New research highlights SANG investment opportunities for sophisticated investors
Half of real estate professionals and wealth advisers believe that areas of Suitable Alternative Natural Greenspace (SANGs) are a good investment opportunity for HNW sophisticated investors, according to new research by Engen Group.
One fifth (22 per cent) said they weren’t and 28 per cent said they did not know.
SANGs are areas of countryside that are developed and maintained as public-access recreational parks used to offset the impact of nearby residential development on Special Protection Areas (SPAs). The SANG diverts people from using protected areas by providing alternative green spaces, complete with walking paths, children’s playgrounds, nature trails, cafes and other recreational facilities. Housebuilders must apply for a tariff on the SANG corresponding to the number of homes they intend to build to offset the increased pressure on the environment.
The research highlights that real estate professionals believe that SANGs will have a positive impact on the rate of property development in their surrounding areas, with 48 per cent predicting an increase, 42 per cent expecting the rate of development to stay the same and just 4 per cent expecting a decrease.
When asked about key drivers for this positive impact, respondents felt that local authorities will be more open to properties being built in these areas (62 per cent) because of the protection SANGs offer; Government will step up plans to build more affordable housing (22 per cent); and property developers will be willing to pay higher additional fees for building in these areas (16 per cent).
Graeme Boiardini, CEO of Engen Group, says: “SANGs have a key role in protecting important habitats and countryside and ensuring new developments in the areas are as sustainable as possible. They help local authorities unlock planning and start to tackle the affordable housing crisis. As a result, they offer an appealing investment opportunity, as well as diversification for sophisticated investors.”
ENGEN is seeking to raise GBP3,000,000 from sophisticated HNW investors to develop the Wood Street Village SANG west of Guildford, which falls within the Thames Heath Basin Special Protection Area (SPA). The investment takes the form of a simple loan with a 24-month term and 10 per cent pa interest payable. The minimum investment is GBP5,000.
Engen Group** has an interest in 41.57 per cent of the 34-hectare greenfield site, a share valued at just under GBP8,000,000 by an expert surveyor who is part of the professional body the Royal Institute of Chartered Surveyors (RICS). The new GBP3m funding will be used to appoint the charity The Land Trust to develop and manage the land to ensure it meets SANG criteria. This will help enable Guildford Borough Council to unblock the planning consent bottleneck for much-needed residential development and to address its shortage of affordable housing for low income residents.
The creation of Wood Street Village SANG represents a socially responsible investment opportunity with compelling benefits such as:
• Providing naturally planned green spaces for the benefit of the local – and wider – community
• Allowing Guildford Borough Council to freely grant much needed planning permission for homes within the 5km catchment area of the SANG
• Diverting the public from Special Protected areas to allow rare species of birds – the dartford warbler, woodlark and nightjar – to thrive
• Reducing the carbon footprint of an expanding local community by offsetting residential development with ‘clean air’ from the SANG.
Once the SANG has been developed by the Land Trust, it is then available as an environmental damage avoidance measure for new residential construction. The site allows a total of 1,700 homes to be built within the 5km catchment area of Wood Street Village SANG – each home is worth a unit of SANG. Housebuilders must apply for a tariff on the SANG corresponding to the number of homes they intend to build to offset the increased pressure on the environment. The tariff is payable before planning permission is implemented. Developers have already expressed an interest in a total of 1,433 units or 82 per cent of the site.