PROPERTY JOURNAL

Public-private partnerships for asset management

Consolidation of real-estate assets by Place Partnership is helping public and private organisations alike reduce costs and increase efficiency

Author: Andrew Pollard

01 October 2019

Place Partnership was formed in 2015 by six forward-thinking local authorities as a unique public-sector mutual to help rationalise their land and property assets and create value for the estate. From the outset, we have recognised the need for efficiency while at the same time improving services through a more strategic approach.

With Cabinet Office support, Place Partnership evolved from the government's One Public Estate programme to make savings from effective asset management. In practical terms, this is often realised by the development of public-sector hubs – such as the Wyre Forest facility currently under construction – that bring together several authorities and services and promote time- and cost-saving initiatives such as agile working. This is supported by rationalisation and improvement of existing procurement processes, which can enable further significant savings as well as improved efficiencies through greater economies of scale.

This programme, now in its seventh phase, has so far saved taxpayers £24m in running costs, created 5,745 jobs and released land for 3,336 homes. Ultimately, this phase includes plans for public-sector land to be developed, creating 10,000 homes and 14,000 jobs while saving taxpayers £37m in running costs.

Although Place Partnership's beginnings were in the public sector, the company has since its launch developed its client base, returning the benefits of its commercial activity to its public-sector shareholders. Our portfolio under management comprises some £850m of assets of all kinds, while our regional service provision employs around 170 staff, including chartered surveyors, registered valuers and land and estate managers. This team has significant experience in the nuances of commercial, industrial, residential, agricultural and educational real estate, working across the service lines that underpin our business: strategic asset management, valuation, project management and facilities management.

We know the importance that real-estate assets play in service provision and the ways in which we can ensure greater efficiencies and savings for our customers and shareholders. A core element of our original brief was to save £58m between 2015 and 2025, and we are already well ahead of target, having reduced estate operating costs by £13m in addition to capital receipts realised.

Place Partnership is an end-to-end provider, uniquely offering the full suite of property services for customers and partners alike. This means that colleagues working in one team have ready access to the information from other disciplines. For instance, our asset management team can call on the expertise from colleagues in facilities management to provide fast, accurate and reliable information, gaining an holistic understanding of a building's strengths and potential for improvement.

"This programme has so far saved taxpayers £24m in running costs created 5745 jobs and released land for 3336 homes"

Strategic asset management is the key strand of our service offering because it draws on data from other areas of the business, such as energy management and facilities management, to inform an overall strategy brief. In asset management, we provide a range of functions including investment analysis and strategy, re-gearing of leases, town and county planning, acquisitions and disposals, asset data management, and development consultancy.

A good example of our work in this area includes the portfolio review we undertook for the Worcestershire Health and Care NHS Trust. At the time, it occupied a large number of properties on a leasehold basis but was seeking to streamline the operation, and it enlisted Place Partnership. Our team investigated lease documentation to assess the liabilities and costs associated with each building, taking into account location, ease of access, running costs, space requirements, working environments, and state of repair. This enabled our asset management team to identify opportunities for rationalising the portfolio and reducing costs by streamlining services, vacating some premises and transferring to existing accommodation in other public-sector offices.

Our work also enables us to show ongoing social value for our clients by using local suppliers and procurement channels, benefiting local economies. This is at the same time as reducing the total number of contracts from around 550 to 150 while preserving the benefits of regional service provision and giving a uniform service to all customers and partners.

A step in this direction is our recent agreement with facilities management firm Graham to act as our single-point service provider for hard facilities management services. This partnership will ensure substantial savings in both time and resource, streamlining service provision that is quality-assured. Graham hopes to add £7m per annum of social value as a result, which will be assessed through the government's Social Profit Calculator.

Looking back at our first four years, it has become increasingly clear that the lines of demarcation between disciplines must be broken down if users are to unlock the full value of their assets. Only by working in a collaborative way across functions will we achieve the gains that forward-thinking clients are seeking, whether in the public sector or in the commercial world.

In this respect we value the initiatives supported by RICS in raising the profile of facilities management in business, which we regard as not only an important driver of change but of workplace strategy. Looking to the future we aim to grow our partnership, and hope to inspire others to adopt collaborative ways of working for the benefit of the organisations that seek our expertise.

andrew.pollard@placepartnership.co.uk @Place_Part

Related competencies include: Asset management Strategic real estate consultancy

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