UKREiiF one month on – bridging the gap from capital to delivery

There is a growing consensus that the UK is in touching distance of the solution, and the challenge now comes down to taking the leap and delivering.

Financial capital is present - from both public and private sources

Across sessions and side conversations, it was clear that the UK has no shortage of capital. The issue is converting that ambition into projects that are credible and investable.

• The National Housing Bank was launched as a division of Homes England, with increased flexibility and delegations around its core product offering of equity, debt and guarantees - this brought significant excitement to the conference agenda across the week
• The National Wealth Fund had a significant presence at the conference and was keen to showcase its investments
• Private sector investors were present and some deals were announced - including joint ventures in build-to-rent, regeneration funding commitments from institutional capital, and further backing for regional innovation clusters linked to transport and infrastructure.

Where pipelines are inconsistent or risk allocation unclear, this capital is unlikely to be forthcoming. Where projects are structured clearly - with stable pipelines, disciplined governance and robust financial forecasts - investment is more likely to follow. This certainty is necessary to provide the appetite for a softening of return targets in exchange for long-term, stable cashflows. NISTA’s infrastructure pipeline is a positive step forward and improving with each iteration, but it has some way to go before it lights a path to delivery for its projects.

This shows that the UK does not need to ‘find’ capital but provide it with the necessary delivery credibility.

A renewed focus on partnership models is emerging

One of the most notable threads at UKREiiF was the continued discussion on PPP and PFI-style delivery models. This conversation has barely moved on in the last couple of UKREiiF iterations but may have picked up a notch since the conference - with recent reporting suggesting that Rachel Reeves is actively exploring how a modern form of private finance could support large-scale infrastructure and housing delivery, particularly in new towns. Lessons from the past must be learned from PFI, but the PPP structure still provides a blueprint for delivery at scale and continues to be deployed internationally with success.

The focus of the NHB supports this view. It will not be deploying public capital in the traditional sense to close viability gaps for projects via grant but will operate more commercially to open up markets which otherwise may struggle and crowd in private capital to seek a blended approach wherever possible.

This aligns with a broader policy direction focused on crowding in private capital, particularly where public finances are constrained and delivery ambition remains high.

Place is becoming the organising principle for investible projects

The strongest sessions at UKREiiF illustrated how infrastructure, housing, innovation and transport are converging around specific geographies, from HS2 growth corridors to innovation districts and station-led regeneration.

We attended sessions covering East Midlands sport cluster, regeneration at Euston, the North East Combined Authority’s investment strategy, West Midlands growth corridors and innovation-led clusters in the Oxford–Cambridge and West London geographies.

This agenda was reinforced through the successful launch of our guide on placemaking and station delivery at UKREiiF alongside the Rail Industry Association, which highlights the role of stations as catalysts for regeneration and long-term economic growth. Such models will be necessary to harness available funding in ‘hotspot’ towns and regions, ensuring that the greatest inclusive economic benefit can be realised. Ultimately, it is the positive changes to place that creates the excitement and confidence needed to unlock investments and accelerate developments.

How can we bridge the gap from capital to delivery? 

UKREiiF continues to provide a unique window into how policy, finance and delivery intersect.

One moment that captured this was seeing Rachel Reeves in conversation with Baroness Ford, Chair of Gatwick Airport– symbolic of the joined up working between government and private infrastructure leadership that will be required to unlock delivery at scale.

While evidence at UKREiiF shows we can tick off many of the key ingredients for delivery - accessible finance, clearer regional strategies and pipelines, and increasingly standardised frameworks and models for delivery - the challenge now lies for all parties in joining these components into a functioning system that is investable and repeatable.

That requires not just confidence, but commitment:

• from government to provide long-term policy stability;
• from the market that pipelines will convert into delivery;
• across both that risk is being allocated in a way that is realistic, transparent and sustainable.

The intersection of policy, finance and delivery is not new to us at Grant Thornton - we have led large scale programmes with central government, local authorities and ALBs, alongside supporting funding distribution for devolved authorities and private sector businesses, and resolved issues related to viability and risk management to unlock successful delivery.

For more information about these examples, and to discuss the projects you need unlocking, please contact Wayne Butcher and Ollie Fyfe.