How can we value land holistically?
I attended the International Greenbelt conference in Toronto in March. It was an interesting perspective on greenbelts, from citys examples in Melbourne and San Francisco to national approaches in England and Germany.
One session seemed particularly relevant to how we look at land and its development potential, an interest I have developed over the years. A range of speakers discussed the value of land and its relationship to the greenbelt. Some talked about the general social and ecological value of land (as local communities refocus how they inhabit and benefit from green spaces in Brazil), while others highlighted ways to identify the precise value of natural services provided by nature (as attempted in the North West of England and in Poland).
While the former highlighted the intangibles within our financial world where continuing consumption and growing gross domestic product demonstrate growth, the latter tried to reconcile this gap. In doing so, there was a focus on trying to monetise the services provided by nature. In a university study – still continuing – a monetary value was placed on the overall undeveloped land surrounding a settlement. It considered a wide range of natural services, including pollination of plants, cleansing of water, carbon capture, biodiversity, etc. And through this process and dollar amount was given per each hectare.
I was baffled. How could each hectare be equal in value? Surely a wetland in the given greenbelt might have more biodiversity and offer more services than adjacent grassland. The model was not sophisticated enough to address this.
More concerning was the fact that each hectare had a price tag now associated with it! From a developer’s perspective, this would simply become an added cost to development. In addition to the purchase price of land, a loss of natural service charge might be added on to overall development costs in the foreseeable future. Job done, the land is valued more holistically, and it is bought and developed just the same.
I truly believe such an approach undermines the true value of our natural landscape. I agree that land should be assessed according to the services it provides, and I believe this is an approach we need to consider further. In doing so, land is considered more valuable in its environmental and social characteristics (today this value generally isn’t considered, and therefore given no value).
However, I don’t think this value should be monetised, but rather its value should be assumed to be the given service. If a developer aims to change (develop) the land, it should be their responsibility to replace the lost services. For example, let’s consider part of the natural service of a given piece of land. There is a wetland, and its value includes the cleaning of water, attenuation of water and supporting local biodiversity. The developer could replace the wetland and its functions naturally. Perhaps this could include creating new wetlands or restoring existing wetlands nearby. Or the developer could also replicate the services through human engineering means with contributing to the construction and management costs of a clean water facility, flood control system and creating new habitats features amongst the proposed buildings on site. The developer could also choose a range of solutions that include both natural and engineered solutions, as they please.
Either way, an overall montetary value is not given to the developer, instead an understanding of the site’s value (its services) needs to be determined. Then the developer would be required to address how they will retain or replace these services at their cost. In doing so, it would be anticipated that less valuable land (in economic, social and environmental terms) would be utilised before more valuable land. In either case, however, overall value will need to be retained, replicated or replaced. Our landscape would be viewed more valuable, and the overall services that it provides would be better respected and enhanced.