REITs back Conservative property plan

LONDON (Reuters) - A slew of Britain's biggest real estate investors have backed a plan put forward by the Conservative Party to improve the planning system, kickstart housebuilding and promote local community development.

Land Securities, British Land, Grainger and pension fund Hermes have welcomed the Conservatives' proposals to give local authorities greater decision-making power and extra funds equal to tax income generated by newly built homes and commercial property in their jurisdictions.

They hope this policy, known as localism, will incentivise councils to streamline planning processes and encourage development, which could relieve the national housing shortage and help property firms grow their portfolios.

"Removing burdens to development and growth has to be near the top of the agenda whoever wins the next election," said British Land Chief Executive Chris Grigg.

"The benefits of commercial property can be seen in the thousands of jobs created and communities re-shaped over the last few years. Low interest rates and a cheap pound make the UK a great investment proposal and it is vital that we do not let outdated planning laws hinder recovery," he said.

In its "Making Localism Deliver" report on Monday, the British Property Federation (BPF) has also recommended changes to Stamp Duty Land Tax to encourage institutions to fund professionally managed rental developments.

"If done properly, localism could mean a smoother planning process, quicker decision-making and better engagement. The property industry is committed to working closely with councils, but they will have to be given significant support to make this work," Liz Peace, chief executive of the BPF, said.

Andrew Pratt, managing director for development at Grainger, the UK's largest quoted residential landlord, said the Conservatives have a real opportunity to unlock billions of pounds of new funding if they can support changes to the way stamp duty is charged on bulk purchases of homes.

"Any new administration will be judged in years to come on the number of housing starts and with home ownership still not an option for millions, ushering in professionally managed, quality rental homes could be the radical hallmark to truly make a difference," Pratt said.

(Reporting by Sinead Cruise; Editing by Rupert Winchester)