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Get ready for the renaissance of the region
9:30am Friday 31st August 2012
I am sure we have all enjoyed the Olympics and the excellent performance from Team GB, there is always going to be a lot of speculation and debate about the cost but the Olympics and the Jubilee means the UK has been seen around the world in a very positive light. There is always the debate about it only benefiting London, Well here is some news for all you sceptics.
In Birmingham, Manchester, Liverpool and Leeds, there is a much fairer wind blowing through these city economies than the media would have you believe. Negative media has led to negative market sentiment and, as a result, the difference between office yields in London and elsewhere is the widest ever known. But despite this demand in the regional property markets is greater than it has been for some time.
So where is the growth coming from? The main factors are an increase in “onshoring” & “northshoring”. Cost increases and service concerns have led to large corporates bringing service & call centers back to the UK, with regional cities as their destination. They are cost-effective places to locate, plus the availability of good-quality staff means service standards and customer satisfaction can be improved. Deutsche Bank has recently moved investment banking jobs up from London to Birmingham. Many banks had put on hold their planned moves because of the financial crisis, but have now started to reconsider again because the expense of London for both property and people. Another example is one of India’s biggest outsourcing companies, Aegis, has recently created 600 jobs at its new European headquarters.
So get ready for the renaissance of the region: over the last 20 years, our regional cities have had to completely restructure their economies but, having done so, they are now poised to become some of the best places in the UK to support the businesses of the future.
As a result of this total office occupancy costs across the West Midlands have remained stable in the first half of 2012 and headline rents remained stable in the region. Also new research is showing that residential development land values are rising slowly but steadily, West Midlands has seen a significant resurgence in demand from the mainstream house builders for allocated sites where there is certainty of delivery.
This is all being supported by local projects to help businesses and infrastructure such as in Kidderminster where the secretary of state has confirmed his support for the South Kidderminster Enterprise Park which means Wyre Forest District Council can now offer a simplified planning process within a designated area to speed up the planning process, this to encourage businesses to locate in the area and for existing businesses to expand their operations.
Then there is the regeneration of Dudley's iconic Castle Hill after proposals for a 1,000-space visitor car park was given the green light for funding. This will kick-start the development of a major project to create one single visitor entrance to Dudley Zoological Gardens, Black Country Living Museum and Dudley Canal Trust. It is anticipated the site expansion and additional visitor numbers will create 480 new jobs on the site. The new car park forms part of a wider regeneration scheme set to transform Castle Hill. The plans will almost double visitor numbers to Dudley's major tourists attractions to over one million people each year, create jobs and improve the local economy.
We should not only feel proud of Team GB after their performance at the Olympic but the whole of the UK and our local region for driving us forward and we look forward to more success with the Paralympics.
SONYA TAYLOR, chartered surveyor and valuer, Walton & Hipkiss, Stourbridge