Within these walls
Nobody drives through the massive, black wrought iron gates without a permit and those on foot need a prior invitation. The postman never penetrates the barricaded entrance, which is manned 24 hours a day by uniformed security officials. Even the pizza delivery boy must be on the guest list and, once admitted, CCTV cameras track his progress around the seven-acre site. There is no doubt that Bow Quarter, a gated community in London’s East End, is a secure environment. And, in a market beset by plunging property prices, some buyers think it is also a safer place for their money.
London landlord and interior designer Luke Doonan has bought 10 apartments in the development over the past 12 months and says values are holding up well. “Two minutes away, the new developments on the other side of the wall have dropped in value between 15 per cent and 20 per cent. Inside Bow Quarter, they’ve come down but more like between 5 and 10 per cent.” (The average price of a typical house in the UK has meanwhile dropped 16.6 per cent, or £150,501, during the past year, according to the Nationwide building society.)
Life behind walls has never been so popular. In the past 15 years, ever more square footage has been annexed and “forted up”, as gated residential developments gain ground in South America, South Africa, India, China, Australia, the UK and particularly the US. A Royal Institution of Chartered Surveyors’ study of the phenomenon in 2006, Building Balanced Communities, reported that in the US, “gated communities ... account for 80 per cent of all new development”. Already 6 per cent of US residences are in such enclaves, according to the latest research by Dr Rowland Atkinson, director of the Housing and Community Research Unit at the University of Tasmania and joint author of a seminal 2003 study on the phenomenon. And, he says, other countries are catching up. The UK has, for example, more than 1,000 such developments and they are “growing at a steady rate”.
There is less comprehensive research on property values in gated communities but estate agents are full of anecdotes. Alex Newall of Knight Frank in the UK has tracked values in two famous Surrey, southern England, golf estates – St George’s Hill and Wentworth – and says market slowdowns have a relatively mild effect on them. At St George’s Hill, the best properties were commanding about £1,000 per sq ft in 2007 and, though prices for less desirable properties have fallen, when it comes to “best in class” houses, “there is still a shortage [so] a number of sales have been achieved ‘off market’ at premium figures, similar to those at the peak”. At Harefield Farm, a gated luxury conversion of agricultural buildings in Wilmslow, Cheshire, north-west England, that has attracted the attention of premiership footballers, homes are meanwhile still selling at or close to their spring 2008 launch prices of £625,000-£1.2m.
Ralph Bowden, a property consultant who publishes the regular survey Bowden’s Market Barometer, says it is a similar story in the US, although there are caveats. “It has been my experience over the past three decades that master-planned communities fare better in troubled times but it’s all about location,” he explains. So, while the abundance of golf communities in Orlando, Florida means that the homes in them are now discounted by 20-30 per cent, “in places like Aspen, where it is virtually impossible to create an oversupply [of gated residences], prices do not move downward much”.
There’s far more to this worldwide enthusiasm for enclave-dwelling than the drive to acquire a property apparently immune from dropping in value, however. Most buyers are responding to three ingredients they deem key to a happy residential existence: security, privacy and prestige. And in every country, the gated community recipe has been adapted to reflect local needs.
In South America, for example, the threat of violent crime played a big role through the 1990s in the creation of virtual citadels with their own power supply, sanitation and security, while similar fortress developments were built in post-apartheid South Africa in response to an escalating threat of racial violence.
In China and India, where explosive economic growth has created a new elite, the trend is toward self-contained suburban retreats for the recently wealthy, designed to display their success and keep them separate from the dangers and irritations of their less affluent neighbours. In the “luxury villa” areas in the outskirts of Beijing and the prestigious developments near the Hongqiao airport in Shanghai, for example, there are developments known as “golden ghettos”, some of which feature whimsically exotic and ostentatious architecture, including facsimiles of Californian townhouses (as seen in Orange County, Beijing) and French chateau-style dwellings (in the Fontainebleau project, Shanghai). In India, numerous smart, contemporary compounds have been built to segregate upper-class families from the country’s chaos, poverty, power cuts and water shortages.
In the US, by contrast, gated developments are designed not so much to keep the world at bay as to create a model village within. Known as master-planned communities, they are sprawling complexes with facilities ranging from tennis courts and golf courses to shops, hospitals and schools. The idea is to create close-knit, sociable places. “It’s so nice from a social point of view,” says Diana Falletta, a Briton who moved to The Georgia Club, Georgia, with her American husband, Carl, last year. “The people are without exception supportive and friendly. Here, you quickly become part of the community.”
Wayne Wall, who works in commercial real estate, moved to a gated community at Vero Beach, Florida, just over two years ago with his interior designer wife, Maggie, and says he feels the same. “We’re not here because of security; it’s pretty safe area round here. We’re here because of the lifestyle.”
Lil Miller-Fox, who sells homes in master-planned communities in the US, thinks their popularity – and price resiliency in down markets, assuming no oversupply – stems from their liveability. “In the US, cities and towns have gotten away from traditional planning and design principles that are necessary to create and retain great places to live in,” she says. “Today, it’s the private developers who are creating attractive, well-designed communities.”
Some UK developments have a similar model to those in the US but many, including those on the Surrey golf estates, the developments in Cheshire, the collection of secure new-builds in King’s Cross, London, and the plush conversions in Kensington and Chelsea, are targeting a different market, with properties sold to globe-trotting buyers for use as second or third homes.
Richard Sharples of London-based buying agency Property Vision says he typically advises international clients to consider gated developments because they are the only options that meet their specifications for security and privacy. “They fly through for business but they aren’t here much of the time,” he explains. “They want a property where they can just lock the door and walk away.”
With those sort of buyers in mind, Northacre is developing The Lancasters on Bayswater Road overlooking Hyde Park. When the 77 apartments are available in 2010, residents will drive through private gardens to a main gate, where their cars will be valet-parked. But, says John Hunter, Northacre chief executive, the development won’t look like a fortress. “The perimeter isn’t wall-like. It’s railings and a gate that maintains visual permeability without allowing physical permeability,” he says. “The attraction of gated developments is the appeal of moving your threshold from your front door to your front gate – the security that brings.”
Developing community is another matter. Novelist Christopher Fowler, who lives in the penthouse of one of the King’s Cross developments, with neighbours including filmmakers, writers, designers and DJs, says he enjoys the idea of being surrounded by like-minded creatives but that life behind the walls is far from lively. “It’s normal for the majority of apartments to be empty much of the time,” he says.
He also worries the societal polarisation – gated and ghetto, secluded and excluded – that is the inevitable product of these developments. “When I moved in I thought: ‘Oh my God, this was one of the things I said I’d never do. Nice English liberal, goes to a state school – all the right values – and suddenly you find yourself behind a barrier, separating us and them,” he says.
The fear is that the physical and social detachment of the affluent has bad consequences for the rest of society. There are a few studies that take a more upbeat view – 2005’s Gated Communities as Club Goods: Segregation or Social Cohesion by Bill Smith-Bowers and Tony Manzi, which extols the benefits of creating safe pockets for affluent buyers in poorer areas; and 2002’s Gated Communities in the Metropolitan Area of Buenos Aires: A Challenge for Town Planning by Guy Thuillier, which showed that the retailers, hotels, offices and private schools that sprung up to serve the residents of developments in Pilar, Argentina, brought economic benefits to the proximate poor. But theirs is the minority view.
The more general consensus is that gated developments bring division and fail to “spread the wealth”. In the US, for example, some gated communities don’t use local services such as refuse disposal and policing and so are now opting out of local taxation altogether, withdrawing funds and undermining local democracy. In the UK’s posh lock-up-and-leave developments, residents might be subject to vandalism or crank calls on their high-tech video entry phones.
Sometimes, communities counter the criticism by developing philanthropic programmes. At Huntsman Springs, an estate with golf, skiing, fishing, horse-riding, restaurants, retailers and 650 family homes protected by a 24-hour roaming security team in Teton Valley, Idaho, the developer is planning to donate a portion of profits to cancer research when work is finished in 2011. And, at Vero Beach, Wall and other residents volunteer at a local scheme to build housing for the needy.
Moral ambivalence aside, for buyers worldwide, the pros of gated communities continue to outweight the cons; building progresses on every continent. And in the downturn, according to residents, investors and estate agents, the best developments could be safe havens. “Bow Quarter is special,” Doonan says. “It includes historic buildings like the 19th-century match factory. There is a restaurant and gym on site. It’s a proper community – really friendly. And the security is fantastic.”
14 February 2009