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RIAI President David Browne addresses the RIAI Annual Conference

Published: Monday, October 08, 2018

RIAI CONFERENCE
PRESIDENT’S OPENING SPEECH – DAY 1
FRIDAY 5 OCTOBER 2018

WELCOME AND INTRODUCTION

Minister, distinguished guests, colleagues, welcome to the 2018 RIAI Annual Conference. This conference takes place at a time in Ireland, where there is a mixture of good and bad impacting our sector.
On the one hand, the economy is in a very positive state with construction output expected to reach €20.1 billion in 2018, approximately 7.6% of Ireland’s GNP, still below the European norm of 10% to 12%. It appears that the uplift which hit Dublin in 2015 is finally spreading to all areas. On the other hand, we have a series of significant difficult issues, our housing deficit and homelessness, availability of human resources and high construction inflation.

 

HOUSING

I would like to concentrate today on housing. We are not alone in Ireland with this predicament. This week’s Architectural Record, probably the most prominent architectural magazine in the United States has the headline

“Finding an affordable place to live is becoming an increasingly dire problem for many Americans—from the growing homeless population to middleclass families” 

I have been talking with various development sector leaders here about this. In brief, the collective consensus is that there are three key issues to be addressed to unlock the housing shortage, Delivery, Supply and Affordability.

 

DELIVERY

We should achieve 18,500 completions this year and 23,000 next year. As a measurement of delivery capacity, in 2006 there were about 247,000 people in the construction industry, 64% of which worked in housing, so about 158,000 people delivered about 88,000 units in a year (about 3,300 hours/unit). Achieving this level again is unlikely and neither desirable nor feasible.Today, of a construction workforce of 137,000, about 30% are in housing so about 41,000 people delivered about 18,500 units in a year (about 4,000 hours/unit).It is anticipated that, as commercial development lessens, more construction industry operatives will migrate into housing, which will greatly help delivery capacity. Combined with natural sector labour growth, this capacity could double the current capability to deliver houses. Present projections for housing completions assuming no changes in productivity are estimated at:-

35,000   Mid 2022   
50,000   End 2025  

With the swing of operatives from commercial to housing, these figures should be significantly improved provided:-
      Anticipated swing of construction operatives from commercial to housing from about 30% to  about 60% happens.

      No major disruption to that swing caused by greater than expected increased commercial,  industrial, institutional or            infrastructure construction.

      Current natural growth of over 1,000 construction operatives per month into the industry  continues.

 

SUPPLY

Some in the development sector are suggesting that there is a lack of affordable zoned and serviced land to deliver the country’s housing needs citing the cause of this on an unwillingness of  landowners to sell their lands.
They also suggest that a rapid increase in zoned land prices has occurred due well-funded entities paying very high prices. They say such land then has to be held from development as it is not financially feasible for these entities to build affordable homes.
In the shorter term, supply does not appear to be of major significance from information the RIAI is receiving. A recent survey of the five largest architectural practices specialising in housing indicated that they had over 75,000 residential units in their pipeline from inception through construction and this pipeline is getting bigger.

Some steps to address potential shortages may be required in the medium to long term and suggestions from the industry include:-
      General support for a tax on underdeveloped zoned land to be put in place sooner rather than later.

      Consider introducing targeted incentivisation for housing development and the upgrading of older buildings based on directly supporting the house purchaser, possibly with government taking partial equity in the house or apartment This support        could either be bought off in the long term or paid back upon sale. Such targeted incentivisation, in a different form, was highly successful in driving urban regeneration in the 1980s and 1990s.

      Guidelines for the interpretation of planning, conservation and compliance of the upgrading of older buildings in our villages, towns and cities with building regulations, given their age and construction are needed. It is hoped that the forthcoming        Bringing Back Homes Manual for the Reuse of Existing Buildings and the recently established Vacant Homes Unit will provide this guidance. Combined with incentivisation, achieving effective scale in bringing vacant buildings back to life could          be a gamechanger for the much needed revitalisation of our urban areas.

 

AFFORDABILITY

Affordability is probably the biggest challenge to addressing the housing deficit at the moment. Many house builders are saying that they have trouble selling houses due to the difficulty facing prospective purchasers in obtaining finance.

A significant contributor to this is the high cumulative government take on every new dwelling that comes to market.

At present, the unfortunate reality is that approximately 30% of the cost of each and every home delivered to the Irish market goes to central and local government with the purchaser paying for the social housing subsidy, the VAT and the development contribution as the developer has to pass on these costs. So, young couples and young people who want to buy a home are finding it very hard to get on the property ladder.

Further, because the purchase price is out of reach, many have to rent, competing for a limited stock of accommodation. Consequently, average rents have now been driven higher than an equivalent mortgage. This means that young people cannot now afford to both rent and save for the deposit to buy a new house. This is a downward spiral that has to be addressed.

Currently, Ireland has 13.5% VAT on new houses when our neighbours in Northern Ireland and Great Britain pay 0%.

Is it right for new house purchasers to be, effectively, subsidising social housing? Up until the 1980s the state did an excellent job in developing social housing at scale. The numbers of houses built annually by the public sector up until then was substantial. For instance, in one year in 1975 the state delivered 8,800 homes, enough to house virtually all our current homeless families.  I wonder why the state has been so reluctant to take on this role again.

On the demand side, the Central Bank’s house lending rules have undoubtedly been successful in dampening the rise in house prices in the Dublin region, though less so in the rest of the country. While this is welcome, the unintended consequence appears to have been to exclude a large cohort of buyers from entering the market. The targeted incentivisation I have already mentioned might go quite some way to dealing with this issue.
       I believe that there is a strong case for supporting purchasers through significantly reducing the government take on new house purchases. This could be partially achieved by reducing VAT on new homes up to €350,000 from 13.5% to 0%, as         is the case with our neighbours in the UK and Northern Ireland.
       For renters, we might take inspiration from new thinking in the US to address such an enormous national problem. Two recent proposals for housing relief would provide tax rebates to those paying more than 30 percent of their income on rent.

 

LAND DEVELOPMENT AGENCY

Within the development sector, there is strong general support for the new Land Development Agency. It is seen as an excellent and possibly game changing initiative. If this agency can come up with appropriate procurement systems, it should have great potential to deliver social and affordable housing at scale. We think this will probably require some form of discounting of land costs and, possibly, development charges.

Our members see first-hand the challenges in getting housing projects from concept to completion. Research undertaken by the RIAI late last year showed that, despite the huge demand for new houses and apartments, a range of structural and administrative issues means that it still takes upwards of 3.5 years for new homes to become available to purchase or rent. 

Will the new Land Development Agency reduce this time-frame and ensure that both the pipeline of new housing developments, particularly for social and affordable housing, grows and lead-times are reduced?
This year, the last sites in the Dublin Docklands are being sold. This area has been a huge asset to Dublin and Ireland since the late 1980s catering for the needs of large scale global and indigenous companies, which contribute in no small way to our economy. It has given Ireland enormous competitive advantage in competing for FDI. It has also delivered a large amount of sustainable urban housing development. How is the country going to replace that asset? Where does Dublin go next in housing its share of the 1m additional people that will live on this Island by 2040 in an economically and environmentally sustainable way?

At some stage, the Port of Dublin will have to move. The relocation the port is a golden opportunity to create a modern high density city within the city. If this is to occur, it is of great importance to start the relocation process now if relocation is to be completed by 2050. This is also a golden opportunity for the LDA to start making a real difference at scale. If we choose not to use the port for the sustainable growth of Dublin, we need a really viable alternative – where will this be?

The LDA initiative is welcomed by the majority in the development sector and we believe that it should be deployed as rapidly as possible.

 

QUALITY, LEADERSHIP, INNOVATION, CREATIVITY

Architects are in a strong and natural position to lead in the delivery of our housing needs. As I have already mentioned, the five largest housing practices have 75,000 units underway and more on the horizon.

But, and this is of critical importance, neither the government nor the development sector can lose sight of the crucial need to put quality at the forefront of what we are doing. Our efforts will be ultimately futile and unsustainable if we do not:-
       Build housing that people want to live in because it is good.

       Build housing that is durable and future proofed.

       Create decent public realm in which people can work, live and play, and build this around working public infrastructure and transport oriented development principles.


To achieve this, architects need good briefs from public and private sector clients. Quality briefs achieve quality outcomes and the processes employed to deliver housing through planning and procurement must have quality alongside cost and speed as a key goal.


Government procurement badly needs to be redesigned to achieve better quality and faster outcomes to ensure that public funds are being used correctly, transparently and efficiently. The RIAI is currently working on a Smart Procurement paper to present to government with a view to assisting in addressing this issue.

Architects are driving change, innovation and new thinking to deliver the right housing solutions to meet society’s needs now. This ranges through the core design skills in creative analysis, thinking and communication at the heart of the building design and construction process, through engagement with industry to develop offsite and other systems that can deliver more speedily and through engaging with new tools like BIM to streamline processes.

 

HOUSING CONCLUSION

The industry consensus is that the housing shortage needs to be addressed at scale now as we cannot wait a further 3 to 5 years, taking account of population growth, pent up demand and the critical need for Ireland to remain a competitive location for FDI. If supply and delivery can accelerate ahead to achieve 50,000 completions by 2025, as I have mentioned, that will be good progress, but we should be doing better.

 

DESIGNING HOMES FOR AN AGEING POPULATION

Today the RIAI launches its recently completed research on Designing Homes for an Ageing Population. The purpose of this research is to assess the types and locations of housing demanded for Ireland’s ageing population. It discusses Ireland’s demographic profile and builds on work by the Housing Agency on housing Ireland’s ageing population discussing how good planning and design can ensure housing delivery and place-making to meet the needs of a large and growing cohort of older people. I recommend that everyone obtains a copy from the conference bookstore

 

CONFERENCE SPEAKERS

I welcome all of our conference speakers and thank them very much for participating. I know that all of them will have enlightening things to say on the themes for this conference, Leadership, Innovation and Creativity. Our first speaker is architect Michael Maltzan who will present new design solutions for housing homeless communities, an issue of great interest to us here in Ireland.

 

CONCLUSION

I would like to particularly thank Minister Murphy for attending our conference. His participation is very much welcomed and appreciated. Minister Murphy has been dealing with one of our society’s most urgent and difficult issues and I know we all commend the work and effort he has put in and wish him all success in taking the right steps to achieving a balanced housing supply for the country. The Minister would now like to give you his address,

 

 

RIAI CONFERENCE
PRESIDENT’S OPENING SPEECH – DAY 2
SATURDAY 6 OCTOBER 2018

WELCOME

Distinguished guests, colleagues, welcome to Day 2 of the 2018 RIAI Annual Conference. I had originally wanted to speak about this year’s conference theme at yesterday’s opening but felt it more appropriate to address the housing issue with Minister Murphy present. So today I will speak briefly about the theme.

This year’s theme is Leadership, Innovation and Creativity. Why? Because I believe that these three characteristics deliver real value to our clients and society and I believe that we need to be seen, in our practices and as an institute, to embody and deliver on these qualities. Our conference speakers have given a lot of thought to Leadership, Innovation and Creativity and I am sure all of us have been gaining valuable insights from their presentations yesterday and today.


We have not been good at articulating the value of how we work and the work we produce. This has led to increasing marginalisation of the profession in the building process as competing service providers – programme managers, construction managers, project managers – push the architect further from the client and delay our input to later and later in the development process. They are hardly more skilled than us but they have done two critical things – convinced the client of their value and convinced clients of architects’ lower value and we have allowed this to happen.
What do I mean by leadership, innovation and creativity and how we should embody these attributes?

 

CREATIVITY

Creativity is the cornerstone of architecture. Architect, Adrian Dobson, who is Director of Practice at the RIBA, put the value of architects’ creativity succinctly.
          “In the end, it is the core design skills in analysis, thinking and communication that are at the heart of what the architect uniquely brings to the building design and construction process. The game cannot really commence in earnest until the               architect has joined the table and thrown a six ………….there is no doubt that true value is created on the sketch pad and on the drawing board or screen.”


The value of architect’s creativity has also been very well expressed by UK client, Isabel Allen, Design Champion at HAB Housing, a sustainable housing developer. She put it this way:-
         “Brilliant architects …… don’t just save money, they make value. They turn something potentially humdrum and pedestrian into something valuable and special. You can try to put a value on this …...the right project – and the right architect –              are worth their weight in gold. 

           We rely on architects to take a big messy clump of issues – site constraints, cost constraints,  technical issues, conflicting agendas etc and to somehow turn them into something  functional, elegant, beautiful and timeless. Good, poetic,                     intelligent design is the most  efficient way of ensuring best value for money.”


We need to remember that we create the vision for any project and vision matters for buildings of all scales in all sectors. Adrian Dobson again has also said “The vision is the unbreakable thread that guides the project from concept to completion and hopefully beyond”. Clients do trust in those who can deliver a vision and, in my experience, they are more than keen to see architects step forward to lead the vision.
To deliver any vision, architects need to be business savvy and demonstrate awareness of how to deliver value. On the one hand we need to improve our communication skills to convey that value consistently. On the other we need to improve our business skills developing a working understanding of development economics, finance and management and most importantly listening so that we fully understand our clients’ needs. To achieve this, we must enhance training and development in these areas. We should also look at working more collaboratively, sharing professional knowledge through targeted research. And the RIAI has started on the route to help develop these skills.

 

INNOVATION

We architects are good at innovation. The RIAI wants to strongly encourage innovation to support the leadership of architects through innovation. To this end, we are pursuing a number of initiatives.
         We are starting a process to engage more closely with the schools of architecture with a view to have practising architects inputting more into student education and providing a meaningful internship programme seeking improved outcomes             at  degree stage.

         Initiating an ongoing programme of research to be commissioned by practices, seeking financial support from the Irish Research Council. This research will be shared throughout the profession. It is hoped that this will lead to a significant                   body of evidence-based research to support practice over the medium to long term.

         Encouraging practices to undertake post occupancy evaluation of completed buildings. At the moment, architects have remarkably little knowledge of this kind. The work we carry out has real consequences for people and we need to know              what these are and take responsibility for them. This work has the potential to increase client’s trust and confidence in what we do and enhance our leadership in the development sector.


I believe that the more versatility we show in our thinking about the true needs of our clients and the public and about innovative ways to address those needs, the more competitive our offer will be and the greater our value will become.

 

LEADERSHIP

Collaboration is at the heart of designing, procuring and constructing buildings and this is part of the DNA of any practising architect. We work in teams in our practices, with other design team consultants, with our clients, with contractors and subcontractors……...the list goes on.

Teams need leaders.

Typically, development teams include the Client, Project Lead, Lead Designer and Construction Lead.

Naturally, except for process driven projects, architects typically take the Lead Designer role.

For the past 40 years there has been increasing competition from other development sector professions to take on the Project Lead role, formerly almost always the role of the Architect, and Architects have shied away from the management, cost control and design co-ordination process.

The longer this goes on, the more marginalised and commoditised architects will become.

It is of critical importance for Architects to embrace this crucial role if we want to re-establish ourselves as the leaders of the development sector.

I believe the architect is ideally placed to undertake this role – who better to integrate the increasingly complex design and development process – but we all need to make sure we have the right skills to be the default professional to do this. As I have already mentioned, this requires us to upskill in project and programme management, development economics, management and finance to lead.


Role of the Architect in Society

Architecture doesn’t exist in a vacuum. – it is a service, a reflection and an integral part of any society. Right now, Irish society would probably not place a high value on the engagement in public debate or leadership provided by architects.

A greater willingness on the part of architects to participate in political and cultural debate at local and national level would provide meaningful and informed contributions to society and could be of nothing but benefit to the perception and profile of the profession. Food for thought for all of us!!

VALUE

We should constantly remind ourselves that we do is of great value to our clients and to society. For example, right now there are more than 75,000 housing and apartment units underway across five of the country’s top architecture practices. Since 2014, when it was evident that there was an almost total dearth of office space to support incoming FDI, over 1 million sq m of office space (that’s over 11 million sq ft) has been delivered to the market to sustain the growth of new jobs in Ireland. For me, this is a clear indicator of the expertise and value of architects and our development sector colleagues and our ability to step up and meet tangible and real challenges for our economy and society.

It is my hope that the changes we are starting to bring about in the RIAI will support architects in leading the development sector to increase design’s value to society and help reclaim architects’ role as advocates for the future.

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