NATIONAL PERSPECTIVES

Transcription

1 Presentation Overview CONTEMPORARY STOCK TRANSFER Insights from the front line Dr Tony Gilmour AHI seminar, Adelaide, 13 October 2014 Australasian perspectives: policy vs. practice by jurisdiction Transfers in practice: how are deals structured, and what actually happens? Sector implications: outlook for tenants, housing providers and governments Context Focus on management outsourcing transactions, 2012 onwards Follows-on from Hal s AHURI report and earlier presentation A practical and independent presentation, based on lived-experience as a consultant Early analysis - we re still in the middle of the revolution! NATIONAL PERSPECTIVES What is happening in each jurisdiction, and are all transfers the same? Policy production line Jurisdiction summary Western Australia: 1/2010: Opening doors New Zealand: 8/2010 Vision for social housing Tasmania: 2012 Better housing futures Queensland: 7/2013 Housing road map promised 11/2013 South Australia: 10/2013 Building a stronger SA Victoria: 3/2014 New directions And jurisdictions missing in action! Status Type Tas. Completed Precinct based, state-wide goal (35%) Qld. In progress Region based, state-wide goal (90%) SA In progress Precinct based, state-wide goal (27%) NZ Promised 2015 Precinct based, national goal (20%) Vic. Promised Precinct based, state-wide? WA Potential Unknown NSW Potential Precinct based? ACT Considering Precinct based? NT Unlikely Needs an ALMO? housinginstitute.org 1

2 Differing trajectories Diverse policy drivers 20% 15% 10% 5% 0% Source: Productivity Commission (2014), data at June NSW Vic Qld WA SA Tas ACT NT Aust Reports on social housing failure Lure of national funding (CRA, IRRS) Other drivers: Maintenance backlog (all, especially Tas.) Estate renewal (NSW, Tas., SA) Neighbourhood cohesion (Tas.) place making (SA) Reducing size of public sector (Qld., arguably NZ) Sector capacity building (SA) New affordable housing (Qld.) Outsourcing contrasted What to spend CRA/IRRS/leverage funds on Encourage local, national or international providers Small scale or large scale (consortium) Shorter term (trial) or longer term contract Area or precinct transfer? Assets and staff transfer - yes or no? Asset transfer or asset sale? Forced tenant transfers, or not No standard model for management outsourcing: read the small print carefully! Bid architecture TRANSFERS IN PRACTICE What is the bidding process like? Insights from the front line Who can bid? Partly open tender - particular jurisdiction or Tier More open tender - any national or international organisation Staging One stage process - RFP (e.g. Tas.) Two stage process - EOI, RFP with extra info Multiple stages (e.g. Logan) Conformity with brief s rules Conforming bids only, or not housinginstitute.org 2

3 Action stations! Potential team members Two typical approaches by providers: Pre-planning and capacity building (rare) Headless chooks! (common) Seldom a clear business case Speed dating In search of consultants, financial modelers etc. Courtship with consortium partners Defensive courtship Changing teams Community housing providers (1 or more) Property developer or project manager Asset management company Welfare support agency, big or small Debt and/or equity investors Urban planners and Architects University - longitudinal research, SROI etc. Team structures The lived bid experience Basic delivery structure design Formal consortium, establish new company Non entity joint venture Involving larger housing providers Consortium 50/50 share Consortium minority shareholding (e.g. Centacare) Sub-contract part of service delivery Fee for service advice and capacity support Core team members will work long days, weekends and endure sleepless nights EOI and RFP documents are graphically rich, branded tomes - 45,000 words, 250 pages? External direct costs up to $100,000, with far higher opportunity cost Expect the unexpected: disappearing consortium members, changing rules from Government, fractious Boards and unknown unknowns Tenants 1 SECTOR IMPLICATIONS Outlooks for tenants, housing providers and governments No direct role (voting), but sometimes indirect role in deciding winning bid Engagement process - expectations raised, and handover often a problem Competition is leading to innovation in tenant participation by housing providers Probably more tenant participation than if no transfer takes place housinginstitute.org 3

4 Tenants 2 Staff No State has yet announced it has cracked forced transfers, though often considered Post transfer, tenants will be wooed to transfer to community housing Incentives offered Tenants involved around transfer time, but not clear they will be in the longer term Rarely consulted Normally not transferred, so job losses Employment cost differential between public and community sectors Potential loss of corporate knowledge, and need to up-skill new staff Issues of culture change Service providers Governments General problem of lack of capacity Slow learning as each deal a one-off Asset management companies: Lake Maintenance, Spotless, Transfield Services Financiers: National Affordable Housing Consortium, Questus Consultancies: fragmented, mainly local knowledge and siloed skill-set Only modest knowledge sharing between jurisdictions Capacity issue a problem, with only one or two transfers possible at once Not clear how or if Government will move to a more strategic steering of sector Government may still remain hands-on due to KPI monitoring Housing providers 1 Housing providers 2 Capacity is an issue for all providers, except for moderate scale transfers Rush to improve management teams, IT systems, procedures and alliances Transfers have ability to increase scale and cashflows, though a risky business New hierarchy of housing providers Top participants: Compass Housing, NSW, Qld. Community Housing Limited, national MA Housing, NSW, Vic., Tas. Housing Choices Australia, Vic., Tas. Centacare and Evolve Housing, Tas., NSW Horizon Housing, Qld. (in waiting) SA anonymous winners (in waiting) A new super league? housinginstitute.org 4

5 Super league 2014 The future: 5 predictions 9,000 5,500 4,300 3,200 Transfers have now passed the tipping point and will continue, slowly/steadily Expect innovations around new transfer models, especially stock sales and ALMOs State and national boundaries will dissolve, at least for the super league providers Social housing funding will change radically One transfer will fail within the next 5 years, and need to be rescued by Government Housing Action Network 19 Associates supporting social housing providers in Australia and New Zealand tony@housingaction.net.au housinginstitute.org 5