Policy paper

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Policy paper

Policy paper Coniuratio social housing association Parkstad Limburg
Policy paper
Social housing association Parkstad Limburg
January 2011 Policy paper Coniuratio social housing association Parkstad Limburg
Colophon
Document:
Title:
Policy paper Coniuratio
Paper Master project REMD
Subjectcode:7US15
Date:January 2011
Educational institute: Eindhoven University of Technology
Faculty:
Real Estate Management and Development
Den Dolech 2
5612 AZ Eindhoven
Postbus 5600
5600 MB Eindhoven
Telefoon: 040-2475981
www.tue.nl
Studentdata:Ruud Coppens
ID number: 0617710
Lars van Doorn
ID number: 0722064
Marianne Phernambucq
ID number: 0724352
2
Mentors: Marco van der Spank
ID number: 0615883
Dr. J.J.A.M. Smeets
Drs. ir. M. I. K. Leussink
January 2011 Preface
This paper contains the policy plan of our ‘virtual’ housing enterprise Coniuratio in
Parkstad Limburg. Coniuratio operates in accordance with the Dutch public housing
system; therefore, we conduct social as a private non-profit enterprise by primary
shelter those in need. Coniuratio has been adapting to the changing environment
and regulations. This gives us the opportunity to expand a good quality of life and
develop social facilities for our tenants the next 10 years.
Eindhoven, January, 2011,
Ruud Coppens
Lars van Doorn
Marco van der Spank
Preface
On behalf of the executive board,
3
January 2011 Social apartments in Kerkrade
January 2011 Contents
0. Introduction............................................................................................7
1. Parkstad Limburg....................................................................................9
2. History.....................................................................................................11
3. Mission and Vision..................................................................................13
4. Internal analysis......................................................................................15
6. Research of housing market....................................................................23
7. SWOT and strategies...............................................................................25
8. Competition analysis...............................................................................29
9. Competitor analysis................................................................................31
Contents
5. External analysis......................................................................................19
10. Risk analysis..........................................................................................33
11. Financial feasibility................................................................................37
12. Stakeholders..........................................................................................41
13. Closing remarks.................................................................................... 45
14. Resources..............................................................................................47
Appendix.....................................................................................................49
5
January 2011 Board of executives of Coniuratio
January 2011 0. Introduction Coniuratio
Introduction
In the Netherlands many people live in dwellings which are built and
managed by housing associations. These housing associations are
non-profit companies and need to provide affordable dwellings for people
with lower income (till €33.000,- a year) and special groups. Coniuratio, a
housing corporation which is active in Parkstad Limburg, will discuss its
history, portfolio, mission, vision and strategies. After that the there will be
looked after to the competitors, risks, financial feasibility and
stakeholders. This paper gives a clear view of what Coniuratio stands for, and
where it wants to go in the next 10 to 15 years. Parkstad Limburg
is a difficult area because of the shrinking population which causes a high
vacancy rate. Coniuratio will not only invest in dwellings, but also social
real estate to increase the livability in Parkstad Limburg.
Figure 0.1 Set-up policy paper
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January 2011 Social apartments in Kerkrade
January 2011 Despite the still growing population in the Netherlands there are some
areas which are already shrinking. These areas are South-Limburg,
Northeast-Groningen, East-Gelderland and parts of Zeeland. A part of SouthLimburg contains the region Parkstad, formerly known as “Streekgewest
Oostelijke Mijnstreek” (until 1999) and contains eight municipalities:
Brunssum, Heerlen, Kerkrade, Landgraaf, Onderbanken, Simpelveld,
Voerendaal and Nuth. Nuth was absent for eight years, but joint the
formation again at 22 February 2010. Collaboration between these
municipalties was needed to attract businesses and to provide new ways of
employment. These municipalities now have around 255.000 residents
and work together to improve the economical structure in the area.
(Parkstad Limburg, 2010)
The shrinking population in Parkstad Limburg affects the housing market
within the area. This causes a decreasing demand on the space market.
When this occurs, the demand function in the four quadrant model is
moved to the left as shown in figure 1.2. The other quadrants will not change
because of this affect.
It is important to get equilibrium within the asset and space markets. To
establish this, a rectangle must be made between all four quadrants. When
the supply stays the same, it is not possible to make a rectangle as
shown in figure 1.3 with the slim red line. The point R1 isthe level of
rent incase the supply does not change and P1 is the price of the investors are
willing to spend on real estate. Figure 1.1: Population grows per municipality, 2007-2025 (CBS, 2008)
When adjusting the supply of the housing market is possible to
establish equilibrium within this market. To decrease the supply the rent
level will come to the point of R2, with this rent level investors are willing
to invest some money in new construction. The price of these investments
is indicated by P2 and the number of square meters new construction is
shown by point C2. When new constructions are built the stock will be at
a certain level Q2 to make the rectangle and keep the market in balance.
The price of the rent level can’t continue to fall infinitely, so in the short term,
interventions in the stock are needed.
(Geltner & Miller, 2007) (Jennen & Moll, 2009)
Parkstad Limburg
1. Parkstad Limburg
9
January 2011 Future plans of Parkstad Limburg
Parkstad Limburg has the lowest average dwelling price (€ 166.000 in
2008) of the Netherlands. The average rent for a dwelling in this area
is € 540,- To improve the image of Parkstad, the housing market, the
economy and attract new businesses and families, a plan is made.
VROM (Ministerie van Volkshuisvesting, Ruimtelijke ordening en
Milieubeheer) investigated that if Parkstad Limburg does not change
the supply, the vacancy of dwellings will increase to 19% and
the prices will drop with 16% between the years 2008 and 2040.
In this plan of Parkstad Limburg the supply of dwellings will be
reduced by demolishing 6.245 dwellings within a period of 10 years,
according to the plan it will reduce the vacancy to 2%. Figure 1.2: Four Quadrant Model of Parkstad Limburg
10
Figure 1.3: Four Quadrant Model of Parkstad Limburg adjusted to the future
The plan does not only consist of adjustments to dwellings, but also
business areas, infrastructure and social real estate will need investments to
ensure the future of Parkstad. Social real estate has no clear definition. A few
examples of social real estate are schools, nursing homes, theatres, community
centers, sport facilities and shelters. Taking care of the social real estate will
increase the livability, by decreasing the vacancy level.
January 2011 2. History of housing association ‘Coniuratio’
The Dutch housing context
The Dutch housing associations were founded at the end of the 19th
century. Cities in this period were growing very hard due to the
industrial revolution. A result of the heavy growth, the conditions of the
housing market were very bad. These bad conditions motivated private
individual organizations to invest in forms like public housing. In 1852 the first
dwelling association was founded, after that more associations would follow.
The most important moments of history has been placed in a timescale
(figure 2.1). The timescale will be the guidance for the rest of Coniuratio’s
historical overview.
Foundation of ‘Sint Barbara’
In the past, region Limburg was known for it’s mining industry. In the period
between 1899 and 1965 the mining industry was booming. As a result of
this industry there was a big supply and demand for dwellings
near
the
mines.
Because
of
the
massive
arrival
of
mineworkers, the housing conditions were very bad. By introducing
the housing law in 1901 it was easier to built good houses for
these workers because of the financial support of the government.
This was the reason for the founding of housing association SintBarbara in 1910. In the beginning it was difficult to start of the bureaucratic
problems, but after 1916 the production of new dwellings increased.
After a short period of time the growth ended. WO II was a difficult
period for Coniuratio, they could not meet to the demand of social dwellings.
After 1945 the housing production was heavily subsidized by the
government. The Rose committee came with an advice for the
government in 1962. The main point in this advice was that the
associations weren’t financially strong enough. Some rules like the
bruterings operation changed with the aim to make the associations stronger.
History
Today’s characteristic nature of Coniuratio is based on decisions and
events that were made and happened in the past. By being aware of the
association’s history and by learning from the decisions that have been
made in the past, Coniuratio will certainly make better decisions in the
future. In consequence, the history contributes to unfolding the future plans.
11
Figure 2.1: Timescale history
Merger of three associations to SOM
Due to the rise in popularity of oil and gas as new natural resources, the
mining industry in Limburg had a hard time in the 60s. As a result of this bad
period, more and more mines were forced to close. In 1975 the last mine in the
Eastern Mining Area was closed. Because of these closures, the
unemployment number rose quickly in the 60s and 70s. The amount of
residents decreased, as a result of the bad economic situation most
of the ex-miners had to deal with. The number of vacant
dwellings increased and to secure the financial continuity of
Sint-Barbara and other housing associations, a merger between these
associations was necessary. In 1977 Sint Barbara merged with
two other associations to “SOM Housing Association”, with SOM
standing for Streekgewest Oostelijke Mijnstreek.
12
Deregulation and privatization
As a result of the deregulation and privatization during the 1990s the
independency of SOM had increased. In this period an operation called
‘bruteringsoperatie’ took place. In this operation the money owed
to the housing associations and the money that the organizations
owed to the State were settled at once. After this operation SOM was
completely detached from financial governmental support. In 1998
Parkstad Limburg has been introduced as the new name for the
cooperation between different municipalities in Limburg. This was also
reason for SOM to change the name in Coniuratio, which is Latin for
collaboration. It was important to follow the shared vision namely
live and work together. (Smeets, 2007)
January 2011 Overview of dwelling growth
When housing association Sint Barbara started in 1910 they had 23
dwellings, which was around the average of the housing associations
back then. The next ten years the amount of dwelling more than doubled
(59 dwellings), because of the large building possibilities after the First
World War. Within the following fifty years the housing association was
expanded until a portfolio of 1300 dwellings. The period 1970 until 1980 was
a hard time because of the financial crisis, but by a fusion with two other
housing associations the amount of dwellings was yet increased until 2500
dwellings. The next decades several little housing associations have been
adopted so Coniuratio became one of the biggest housing associations of
Parkstad Limburg with 8500 dwellings. The timeline of the amount of dwellings is shown in figure 2.2. The biggest amount of dwellings are located in
Landgraaf and Kerkrade (70,7%). The complete portfolio is illustrated in
appendix 1.
Figure 2.2: amount of dwellings in portfolio Coniuratio
January 2011 3. Mission & Vision
It’s important to have a mission and vision for the dicisions that have
to be made in the future. There are some interpretation differences
between mission and vision. Let’s make it clear that a mission stands
for the workspace of our association, a vision will show our future
per-spective. The mission forms and shapes the vision; both
will be discussed below.
A superior aim is more than only one sentence or slogan, although it’s a
well thought sentence that will summarize the true core of the organization.
Therefore, Coniuratio’s superior aim is:
Mission
The association Coniuratio has to accomplish the public housing tasks which
are written in the BBSH. Coniuratio is a social housing association; the focus
will be on social real estate in the future. The mission of Coniuratio will be:
Shared values – What for?
Coniuratio’s shared values can be described in three subgroups namely;
existing values, desired values and required values. The three subgroups
will be discussed below.
“Developing and managing social real estate and dwellings with relatively
high quality for lower income (till €33.000, - a year) and special groups to
increase the livability of the area.”
Required values
The core competences are the boundary conditions where Coniuratio has
to deal with. These conditions are documented in de BBSH. The boundary
conditions are written below. (VROM, 2005)
- Housing of the primary target group
- Guarantee the quality of the dwellings
- Involving tenants in policy and control
- Guarantee the financial continuity
- Livability (since 1997)
- Living and healthcare (since 2001)
Vision
The development process of the vision is based on the four section
model by Hans van der Loo (2007). This model contains four aspects; superior aim, shared values, risky aim and core competences. These four aspects
form an integral overview of the vision. The four aspects will be discussed
below.
Superior aim - Why?
According to the four section model, the superior aim included questions
as ‘what is our right to exist?’ and ‘what’s the essence of our organization?’
Mission & Vision
The mission has an internal dimension namely developing and managing
the real estate. But it also has an external dimension like increasing the
livability of the area.
Taking care of the social housing and especially social real estate to
increase the livability of the area.
13
January 2011 Desired values
The values which can always be linked to Coniuratio are the existing values.
Those values give you a clear vision of our organization.
Decrease vacancy to 3% in stead of 5% in the year 2025 to improve the
livability, because vacancy and livability are strongly connected in Parkstad
Limburg.
The values which aren’t a part of the organization yet can be described as
the desired values. When the distance between the existing- and desired
values are too big, the organization has a lot of work to do.
- Proactive; doing nothing is going backwards, especially in a shrinking area.
- Innovative; new solutions will provide new opportunities.
- Result orientated; it’s important to preface the main goal.
- Energetic; be quick and careful while implementing your plans.
This relation is confirmed by the local government in 2009 shown in figure
3.2. Because there are no data of the livability in 2010 regarding Parkstad
Limburg (Leefbaarometer 2010), the check if the livability actually is increased
as a result of the decreasing vacancy rate cannot yet be done. In figure 3.2
the declining of the vacancy rate in Parkstad between 2007 and 2009, is
illustrated.
Existing values
The values which can always be linked to Coniuratio are the existing values.
Those values give you a clear vision of our organization.
14
- Customizable; Coniuratio will treat you as an individual and small
alternations in dwellings are possible.
- Honestly and integrity; Coniuratio will always give an open and clear
reflection of the decisions that had been made which are of interest for
residents.
- Services focus; Coniuratio will manage social real estate to improve the
livability in the area.
- Appropriate; Coniuratio will be aware of the efficiency of the available
resources.
Risky aim – Where shall we go to?
Maybe the most important aim of the organization is the risky aim. The
risky aim creates unity and motivation to the employees. But more
importantly, it’s a goal that defines the maximize performance in period of
10 or 15 years. Coniuratio formulated the following risky aim:
Core-competences – In which we excel?
There are some competences in Coniuratio’s organization in which we
excels. These core competences are an important part of the vision.
They made Coniuratio of todaysorganization.
- Social orientated; the customers will be on the first place.
- Reliable; always be open and clear to the customers.
- Decisive; good planning and quick execution.
Figure 3.2: Vacancy as a function of Livability (VROM, 2009)
January 2011 4. Internal Analysis
Organization
As mentioned earlier, Coniuratio is a social real estate
organization. Operating in a housing association means that the
acquired benefits have to be reinvested in the community (non-profit).
Coniuratio has and always will reinvest the benefits on an efficient and
responsible way and has a reliable and clear image to the customers. The organization structure
As a result of the increase of the portfolio in the last years, the organization
has become more professional. Organizations were used to do outsourcing;
things like maintenance of housing, administration and contact with tenants
were done by other organizations. A complex structure makes room for the
traditional ‘tripod’. A back and front office, a financial department and a project
department were integrated. A detailed chart is shown in figure 4.1.
(Smeets, 2007)
Internal analysis
In this chapter the organization of the housing association
Coniuratio will be described and the content of the portfolio will be shown. The
internal analyze gives a clear view of the strengths and weaknesses of the
organization itself and the portfolio of the organization. Some of these
strengths and weaknesses will be used to produce strategies later on.
Coniuratio has not done many social real estate projects, but
wants to increase the focus on social real estate in the region of
Parkstad Limburg. The investments in social real estate should
develop a better living environment for the residents of Parkstad.
The financial crisis in combination with the shrinking character of
Parkstad is a problem where we have to deal with, for example a
higher unemployment, relative decline of income and a decrease of
the dwelling value. It’s important to become and stay financially healthy
in these difficult times. For solving these problems, operating in an
advanced and result orientated way is very important. Coniuratio should
search for new market combinations; innovation has an important role.
15
Table 4.1 Overview portfolio
Current portfolio
Overview total portfolio
The total number of properties owned by Coniuratio at the end of 2010 is
8.574 dwellings. Most of the dwellings are located in Kerkrade, Landgraaf
and Simpelveld. For a more specific overview of the portfolio and a clear
map of all the locations, see figure 4.2 and appendix 1.
16
Figure 4.2 Overview portfolio
January 2011 Coniuratio social housing association Parkstad Limburg
Dwellings divided by dwelling type
Figure 4.3 gives the division of portfolio by dwelling type.
Remarkable, Coniuratio has many single family as well as
apartments. The number of senior dwellings is quite low although.
Looking at the total market, the number of apartments is quite big.
Figure 4.3 Dwelling type
Dwellings divided by year of construction
Figure 4.4 gives the division of portfolio by year of construction. The
most of the dwellings are built between 1970 and 1979. This is not very
strange because of the history. Also in the years after WO II, there was a big
demand for new dwellings. The number of new dwellings in the recent years
is very low. This can be described by the start of the shrinking in Parkstad.
January 2011 Dwellings divided by rental price
The rental price distinguishes four categories; expensive to rebate limit,
expensive above rebate limit, affordable and inexpensive. Most of the dwellings
have an affordable rental price, as is shown in figure 4.5. The smallest part of
the rental price is expensive, this is quite usual for a social housing association.
Figure 4.5 Rental price
Portfolio conditon
Only a small part of the portfolio has an excellent condition, as is shown in
figure 4.6. Most of the dwellings are in a moderate/well condition. This means
that maintenance is needed but on the long term. However, the other 20%
which is in a bad condition needs short term maintenance. Overall there is a
lag in maintenance.
Internal analysis
Policy paper 17
Figure 4.4 year of construction
Figure 4.6 Conditions
Overview strengths and weaknesses
Coniuratio has several strengths and weaknesses (table 4.7) which will be
useful in the SWOT-analyses to create new strategies for the company. The
analyses and strategies will be explained and formulated in later chapters,
first an external analyses of the Parkstad region is necessary.
Table 4.7 Strengths and weaknesses
18
January 2011 5. External Analysis
Demographical
Demographically, Parkstad is approximately 20 years ahead of
the rest of the Netherlands. This means that it can in the future
be used as a good reference for things to happen anywhere else.
The region is known for its excessive graying in the last couple of decades.
In 2006 one out offour persons is older than 65. Prognoses made by the CBS
indicate that this ratio will shift to 1:3 persons in 2025.
The other age groups indicated by the CBS (youths up to 20 year and the
productive working age, 20-60 years), both show a big decrease in the next
15 years. This shows that besides the graying there’s also a steep decline in
population in the coming decades. Especially the young educated
people move away.
Since 1997 there has been a population decline in Parkstad, with 0,5
to 1,0% per year. It is expected that in the period 2006-2025 the population
will decline by a total of 30.000 inhabitants.
(CBS, 2010)
Economical
In the first half of the 20st century the entire region Parkstad was one of
the most prosperous of the Netherlands. This was due to the frequent
mining at that time. However, because of the strong rise of oil and gas
around 1960, more mines were forced to close. Due to the closure of these mines there was a significant
drop in employment in the 1970s and because of this, prosperity decreased.
In the 1980s heavy and non-commercial industries were
alternatives for the unemployed lower-class. But late 20th century these
branches had hard time either, mainly due to the transfer of
work to 3rd world countries.
The current employment rate is one of the lowest in the Netherlands and
the educational level is very low. Also, the number of beneficiaries is very
high in the municipal of Heerlen (which roughly embraces Parkstad). The
long-term perspectives don’t seem to make any change in this matter.
(CBS, 2010)
However, since 2005 economical impulses have been initiated to
ensure that the south of Limburg, again, can compete with other nearby
regions. The main focus of these impulses will be innovation and technology.
What positive effect this will have on the region Parkstad is yet unknown.
External analysis
DESSTEP is a method to analyze the external aspects of a
corporation and stands for: Demographic, Economic, Social, Spatial,
Technological, Ecological and Political. The DESSTEP gives a clear
image of the external factors that might influence our business plan in the
upcoming 10-20 years. Purpose of this analyze method is to gather
relevant information about these factors and use it to formulate threats and
opportunities which serve as input for the SWOT analysis in the next chapter.
The last economic issue are the energy costs. The costs had been
increasing very hard in comparing with the other costs of the tennants
the last years. The expectations are that these costs will keep increasing
and may transcend the rentprice in the future. (overview appendix 2)
Social/ Cultural
In Parkstad Limburg there isn’t a clear regional profile. They have failed
to develop a new identity after closing the mines.
Parkstad Limburg is collaborating together since 2007 in a strategic
alliance with its border region Stadteregion Aachen. The
number of people in this region is as large as South Limburg. This region
characterized itself with lots of cultural heritage values.
19
Parkstad Limburg has a complex social structure. The inhabitants
of cities prefer privacy in small social communities. In history large
scaled urban developments have been counteracted. Nowadays, this
results in a large variety of mostly good quality living environments.
Parkstad tries to combine the cultural diversity and high quality professional
art forms with its image as a network region. The city of Heerlen has the
biggest concentration of traditional regional arts and cultural expressions.
Spatial / Geographical
Parkstad Limburg is a border region and a backside area in the South-East
of the Netherlands. The land is fragmented and has an unclear structure.
Besides the unclear structure, Parkstad has moderate accessibilities
that influence the traffic flow.
20
Technological
The business area situated just over the border with Germany, ‘Avantis’, is becoming a central connection between two new regional
developments. Avantis identity is new energy. This identity could be
the new face of the whole region. This border area becomes a medical,
infrastructure, educational, entrepreneurial and business technology
meeting point. One of the ambitions is to develop a cardiovascular
center of excellence for two academic hospitals; RWTH/Klinikum
in Aachen and AZM in Maastricht. (Avantis, 2010)
The collaboration between Parkstad Limburg and the border region
‘Stadteregion’ Aachen could be very positive for the technological
developments of Parkstad. This region is famous because of its well known
technological university (RWTH) with 30.000 students. The number of annual graduates is bigger than the total number of graduates in the Netherlands.
January 2011 Ecological
Parkstad takes good care of the environment, and most of the time the
environment is more important than economic profit. In some cases
an exception needs to be made, like improving the infrastructure. The
infrastructure until now was created by natural routes within the
region, because mobility becomes more and more important, a
transformation needs to take place. By increasing the accessibility in
Parkstad, more companies will settle in this area so the employment will
increase, ultimately this will help to avoid shrinking of the
number of residents.
To improve the livability in Parkstad, the environment needs to be
maintained, both inside and outside the village or city. The amount of green
landscape will be expanded as much as possible. This can be done by
demolishing old vacant real estate. (Parkstad Limburg, 2008)
New energy and durability are the main focus in Parkstad; Campus
Avantis (Business Park which is located in Holland and Germany, between
Heerlen and Aachen) is created to develop this new energy and sustainable
products. (BTM, 2010)
Political
The government has recognized the problems of a shrinking
population and made a plan to maintain or even increase the livability of
Parkstad to keep the residents and attract new residents in the future.
One of the main points of the plan is to establish balance in the housing
market and prevent a high number of decay and vacancy. The government will
provide permits faster, but the housing associations and public sector need
to pay demolishment and operating losses which are necessary to create a
balance in the housing market. Other main points are to
improve the infrastructure in Parkstad and increase the livability of
the area by developing new green areas.
January 2011 External analysis
The costs of this plan will be a few hundred million euro or even more
and around 20% of these costs are lost investments, but need to be
done to save Parkstad. The plan is already in progress and will take
many years to complete. Because of the crises and austerity plans as
well nationally as European is the position of different grants unsafe.
(OB Parkstad, 2010)
21
Table 5.1 Opportunities and Threats
January 2011 Social apartments in Heerlen
January 2011 Before all the external factors from the DESSTEP analyze method can be
determined, a closer look at the housing stock and the market demands
is required, to give more insight in how they interface with each other.
Housing stock
A logical trend in the last couple of years is that the rental housing stock is
decreasing, especially in the inexpensive price range. In the occupied market
there’s also a decrease in selling price, but this decrease is relatively small in
the lower segment (appendix 3). Other developments which are important to
be noted is the strong decrease of transactions in the occupied market the last
years and the strong increase of sales time in the occupied market. Most important is the current vacancy level which is very high compared to the rest of the
Netherlands: 4,4%. (Vaessens & Ven, 2009)
Market demands
The majority of home-seekers say they are opting for rented
accommodation as there next home. Besides this increased demand
in possible tenants, 23% of the current tenants want to pay more for
their future to be home; 58% wants to stay in the same price range.
Apartments without elevators are decreasing in popularity. As a
result of that, apartments with elevators continue to increase in popularity, as are (semi-)detached homes. There’s also a surprising high demand to
housings build in the 1930s. As for the elderly, life-resistant housing is by far
the most popular living choice. Because of this trend, the residential care
homes are decreasing in popularity. They also have a strong tendency to rent
in the future, and for the location healthcare and cultural facilities are the
most important factors. The building year isn’t a big issue for most house
hunters. If it is, the preference goes to a newer home. More important is
the condition of the property, this should be good for most home-seekers.
In absolute terms, Heerlen is the most popular place to reside,
followed by Landgraaf, Kerkrade and Brunssum. However, in percentage
terms, the three rural municipals are the most popular. Safety is the most
important reason for the living location, followed by shopping facilities.
Nearby healthcare facilities is also an important factor in the choice
of a new home, especially underneath the elderly group (65+).
Most home-seekers live in Heerlen (46%), followed by Kerkrade (21%),
Landgraaf (13%) and Brunssum (11%). (Pas & Pas, 2009)
Research of housing market
6. Research of housing market
23
January 2011 7. SWOT & Strategies
The strengths are characteristics of the organization that give it an
advantage over others in the region. Weaknesses are characteristics that place
the organization at a disadvantage relative to others. External elements in the
environment that could cause trouble for the business are represented in the
opportunities. At final are the threats described. The threats are the external
elements in the environment that could cause trouble for the corporation.
Figure 7.1: Framework strategies
The SWOT-figure on page 28 shows a clear view of the links between external en internal elements. Most striking combinations are used to prepare the
main business strategy in the next chapter.
Core strategies
First of all there will be given some sort of framework for our
strategies (figure 7.1). As already described the region where Coniuratio is
operating in is a shrinking area. The shrinking is a fact and the decrease of
households is connected with this fact. All the strategies that will be
developed have to deal with the shrinking and the decrease of households.
This means that demolishing or selling will be inevitable. Also the social
facilities will be the mean purpose in the development of the
different strategies.
Demolish choices have to be made by Coniuratio. A lot of issues are
involved with demolishing. The first important thing to look after is
the lifetime of the dwellings. The dwelling must be at the end of the
economic and functional lifetime before demolishing the dwelling. The
second thing is that Coniuratio wants to demolish in dilution areas, hereby
you can not break the current structure and identity of the neighborhood.
There are important social aspects to look after. Coniuratio wants involve
their tenants closely by important choices. Coniuratio realizes that some
social problems regards the demolishing task will come but the intention is
to keep the tenants content. Coniuratio is a social housing association, social facilities will be central in
our vision. Coniuratio will create a facility cluster to secure the facility level
for the coming 10 years. The facilities will refer to our main target groups.
Social facilities, health and care facilities are the main facility options.
Indoor provisions and space for culture activities will be an practical
example for us as social housing association.
SWOT & Strategies
The SWOT-analysis is necessary to compose a well considered business
strategy. This strategic planning method helps evaluating the Strengths,
Weaknesses, Opportunities, and Threats involved in a corporation venture.
25
Graying as an opportunity
Graying is often seen as a negative phenomenon, but it has also its benefits. In
this strategy graying will be seen as a chance. The increase of elder people in
the next years will become a large new important group to be reckoned with.
Research has shown that people will become older in general. New techniques
in ‘Domotica’ makes it easier for them to stay longer in their current dwelling.
The presence of hospitals, recreation areas and shopping areas will have a
positive influence on this growing population. The green environment near
and in the cities will be pleasant for the elderly. The current offerings are not
enough to attract and keep them in Parkstad. New facilities and dwellings for
this growing group can be (re)developed and will create a better environment.
26
Innovation and sustainability
Coniuratio is an innovative organization which is always searching and
interested in new developments. Parkstad has some unique opportunities,
i.e. most ours of sun in the Netherlands, and it’s an attractive region for
companies specialized in renewable energy, mainly due to its convenient
location. These things can be important in changing the portfolio into a more
sustainable portfolio. It gives Coniuratio also the chance to pursue a more
distinctive profile. With this knowledge Coniuratio can respond to
the rising energy costs.
Dwellings in a poor condition will eventually cost more on energy than the
tenants can afford. The use of sustainable energy can have a positive influence
in the long term. To serve Coniuratio’s target groups, the rental prices or the
energy costs need to be reduced. This will give a positive effect on the quality
of the dwellings and will satisfy Coniuratio’s tenants. Other new facilities in
waste separation or recycling can have contributions to sustainability as well.
January 2011 Collaboration at different levels
More organizations and public associations have to deal with the same
problems as Coniuratio, especially in a shrinking region like Parkstad. Solving
these kinds of problems is usually much easier in a team than by in your own.
Parkstad itself is already an important step in collaborating on a regional level
but it is even more important for different organizations to follow this trend
and collaborate on different levels so new opportunities arise. The
opportunities are plenty: Parkstad can serve as a network “city”,
in the ELAt region, and the convenient location at the border with Germany
areexamples of these opportunities.
The collaboration at different levels can lead to new product market
combinations; foreigners from Germany and Belgium for example. Social
facilities for these new groups have to be examined, so Coniuratio
can effectively respond to their demands. Another positive effect on
the economy of Parkstad can be the development of the neighboring
economies, i.e. Aachen, Maastricht, Liège and maybe even Eindhoven. Review of the portfolio
It’s important to match the portfolio with the current market changes and
anticipate on future ones. Reviewing and fine tuning the current portfolio to
the market gives opportunities for the livability. Trends like; the increasing
popularity of renting, the population decline and decrease in popularity of
apartments, are issues which much be kept in mind. If we examine these trends
precisely and reflect them on Coniuratio’s current dwellings orts and types, it
creates a more accurate picture which steps to take with the current portfolio.
Coniuratio social housing association Parkstad Limburg
Financial strategie
Coniuratio wants to stay financial healthy in the future. Financial funds
will be released to finance the large developments. Sales of some
of our rental dwellings will be an option. Coniuratio will sell their
dwellings with a discount of 20%. Tenants gets the opportunity to
buy their own occupied dwelling. If there will be a financial gap at the
end, Coniuratio won’t cut in the first place in the investments in the
social facilities. Cutting in other social expenditures is also a option.
January 2011 SWOT & Strategies
Policy paper 27
S2
Customizable
S3
Innovative
P S4
Large part senior/care
S5
Large part single family
S6
1/4 reached limit 50 years
S7
Large middle segment
O W1 Region dependable
o
o
++ +
+
+ + ++
++ ++
+ + +
+
+
+
o
+
+
++ ++ +
++ +
++ ++
+
+
o
+
+
o
W5 Large part moderate condition
Weakness
28
Strategie 1
Figure
7.2: Matrix
Collaboration
at different levels
Strategie 2
Graying as an Opportunity
Strategie 3
Innovation & Sustainability
Strategie 4
Review of the Portfolio
o
+
+
+
+
+
o
+
o
++
-
+
o
o
o
-
---
-
o +
+
- - -+
o
-
-
o
o
o
-- -- -- --
-
+
o
-
-
-
-
+
-
-
S2
S3
P S4
Pro collaboration
Customizable
Innovative
-
Economy based in commercial services
Parkstad; Networkcity
Oppertunities
Strength
O S1
++
+ +
++ +
Large part senior/care
S5
Large part single family
S6
1/4 reached limit 50 years
S7
Large middle segment
O W1 Region dependable
o
o
+
++
+
+
+
W2 Too little focus on social facilities
P W3 Large part apartments
W4 Small part of new dwellings
W5 Large part moderate condition
Weakness
Strategie 1
Collaboration at different levels
Strategie 2
Graying as an Opportunity
Strategie 3
Innovation & Sustainability
--
January 2011 T11
o
-
Threats
T10
-+
+
-
T9
Apartements without elevator decrease in popularity
--
o o
-
T8
Administrative organizations counteracts
innovation of regional thinking
o
- --
o
-
T7
Unsafe position grants
+
T6
Fragmentation and unclear structure
o
T5
Moderate accessibility
T4
One problem neighborhood
T3
No profiling
T2
Fragmentation both socially and culturally
T1
Population/demografic decline
X3
Decentralized location
Ageing (changing demografic)
Border region
Life resistant housing more popular, residential care homes less
X2
+
o
P W3 Large part apartments
W4 Small part of new dwellings
Renting is getting more popular
++
o
W2 Too little focus on social facilities
Partnership Parkstad
O10 O11 O12 O13 O14 X1
Most hours of sun (Netherlands)
O9
Green qualities of the environment
O8
Cooperation with two academic hospitals
O7
Part of the ELAt-region
O6
Culture linked recreation attractions
O5
Attractive for companies in renewable energy
O4
Many retail/recreation attractions
Presence of good quality shopping area's
Economy based in commercial services
++
+ +
++ +
O3
Young entrepreneurs aren't connected
with existing business
Pro collaboration
O2
High unemployment
O S1
Parkstad; Networkcity
Strength
Oppertunities
O1
Cooperation with Aachen and it's technology
Policy paper Strategie 4
Review of the Portfolio
o
January 2011 In this chapter the negotiation power and threats of different parties
Coniuratio has to work/deal with, will be described and analyzed, using
Porter’s Five Forces Model (figure 8.1). This model uses four ‘pieces’ of
input that eventually will lead to the amount of competitiveness that
takes place within Coniuratio’s working space.
Threat of New Entrants
Bargaining Power
of Suppliers
Rivalry among
existing competitors
Bargaining Power
of Buyers
Threat of Substitutes
Figure 8.1: Porter’s Five Forces Model (Porter, 1979)
Negotiation power of suppliers
In the case of Coniuratio, suppliers have an average negotiation power. For
example the local government, which takes care of the issuance of land and
the provision of permits. For the latter, they have an important role when it
comes to new development plans, but due to the low land prices, issuance
will not be the biggest obstacle. Other suppliers with a less dominant position
at the negotiation table are the developers and contractors. Mainly because
they operate in an aggressive market, especially in these tough economic
times. When the complexity of the task increases, the negotiation power will
improve for these suppliers. Important suppliers with a high negotiation power are the financial institutions that provide loans and mortgages. They have
a key role in the start of a new project.
Coniuratio also has to deal with property managers and maintenance
enterprises. These suppliers have a low negotiation power, due to the
low amount of available work in Parkstad. In a list with all the suppliers,
the parties that utilize the social facilities can’t be forgotten. They
serve both as buyers and suppliers because they also have to supply
the property with their specific products. In this case these parties
(institutions/organizations) have an average negotiation power.
Negotiation power of buyers
Parkstad is a prime example of a clear buyers market. The supply is much
bigger then the demand. Therefore, the tenants have high bargaining
power. They have a large freedom of choice and this reflects their good
position at the negotiation table. When it comes to the social real estate
Coniuratio develops, the profit and non-profit organizations/institutions
which will use these objects have an average negotiation power. The social
real estate will largely be developed in coherence with these organizations.
To make these projects a success, a healthy interaction has to take place
between Coniuratio, who develops, and the organization/institution using it.
Threat of substitutes
The rental sector can be divided in private and commercial rental and
rental through a housing association. The private and commercial sectors are
not the biggest threats for Coniuratio’s business. As a housing association,
Coniuratio has an advantage because it can keep its rental prices low, due to
the social dwellings, especially in a buyers’ market like Parkstad. Furthermore,
commercial associations (i.e. APB) can not achieve the desired yields in the
Parkstad region. They will probably never operate in a shrinking region, but
always in more prosperous ones. Another substitute product is the owneroccupied housing market and the private construction of new homes. In the
region Parkstad the house prices are low, so it is an average threat for housing
associations.
Competition analysis
8. Competition Analysis
29
But the risk of buying a home is far larger than renting one, especially in an
‘unattractive’ region like Parkstad, where future prices will decrease for
certain. The private construction of new homes, maybe in the near future the
even cheaper “catalogue houses”, is also a big substitute threat. Land prices
are very low so it is very attractive for people to build their own homes in
Parkstad. Of course the same risks as buying a house apply here, but one of the
main advantages is that the residents can adjust the building plans to
their own tastes.In regard to the social facilities, the most important
substitute ‘products’ are the healthcare, educational and social institutions Coniuratio tends to cooperate with. These institutions (and organizations)
have the choice to become the initiator themselves, but it is (financially)
safer to do this in partnership with, for example, a housing association. In this
matter, the threat of different types of partners is nil, because of the risky
investments that need to be made.
30
Threat of new entrants
Due to the shrinking characteristics of the Parkstad region, the
founding of new young housing associations are out of the question,
also because of the high entry barriers to operate in this market (large
investments, in compliance with BBSH). Associations that operate from
another region/city, i.e. Belgium and German associations, will probably
never have the intension to expand their business to Parkstad, because it will
be hard to build up and maintain a financial healthy position on the market.
The development and exploitation of social real estate is in general a
privatized market. Newcomers to this market have to keep in mind that
the investments are risky, but because of the need of certain types of
social real estate, there will always be an average threat for new entrants.
January 2011 Threat of established rivalry
The current threat of competitive housing associations is high. Because of
the small demand and large supply, associations have to act very competitive. In the future, Coniuratio’s wants to become more distinctive then there
competitors so prognoses are that this threat will be reduced to average.
Social real estate is, obviously, present in Parkstad, but Coniuratio’s
competitors have not focused on it at this moment. Of course this could
change in the future, but for now the threat can be described as average.
To make things more clear, all of the analysed values can be shown in
table 8.2.
Table 8.2: Level of competition
January 2011 9. Competitor Analyses
In a competitive market it is important to know who the competitors are. The
following questions are important to look after: What are their strengths and
weaknesses and what are their objectives? In which direction are they going,
or do they want to go? What are their strategies, and where does Coniuratio
stand compared to the others?
5. Identification and choice of
competitors
4. Objective
s
3. Current strategy
Competitot analysis
The competitor analysis of Alsem (1991) (figure 9.1) clarifies which housing
association is the biggest competitor and which association is not a direct
rival for Coniuratio.
Market definition
2. Objective
s
1. Future behaviour
Intern analysis
Own relative strengths
and weaknesses
Figure 9.1: Competitor Analysis (Alsem, 1991)
There are seven associations in Parkstad who can be seen as a real
competitor; Weller, Wonen Heuvelsteden, Hestia, Woningstichting Simpelveld, Wonen Zuid, Land van Rode (LVR) and Vesteda. These competitors
in Parkstad Limburg are first analyzed on five aspects of business: the size,
diversity of the portfolio, the commercial approach of each association,
the attention to innovativeness and sustainability, and to what extent the
development of social facilities are taken into account. These results are
plotted in the spider charts, illustrated in figure 9.2.
31
Figure 9.2: Spider chart analysis of Coniuratio and its seven competitors.
January 2011 As seen in table 9.3, Hestia and Wonen Zuid are the biggest competitors. They
both have a lot of similarities with Coniuratio regarding the PMCs. Another
competitor to keep in mind is Wonen Limburg and Woningstichting Simpelveld, particularly in the future, though the latter one is operating on a smaller
scale.
Figure 9.2: Spider chart analysis of Coniuratio and its seven competitors.
To give a better comparison of the competitors’ portfolio, all of them are
compared on rent price base. These graphs can be found in appendix 4.
Finally a competitive overview in Product-Market-Combinations (PMCs)
between Coniuratio and the competitors is shown in table 9.3. The
competitiveness is divided in standard dwellings and social facilities.
Also, an estimate is made for the present and the future.
32
High = same PMC’s
Medium = particularly corresponding
Low = different PMC’s
Table 9.3: Competitors level for the current and future PMCs
Conclusions competitor analsyes
Coniuratio has some competitors with very similar characteristics. When
it comes to scale, Land van Rode and Woningstichting Simpelveld can
be excluded as real competitors, even though they operate in a small
area Coniuratio is also active. Vesteda’s portfolio focuses on the higher
segment dwellings; therefore it is not a direct competitor of Coniuratio. The other associations, i.e. Weller, Wonen Limburg, Hestia and Wonen Zuid
are the biggest competitors. In regard to the social facilties and its commercialism, three associations stand out as the closest rivals for Coniuratio: Weller,
Hestia and Wonen Zuid. These three can, overall, be seen as the associations
Coniuratio has to follow accurately in order to compete with them at a
healthy level.
January 2011 10. Risk Analysis
Risk Profile
As made clear earlier, Coniuratio is a social housing association, with a
focus on social facilities to improve the livability in its neighborhoods. It is
obvious, they have good relations and many cooperating projects with several
parties. In general, commercial developers operate on their own. But for
Coniuratio collaboration with stakeholders is essential to develop their social
facility projects in Parkstad.
The main focus of Coniuratio is not only financial profit. That is why
the portfolio of Coniuratio has relatively more unprofitable projects
compared to other associations. These kinds of aspects, like collaborating and
unprofitable projects, influence Coniuratio’s risk-profile. To become a social
real estate association, by developing more social facilities, Coniuratio has
to accept more risks compared to a public housing association. Developing social facilities is more complex and diverse, unlike the more ‘standard’
developments of dwellings. The risk profile is shown in figure 10.1.
Risk analysis
Public utility housing enterprises are real estate intensive entrepreneurs which involves high risks when it comes to both management and
development in different stages. In addition to the acceptance of risk,
it sometimes can be reduced, delegated or eliminated to others. In this
paragraph an overview will be stated of how Coniuratio deals with its risks.
Furthermore, Coniuratio’s risk assessment will be discussed using a social
facility cluster project as an example.
33
Figure 10.1: Risk Profile of Coniuratio
Risk Analysis of a future development
A checklist (see appendix 5) is used to give an overall image of all the
major risks involved in one of Coniuratio’s future developments. The risk
aspects in the checklist are subdivided into spatial/physical, social,
political/administrative, legal/procedural, financial/economical, quality
and collaboration, which occur during different phases of the development
process.
January 2011 The full analysis can be found in appendix 6, together with a more detailed
description about the development plan itself, the working method and what
the results will be.
To decrease the biggest risks, cooperation with future stakeholders is one
of the most important aspects. The response makes clear that there are
risks that can’t be just accepted. This project will eventually strengthen
Coniuratio’s position as a social real estate company in Parkstad. The project
increases the livability of Coniuratio’s tenants; it adds something more than
just a home for their customers. One of the more important conclusions is
that when Coniuratio ends up in a poor financial state, these kind of projects
can’t be started up and should be postponed or even cancelled.
Risk and Yield total portfolio
The total portfolio of Coniuratio is shown in a graph in figure 10.3. The current risks of all the (clusters of) dwellings are plotted against the total yields.
The green and blue dots are the current clusters of dwellings
within the portfolio. The green ones are the clusters that stand out in
the whole graph and will be described below:
Figure 10.2: Overview of the social facility area in Terwinselen
34
The project which will be analyzed is a social facility cluster project in
Terwinselen, Kerkrade (figure 10.2). The social facility cluster contains an
elementary school, some healthcare facilities, a pharmacist, a medical
support centre, a community centre for cultural activities and 800 m2
small-retail. Decided is to analyse this particular development plan, because
it is a typical example of what the aim and strategy of Coniuratio will
be in the (near) future.
1)
Apartments in Schaesberg, building year 1974, expensive:
Expensive apartments but very attractive for citizens of
Landgraaf and Heerlen.
2)
Most of the dwellings in Simpelveld. 30 years old but because
of it good, quiet location very profitable for its age.
3)
Large cluster of senior apartments and single-family homes in the Kerkrade neighbourhood Terwinselen. Most of the dwellings are
almost 30 years old but quiet attractive due to some
healthcare facilities nearby.
4)
Large apartments in Dauwe Weien, Heerlen, excellent condition,
very attractive due to its convenient location in Heerlen.
5)
Old (>40 years) single-family dwellings and apartments in an average to bad condition, first priority for demolishment in the near future.
6)
Affordable apartments and single-family dwellings in Heilust,
Kerkrade. Not very popular, thus providing low yields.
A)
Social facility cluster in Terwinselen, Kerkrade. It is a financial risky
project which will result in low yields but eventually improves
the liveability of Terwinselen.
B)
Sports hall in Landgraaf. In Landgraaf Coniuratio has developed a sports hall which is used by schools, sport clubs and private groups. Due to the low yields, the development risk is quite high.
C)
Another future investment will be a community center in Schaesberg, Landgraaf. A project with possibly the lowest future yields, but
due to its small size, not the biggest risk to take.
January 2011 Risk analysis
The red dots are the current and future social facilities Coniuratio wants to
develop and manage:
35
Figure 10.3: Overview of the spread of risks of Coniuratio’s portfolio.
January 2011 11. Financial Feasibility
Balance
Coniuratio starts with a financial healthy balance in 2011. The solvability
2011 is 24,10%, the liquidity in this year is 1,20. Coniuratio starts in 2011
with equity of more than 90 million euro’s. The short and long term dept
for this year are 285 million euro’s. The total assets and liabilities are on
the balance for 375 million euro’s. In appendix 7 there is a total overview of
Coniuratio’s balance.
Scenarios
The economic developments and the effectiveness of Coniuratio’s strategies
are difficult to forecast. This is the main reason for Coniuratio to choose
two different scenarios for the next 10 years. The main difference between
both scenarios is the economic climate. Some parameters will be different;
this will lead to different costs and income for both scenarios. As a result of
this, the planned interventions will be looked after and may change. In both
scenarios, the financial risks will be guaranteed.
Best case scenario
The economic developments are positive in this scenario. De sales of some
of the dwellings is going well, some more dwellings will be sold to generate
some more resources for new developments. The vacancy level decreases
in a positive way, as a result of this the rent losses will also decrease in a
positive way.
Enough space for new developments according our strategies belongs to the
best case scenario. Sufficient senior and care dwellings will be developments
within the financial situation. There is also enough space to improve the
sustainability of a large part of the portfolio. During the years 1.370 dwellings
will be demolished, almost 1.100 new dwellings will be developed. Overall
the total portfolio will shrink with 458 dwellings. In appendix 8 there is a
total overview of the mutations in the best case scenario.
Despite the positive economy, every year there will be a loss at the end of
the years. Great investments have to be made, those investments will mostly
be paid back after some decennia. Figure 11.1 shows a quick overview of the
total costs and incomes in the best case scenario. (In appendix 9 there is an
extended overview of the costs and revenues).
Financial feasibility
As discussed in chapter 1, it’s important to get equilibrium within the asset
and the space market. The right combination between supply and demand
is important as described in chapter 1. In Coniuratio’s vision the vacancy has to decrease to 3% within a period of 10 years. Changes in the demand should be corrected in the supply side, for example by demolishing
or development of new dwellings.
To determine whether the formulated strategies in chapter 7 are actually
realistic to carry out, the associated financial feasibility has to be conducted.
This feasibility will be conducted in accordance with the in chapter 10
determined risk-profile. Coniuratio’s profile is mostly risk-avoiding, even
though there’s an awareness of the shrinking characteristics of Parkstad
Limburg. Coniuratio’s main goal is to reduce the vacancy level, so one of
the more important aspects of the strategy is the demolishment of a lesser
attractive part of the portfolio and older dwellings that have “completed”
their lifecycle.
With the conduction of the financial feasibility, it can also be determined
if future developments of social facilities fit within Coniuratio’s
financial boundaries, for example the social facility cluster in Terwinselen,
Kerkrade which will be developed in 2011-2013 and is financially quite risky.
Two scenarios have been conducted in the following analysis: a worst- and
best-case scenario, with the reality probably lying somewhere in between.
Important is, after each step, to reflect the results on the preliminary
formulated strategies, especially during the conduction of the worst-case
scenario. The poor economic situation and the negative developments in
Parkstad can affect the development of risky projects, like the social facilities
cluster in Terwinselen, i.e. postponement or even cancellation.
37
January 2011 It is not strange that in the worst case scenario there will be a loss every year
too. A positive effect of the bad economic conditions is that the inflation will
decrease to a level of 1,6%. Figure 11.1 shows a quick overview of the total
costs and incomes in the worst case scenario. (In appendix 11 there is an
extended overview of the costs and revenues.)
Figure 11.1: overview revenues and costs of best and worst case scenario
38
Worst case scenario
The economic developments are not as positive as in the best case scenario.
The sales of the dwellings are disappointing, also the sales prices of these
dwelling will decrease further. This results in a higher rent loss.
Demolishment of dwellings in a poor condition must go on, to get the desired
decrease of the vacancy level. The bad economic situation will influence
the costs and incomes in a negative way. New developments will be looked
after and some of these will be removed. Also the sustainability of some
dwellings will be cancelled. During the years an amount of 1.450 dwellings
will be demolished. Therefore 920 new dwellings will be developed
according Coniuratio’s strategies. Overall the total portfolio will shrink with
639 dwellings.
Solvability/liquidity
It is very important to look to the solvability and liquidity during the years.
The solvability gives a view of the degree in satisfying Coniuratio’s financial
obligations. In both scenarios the solvability will decrease strongly. In 2020
the solvability will be at the level of 18,54% in the best case scenario, in the
worst case this will be a fraction lower namely 18,17%. Figure 11.2 gives a
total overview of the solvability of each year.
January 2011 the debts has influence on the solvability though. Coniuratio has been able
to keep the rate constantly. (In appendix 12 there is an extended overview
of the both balances)
Investments
In both scenarios, different investments will be made by Coniuratio. The opportunity to invest will be different in both scenarios. In the best case scenario there is investment potential for more than 171 million euro, 1075 new
dwellings will be developed and more than 3800 will be made sustainable.
In the worst case scenario there is only investment potential for 146 million
euro. In this scenario more dwellings will be demolished and less dwelling
will be developed, 920 new dwellings will be developed and 3420 dwellings
will be made sustainable. Figure 11.3 gives an overview of the investments
in the best and worst case scenario.
39
Figure 11.2: Solvability best and worst case scenario
The liquidity is also an important financial aspect. This ratio gives a view
of the degree in satisfying Coniuratio’s short term debts. Through the
yearly losses Coniuratio needs increase their debts to be liquid. Increasing
Financial feasibility
Policy paper Figure 11.3: Overview investments best and worst case scenario
January 2011 12. Stakeholders
Coniuratio has a wide network with strategic alliances and suppliers, all of
them are located in Parkstad Limburg. By working with local companies the
number of jobs in the area will increase, residents will less likely relocate
because of the shortage of jobs and thereby prevent a higher vacancy rate.
Coniuratio also provides shelter to different types of tenants using multiple
agencies, like the “Salvation Army”, “Reclassering Nederland” and “Mondriaan
Zorggroep”. This way they try to help ‘special’ tenants and agencies and
meanwhile decrease criminality and increase security and livability. The
current implementation of all the alliances/suppliers is illustrated in figure
12.1, together with all the stakeholders in Coniuratio’s network. A more detailed overview of all the current cooperative partners, suppliers and the most
frequently used stakeholders in Coniuratio’s network can be found
in appendix 13.
Stakeholders
Now
Until now Coniuratio has focused on dwellings and delivering good quality
for reasonable prizes. To do this they need to cooperate with different
corporations. The collaboration varies by corporation, some can be a
strategic alliance, others strategic suppliers or just a network player. The
main alliance Coniuratio is already involved in is Coniuratio OPL B.V., together
with OPL. This alliance takes care of the developments of dwellings. In case of
the suppliers, Hypodomus is Coniuratio’s most important partner. It handles
the service around the selling and renting of Coniuratio’s dwellings.
Figure 12.1: Implementation of corporations
41
Future
In the year 2011 Coniuratio will invest in social real estate to realize there
strategy as a social real estate association. By creating alliances with other
stakeholders, Coniuratio increases their specialism of care and project
development and can decrease their costs. The new implementation of
cooperation is illustrated in figure 12.2. Because of the increase of elderly
people, the desire for care increases. With the alliance Coniuratio Homecare
B.V., Coniuratio uses the expertice of Homecare to develop better care dwellings, for example a type of dwelling so couples can stay together although
only one of them needs care and the other does not. Together with this
alliance Homecare comes in as a new supplier to facilitate and offer service
to the new ‘customers groups’ the alliance provided. As a result of this new
alliance, Coniuratio OPL B.V. will start to develop social facilities, which are
contrived by Coniuratio Homecare B.V. Due to the future strategies Coniuratio
formulated, two new stakeholders will surface in the network: In partnership
with Connexxion, new public transportation routes will be offered to make it
easier for the more vulnerable elderly to visit the developed social facilities.
In regards to the strategy concerning the sustainability and durability
of Coniuratio’s portfolio, one of the main actions is to install PV
panels on a large part of the dwellings. These panels will be purchased
from Solar Modules Limburg, which is a local developer, thus providing
more jobs in the region. A more detailed overview of this future
alliance, supplier and network stakeholders can be found in appendix 14.
42
Figure 12.2: Implementation of corporations in the future
January 2011 To merge, it is important to know what the main issues are in the
negotiations and what each other strengths are. Coniuratio will enter into
negotiations with several financial healthy, reliable and stable housing
associations which are active in Parkstad. Coniuratio itself thinks
very environmental friendly and is specialized in elderly people.
Coniuratio expects that the merger candidate will go on with this and can
add their strengths, hopefully resulting in a win/win situation.
In general, the first important benefit of proceeding merger negotiations
is the possibility to expand expertise and reputation regarding social
facilities and elderly care. The second important benefit is the possibility to
improve the financial stability.
Stakeholders
Merger considerations and negotiations
Coniuratio had a relatively limited market share and the financial position
will decrease the next few years. Great investments and decisions have to be
made to counteract the shrink, and decrease the vacancy. Coniuratio means
collaboration in Latin, this could be the ‘magic word’ for the next coming years.
43
Policy paper 44
January 2011 Coniuratio enters an unpredictable time in the economical and demographical shrinking region Parkstad Limburg. Coniuratio wants to offer
the best for their customers and their living environment, and by staying
financial healthy. Maintaining social services and reduce the vacancy in
Coniuratio’s operating districts is the main strategy for the next 10 years.
Coniuratio keeps, by collaborating with stakeholders, a close watch on the
market and social developments in Parkstad. By living up to its policies
Coniuratio desires to achieve their goals, and are confident about the future. The executive board of Coniuratio,
Eindhoven, 6 January 2011,
Ruud Coppens
Lars van Doorn
Marco van der Spank
Closing remarks
13. Closing Remarks
45
Policy paper 46
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PARKSTAD 5. Heerlen: Parkstad Limburg.
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•
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Rosenberg, F., Wever, E., Leidelmeijer, K., Iersel, J. van, Schulenberg,
R., Wildt, R. de … Luijkx, Th., (2010). MKBA Herstructureringsaanpak
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Vastgoedrecht, 2008-5
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Limburg 2009. Maastricht: E,til BV.
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Parkstad Limburg 2009. Maastricht: E,til BV.
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Resources
8. Resources
47
Policy paper 48
January 2011 Appendix
Appendix 1; total overview portfolio
Appendix 2; energy and living costs
Appendix 3; sales owner-occupied-sector
Appendix 4; competitors overview
Appendix 6; development plan Terwinselen
Appendix 7; balance 2011
Appendix 8; mutations best case scenario
Appendix 9; costs and revenues best case scenario
Appendix 10; mutations worst case scenario
Appendix
Appendix
Appendix 5; risk checklist
Appendix 11; costs and revenues worst case scenario
Appendix 12; balances worst and best case scenario
Appendix 13; network coniuratio now
Appendix 14; network coniuratio future
49
January 2011

Policy paper

Transcription

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