What precisely is meant by “hi-tech” and what is the difference between a “business park” and a “science park”?
Hi-tech undoubtedly became one of the property buzz words of the 1980s. Prior to 1980 it was almost unheard of, but, during the course of the past 10 years, it has almost certainly overtaken all other types of industrial development to the point where concern is now being expressed as to the shortage in the supply of the humble shed-type warehouse or industrial unit.
Despite all the interest and publicity, hi-tech remains a very difficult term to define. In the early days it was consistently misapplied to the many developments of brightly coloured, crinkly-tin sheds whose only real claim to be different was the provision of a significantly higher office content than the 10% or so typical of the industrial units, developed in the 1970s. In most cases it seems fair to suggest that such developments were being described by developers as hi-tech as much for marketing reasons as anything else. The genuine hi-tech building is obviously very much more than this. With rental values at well over double the equivalent values of standard industrial units, and land values now reaching £2m per acre, they surely must be!
The standard industrial/warehouse unit can be defined quite simply in terms of the physical attributes of the building. Cheap to build in modern materials, it would consist of a multi-purpose unit which could be used for general light industrial manufacturing or warehousing, offering a large open space with eaves heights up to 18 ft and a small office content of around 10% to 15% for associated administrative functions. Any definition of hi-tech cannot be so straight-forward as it must comprise not only the physical attributes of the building itself but also elements such as location, environment and the occupier. In fact it has been said that the phrase refers more to the nature of the occupier than the building itself. William Cochrane has suggested: “The optimum hi-tech building would be prominently located; a quality product; have excellent parking; ease of access and egress; and a good environment, including landscaping and planting.” Financial Times March 27 1987.
Each of these elements, location and environment, are of critical importance, but equally so is the nature of the user, and it is worth looking at the historical context to establish why this form of development has evolved. It is not simply a fad, designed by developers to inflate the rental values of industrial units, but a response to demand for space from certain types of industry.
Like so many of the new forms of property development, much of the impetus for hi-tech has stemmed from the United States. With the increasing globalisation of markets, and surely with one eye on 1992, the UK has been seen as the ideal entry point for American firms looking to expand into Europe. The same is true of Japanese companies. Their problem, having decided to move into the UK, was an absence of suitable business and manufacturing space when compared with developments in their home countries. These were businesses for whom the traditional industrial estate was unable to provide the necessary space requirements. Furthermore, with the tendency to integrate a range of functions within a single building, it became increasingly necessary to occupy a quality building which, by its very appearance, would project a high-profile corporate image.
With the advent of the silicon chip and the electronics revolution, the nature of industry is changing, with greater emphasis in the developed world on the clean, information technology-orientated industries employing a high-calibre workforce. These are not purely manufacturing operations requiring simple factory space, they are multi-functional organisations which often need to accommodate a number of different uses within the same unit. Increased congestion in urban areas has rendered many business locations inaccessible. The distinction between administration and manufacture, between office and industrial use, is becoming increasingly blurred. Hi-tech development then, is the response to the demand from industry for a significantly different type of operational environment.
B1 business use
Against the background of demand for new types of industrial space, the planning system was found wanting. Unable to take account of the changes taking place, existing definitions of industrial use, based on the pre-electronics era, made it difficult for developers to respond to the needs of the new industries.
Initially, planning authorities were suspicious of hi-tech development proposals, viewing them as back-door attempts to establish a high degree of office use within existing industrial developments or to encroach into the green belt. To some extent this was probably true, but it was clear that there was a need to redefine planning uses.
Class B1 of the Town and Country Planning (Use Classes) Order 1987 now provides a combination of the former separate use classes for offices and light industry as a response to the demand for hi-tech space. The new class refers to “business use”. It is a controversial change which has certainly facilitated the development of hi-tech units but, as has been argued, to the detriment of the provision of standard light industrial units which are said to be in short supply in certain areas of the country. Concern is such that the Secretary of State has recently promised a further review of these aspects of the Order.
So what is unique about hi-tech buildings which distinguishes them from the more traditional forms of modern industrial space?
Location
As ever, location is one of the crucial elements. Hi-tech developments will be located mostly on the outskirts of towns and cities, minimising congestion and giving good access to motorways and dual carriageways. Accessibility though, is not the only factor governing location. These businesses require access to a skilled and highly trained workforce.
Much of the impetus behind demand emanates from American and Japanese companies looking to expand into European markets, which has led to a concentration of development in the South East, especially the so-called “Golden Triangle” to the west of London out towards Heathrow and south down to Crawley and Gatwick Airport, thus benefiting from direct contact with the capital and international communication links. Other major locations will tend to follow the main motorway routes, the “Western Corridor” for example, following the course of the M4 out towards Bristol, taking in locations such as Reading and Swindon on the way. It is notable that one of the first such schemes was Aztec West, just north of Bristol, close to the M4/M5 junction, and one of the larger, Stockley Park, near Heathrow. Although this area represents the greatest concentration of development, shortages of skilled labour are forcing companies to consider other locations, so that developments are now appearing in provincial cities such as Leeds and Manchester.
User
It has been said that hi-tech is more a definition of the occupier than the building itself and, to some extent, this is true. But the requirements of each individual user will be very specific. Even so there are some common factors.
It is necessary to consider the very different needs of modern clean industries, utilising highly sophisticated machinery and information technology, sensitive to dirt and dust, noise and vibration, requiring higher standards and a more efficient and more flexible distribution of services within the building. There is a need to accommodate networked computer systems and their associated cabling, resulting in raised access floors, false ceilings, air-conditioning and improved finishes. The use of space needs to be energy efficient, resulting in lower floor-to-ceiling heights, a high degree of insulation, sealed-unit double-glazing and efficient heating systems. Use of space must also be flexible to accommodate the range of uses; embracing office, research and development, assembly, storage and other uses, as well as the changes which will result from the continuing pace of technological change.
Other space requirements will include the provision of room for expansion, to accommodate industries which are growing, as well as extensive car-parking provision, in some instances up to one space for every employee.
As these buildings are no longer simply manufacturing units, they are required to project a high-profile image so that architectural standards and specification are equally important. The initial visual impact, for example, is now every bit as important as would be the case with a prestige city-centre office.
Environment
Many hi-tech developments have taken place within business parks on greenfield sites; low-rise, low-density landscaped estates. It would be wrong, however, to see this as a glorified industrial estate.
Many business parks are now developing as full-blown business communities with amenities on site including banking, shops, wine bars, hotels, pubs and sporting facilities.
Science parks
Where most of the impetus and finance for hi-tech development comes from the private sector, the science or technology park has developed in response to the need of areas badly damaged by the recession, where it has been necessary to regenerate and diversify into the new generation of industrial uses.
“A science park is a collection of high-technology companies or research institutes situated in attractive surroundings, developed to a low density, engaged in product research and prototype development, close to a tertiary education establishment with which there are significant opportunities for interaction and cross-fertilisation of ideas.” Estates Times May 29 1987.
These are developments of hi-tech units where there is some interaction between the companies in occupation and nearby research institutions, working in areas of novel applications of science and technology — computers, electronics, bio-chemicals and mechanical or environmental engineering. With the public-sector emphasis they are by no means confined to the areas of fastest economic growth — Aston Science Park near Birmingham, for example, is associated both with Aston University and Birmingham City Council and situated in an economically depressed area of the city.
Specialist advice on financial and management issues is often made available by banks and professional organisations and, broadly speaking, they are seeking to create an environment where technological entrepreneurs can start up and grow, where the major requirements will be high-specification premises in an attractive environment at realistic rents, links with a higher education institution or a major centre of research, and an active management presence to provide skills and common services.
Changes in the demand for business space have resulted in very significant alterations to the industrial landscape, but the changing needs of business are also being reflected in differing management policies and institutional preferences. The standard 25-year lease is proving unacceptable to many occupiers whose preference might be for a freehold or ground-leasehold interest or, alternatively, much shorter and more flexible tenancy arrangements for smaller expanding firms. These changes, being demandled, are set to remain a significant feature of the property market.
