The ESP Business Model de-risks development

ESP requires that local authorities, local communities and enabling developers all work together to develop new communities. Everyone in the process needs to make or save money. We think there are a number of legal business models where ESP can be usefully deployed, including Housing Companies JV and developments for Community Land Trusts. ESP can also be incorporated into larger developments. Contact us for if you would like to discuss a business model for your development plans.

Below we summarise the business case for the individuals and organisations in an ESP development.

	Enabling Developer The Enabling Developer profits by reducing his development risk in planning and market, and takes a longer term interest the land value, and in the development of the community which it helps to build, support and maintain.
	Early Adopters Before planning is secured, early adopters are offered discounted options on plots on the basis that they input into the design of the community and new homes. Early adopters effectively sign up as partnering applicants with the enabling developer to apply for planning. Once planning is secured, the early adopters can purchase their plot with all permissions attached at an agreed lower than market price.
	Enabled Self Builders Early adopters convert to enabled self builder status after planning is secured for the whole development. They are joined by more enabled self builders who can either manage their own build or contract local builders to do so on their behalf. They save money by taking a share of developer profit associated with the build stage (which can however be small) but also by controlling the level of completion or fit out of their home. If the pattern books used are flexible and extendable, then the enabled self builder is offered a range of project costs to suit their budgets and phasing requirements.
	Regular Househunter A percentage of plots is reserved and built out by the Enabling Developer as demonstrators and sold on in the usual way to regular househunters. These people might simply arrive in the community late in the process, love the house designs, like the neighbourhood and who perhaps require a less hands on approach.
	Local Authority Housing Officer Local Authority Housing officers also need to remove waste in the process and help get housing built. They still need to agree a percentage of affordable housing within an overall development, and they need to secure the S106 and/or community infrastructure levy charge. But they also need to provide housing in their communities that local people want.  The enabling developer can offer an range of affordability within the development and organise payment of all taxes and charges on a plot by plot basis as the community grows.
	Landowners Landowners agree residual land values with the Enabling Developer based on baseline cost models for traditional speculative development. A shared overage in land values secured after development can also be agreed. This can work whether the land is in public sector ownership or not.
	Mortgage Lenders Mortgage lenders, particularly the Self Build Mortgage industry partner with the Enabling developer to offer packaged solutions to help the homeowner. Homes are built using pattern book designs which are approved by NHBC and subject to continuous improvement from feedback from enabled self builders.
	Local builders Local builders can sign up with the enabling developer to build out new homes in small numbers for enabled self builders. These SMEs can help individual households or a whole street of households. Being local, they can also offer after care and maintenance services.
	Local Authority Development Control Officer Local Authority Development Control officers need maintain construction quality. With the deployment of robust pattern books with tried and tested details for thermal and acoustic performance, their jobs can be made easier and quality can be maintained.
	Local Architects Local Architects work directly with the early adopters and enabling developer to developpattern book designs and urban design codes. The patten book would include context sensitive, appropriately sized house types that the early adopters would want to live in themselves and which are likely to attract others joining the community also. The architects help prepare the planning applications, and then can work with individual households to offer construction management services.
	Enabling Contractor Enabling contractors build the roads, services and infrastructure.
	Building Supply Chain Mass purchasing schemes are set up  by the enabling developer with building supply chains to offer affordable environmentally responsible building products, and also system build housing using modern methods of construction.