leave it to the end of the project. Read it before you start the project and return to it occasionally. Keep notes on what you are learning, because the idea is that you will learn more from doing your project than from reading the book.

What the project involves

This book proposes that you carry out a development feasibility study in four steps – three of them preferably in student teams – that build on each other, culminating in a final, stand-alone report (Figure 1.1).

Although the steps are sequential, try to think ahead. Think about all the steps from day one by preparing a file or folder for each of the steps and gathering material, ideas, newspaper clippings and so on into these folders. Being organised makes your task easier.

The steps are:

Respond to the brief provided. You or, more correctly, your team, will write a competitive tender to undertake a consulting job for a client who wants a development feasibility study, in three stages, for a site or area. The brief is a document that describes the consulting job the client wants done (Chapter 3). The teacher will need to provide the brief, and an example is provided as Appendix 1.

Carry out Stage 1 of the consulting project as set out in the brief and in your Response to the Brief. Your team will act as if it has actually won the tender. This means that you will have to do some research and come up with a convincing proposal on how to develop the site or area in question (Chapter 4).

Carry out Stage 2 of the consulting project. You will prepare a physical layout and design of the development that you or your team proposed in Stage 1 (Chapter 5).

Carry out Stage 3 of the consulting project. This is the final report. Your team will revise and bring together all the work from the previous two stages as well as a fully costed financial appraisal of the proposed development. Through an involved and detailed process your team will estimate how long this development will take, the most that should be paid for the land and what rate of profit or loss the development is projected to make given certain assumptions, and it will advise the client on whether to proceed with the proposed development project (Chapter 6).

As stated, the various stages in this project together build towards the final report (Stage 3; see Figure 1.1). This gives you a chance to revise, develop and improve your previous work to a professional standard. Teachers are recommended to include, if feasible, a short oral presentation to the ‘client’ and class shortly before the reports for stages 1 and 3 are delivered. This mimics real-world practice, where consultants give oral summaries of their findings to the client or its board of directors for feedback and discussion before submitting the written report. It also gives you an opportunity to make any final adjustments to your reports.

Finding and choosing projects

A