european real estate society conference 2014 26 th jun 2014

Search for sustainable land use policy solutions: a regional case of municipalities in financial danger

European Real Estate Society Conference 201426th Jun 2014

Brano Glumac, PhD

/ Department of the Built Environment

Land acquirement by municipalities

• Municipality is an active stakeholder • 1990s Vinex-wijken

• Land investment and land transformation at cities outskirts

• Due to economic conditions land demand declined

• Significant financial losses with remained land surplus

• Financial danger


Characteristics of municipal land supply

LID LNID Other supplyValuation based on: Future land use Current land use Current land use

Administrative status: All planning procedures finished (determined in zoning plan)

Council decision for future development

No council decision

Status of book value:

Activated on municipal balance and financial estimate of land development is at least once a year updated

Activated on municipal balance and process and interest costs are annually added

Not activated

Actions when losses occur: A provision is arranged or amortized directly from book value when losses in land development occur

Amortized directly from book value or transferred to LID when book value is higher than market value

n/a


Sustainable transformation

• Sustainable transformation• brownfield• vacancy• energy upgrade• land readjustment → land book (re)value

→ land use policy → financial gains

• Scale

• Effected stakeholders


Select & Suggest Procedure

• Methodological procedure to select municipalities in financial danger and suggest land policy solution

• Multi-Criteria Decision Analysis (MCDA)• MCDA is a decision-making tool developed for complex

multi-criteria problems that include qualitative and/or quantitative aspects of the problem in the decision-making process

• Fuzzy Delphi Method (FDM)• fuzziness due to human factor in evaluation

Selection Procedure for Municipalities


• MCDA

• 67 Municipalities scanned• Financial data 2011

• 20 Municipalities

• Risks Identified

Municipalities in Financial Danger


• Criteria for Municipality selection:• Land supply per inhabitant• Land supply as share of the total assets• Land supply minus the total reserves• Total land supply



• Risk Indicators (additional Criteria):• book value for different types of land use• square meters of land uses• actual resistance capacity• arranged provisions• taken losses on land developments • cooperation between municipalities


• Overview • 20 Municipalities


Suggestion Procedure for Municipalities


• FDM

• 2 Sustainable Policy Solutions• List of success factors

• 28 Experts• 13 from municipality• 15 consultancy and academia• 60% response rate

• Most applicable policy

Sustainable Policy Solutions


• Actual Policies• monitor the risks more frequently• reprioritizing or cancelling developments• revaluate book value to agricultural land• phasing of land development is stretched• decreasing land prices• coordination of stakeholders (industrial & business)



• Proposed Sustainable Policies solutions:• regional and financial settlement



• Proposed Sustainable Policies solutions:• temporary use / solar panels

• municipality only gains a lease hold for the use of the land

• two times and up to almost seven times more possible revenues than agricultural use

• annual lease hold can be used to cover the annual interest costs



Code PSPS a b c d STDEV Rank

Municipal Experts (A)PSPS_R Regional and financial settlement of residential

developments3.00 6.31 6.31 9.00 6.15 1.44 1

PSPS_T Temporary use of municipal land by the placement of solar panels

1.00 5.62 5.62 10.00 5.56 2.26 2

Academic and Consultancy Experts (B)PSPS_R Regional and financial settlement of residential

developments3.00 6.47 6.47 10.00 6.48 1.91 1


1.00 6.07 6.07 10.00 5.78 2.31 2

All respondents (A+B)PSPS_R Regional and financial settlement of residential

developments3.00 6.39 6.39 10.00 6.45 1.71 1


1.00 5.86 5.86 10.00 5.68 2.28 2

• Comparison by FDM

To Conclude


• Procedure to evaluate municipalities in financial danger

• Assessment of the potential policy interventions

• Improve the awareness of sustainable land use policies in Noord-Brabant region

• Beneficiary/Stakeholders

Thanks!


• [email protected]

Factors Overview / Policy 1


PSPS: Regional and financial settlement of residential developments All respondents (A+B) W = (a,b,c,d)Code Category Factor a b c d STDEV RankR01 Financial Book value 1.00 6.64 6.64 10.00 6.07 2.30 9R02 Financial Compensation for the financial settlement 3.00 7.54 7.54 10.00 7.02 1.73 1R03 Financial Obligation to donate share of revenues for

the financial settlement2.00 7.64 7.64 10.00 6.82 1.65 2

R04 Spatial Bond with current municipality 2.00 7.39 7.39 10.00 6.70 1.79 3R05 Spatial Competitiveness in region 2.00 6.82 6.82 10.00 6.41 2.03 6R06 Spatial Sort of residential developments in a

region3.00 6.71 6.71 10.00 6.61 1.66 4

R07 Administrative Role of the province 1.00 6.79 6.79 10.00 6.14 2.31 8R08 Administrative Politics 1.00 7.64 7.64 10.00 6.57 1.64 5R09 Administrative Certainty 1.00 7.32 7.32 10.00 6.41 2.07 6

Factors Overview / Policy 2


PSPS: Temporary use of municipal land by the placement of solar panels All respondents (A+B) W = (a,b,c,d)Code Category Factor a b c d STDEV RankT01 Financial Participation of energy cooperative 1.00 6.75 6.75 10.00 6.13 2.65 4T02 Financial Financial feasibility 1.00 6.93 6.93 10.00 6.21 2.65 3T03 Financial Run-time period 1.00 7.36 7.36 10.00 6.43 2.26 1T04 Spatial Scale of solar park 1.00 6.57 6.57 10.00 6.04 2.12 6T05 Spatial Location 1.00 6.75 6.75 10.00 6.13 2.53 5T06 Administrative Ambitions in the field of sustainability 1.00 5.96 5.96 10.00 5.73 2.43 8T07 Administrative Legislation regarding collectively net

metering1.00 7.25 7.25 10.00 6.38 2.70 2

T08 Administrative Flexibility of zoning plan 1.00 5.21 5.21 10.00 5.36 2.68 9T09 Administrative Administrative support 1.00 6.61 6.61 10.00 6.05 2.51 6

european real estate society conference 2014 26 th jun 2014

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