Landreadjustment What is?

From MIT Course

Land readjustment generally refers
to a process in which a group of neighboring land owners
and occupants combine their land parcels together
for unified planning, servicing, and redevelopment.
This approach gives affected residents in a redevelopment
district the power, by super majority vote,
to approve or disapprove the assembly or transfer
of property to a government agency, or self-organized body,
for redevelopment.

In return, the agency promises to give
each participating resident a land
site of at least equal value in the vicinity
of the original site upon the completion of the project.
With the reconfiguration of the land lots into sizes and shapes
according to a detailed plan guided by master planning,
land redevelopment can be carried out comprehensively.
This method, if designed and implemented properly,
will not require the agency to have substantial upfront
capital for buying out existing residents or government
assistance to acquire land compulsorily.

Many countries, such as Germany and Japan,
started off using land readjustment
to consolidate fragmented farmlands for mechanization
and irrigation improvements so as
to enhance agrarian efficiency.
Farmland boundaries were reorganized
to make space for roads, and irrigation,
and drainage systems.

Gradually, as the economies of these countries
shifted to industrial and commercial bases,
land readjustment was then employed
to facilitate peri-urbanization.
As residential, industrial, and commercial activities expanded,
farmlands at the city fringes were in demand for conversion
into urban plots.
In some cases, fragmented and small agricultural plots
made rural land assembly difficult. More importantly,
some farmers resisted selling their lands
to urban developers, because they
wanted to continue their agricultural occupation.
There were also disputes over the distribution
of land value increments generated
by rural to urban conversion.
These problems remain in today’s developing countries.
As we will explain later, land readjustment
appears to be a viable instrument
for solving these issues.

To conceptualize the idea, let’s say
that there are five land owners in a neighborhood, all of whom
are willing to participate in a land readjustment scheme.
Let’s also assume that the project
is initiated by the municipality that will be
in charge of the redevelopment.
The first step is for the municipality
to assemble land from land owners for re-parceling.
This can be done in two ways.
First, the land owners can transfer their land titles
to the municipality in return for another parcel of land
as close as possible to the original location
after the project is completed.
This method is normally referred to as land pooling.
Second, land owners can also temporarily surrender
their land rights to the municipality
and allow it to re-subdivide their lands to accommodate
putting in wider roads and local infrastructure,
as shown in the diagram.
This method does not involve in the legal transfer of titles
and is usually referred to as land readjustment.
In this course, we will use these terms interchangeably.

Regardless of which approaches are used,
land owners may have to be relocated to temporary housing
accommodations before they can move back to the neighborhood
after their land plots are readjusted.
Taking owner C as an example, the size of their land
will be reduced due to the need to find land space for widening
the roads and to reserve land space for public facilities
or for sale to recover part of the development costs.
Although the land parcel is smaller, owner C is by no means
worse off, because the serviced land will have a higher land value than it had before redevelopment.
This is a win-win situation in which the municipality can
upgrade the neighborhood by providing residents
with better local services and amenities,
and the land owners can enjoy better living conditions
and an increase in the value of their real asset.
Most importantly, planning objectives
can be achieved without exercising the government’s
power of eminent domain, rendering
the process less controversial.
Because owners are willing to accept the readjusted land
as compensation, this land assembly approach
also does not require the municipality
to raise a huge sum of upfront capital
to conduct land redevelopment.
A unique feature of land readjustment
is its built in participatory and inclusive decision making
In most countries, the approval of a private land readjustment
project must have the consent of the super majority of land
owners, and a co-operative or community corporation
will be established to manage the design and implementation
of the project.
In brief, community engagements in this undertaking
are usually intense.
This opens opportunities for private land owners,
public officials, and other stakeholders
to learn to act collectively in a democratic manner
to deal with urbanization issues.