Investment in offices and leisure is driving development in Belfast, as the city’s property sector looks to become more outward facing.
“In 2023 Belfast is combining forces with Derry to bid for the European City of Culture and we are also bidding for the Rugby World Cup,” said David Gavaghan, chair of the Central Business District in Northern Ireland, and founder of Aurora Prime Real Estate Fund.
“We recognise in a post-Brexit world we also need to be more focused on how we join our forces with Dublin.”
While many cities around the UK have a lack of development sites within the city centre, Belfast’s unique history has meant that prime sites have lain vacant for years. Now, as the Northern Irish capital welcomes almost two decades of peace following the political and economic turmoil that came with The Troubles, opportunity is rife for the city to promote its brand.
Furthermore, while the Brexit vote in June threw the sector into relative uncertainty, Belfast is well-placed to reap the benefits of prospects opening up for its neighbour, Dublin, which could now become the only native English-speaking capital city in the EU.
Nuala Gallagher, city centre development director, Belfast City Council said: “We are extremely ambitious and believe we can attract another £1bn of real estate investment, including new offices, hotels and leisure, and retail developments.”
The development drive has been highlighted by the raft of announcements for new schemes this month.
Plans have been unveiled for a £400m riverfront district on one of Belfast’s largest development sites at Sirocco Quays. Swinford (Sirocco) Ltd’s proposed regeneration of the 16-acre site, which formerly housed Sirocco Engineering Works, will include 740,000 sq ft of offices, 815 homes and leisure facilities, including a hotel, restaurants and shops. A pedestrian footbridge will create access from the Waterfront Hall and connect the site to the city.
Richland Group has unveiled updated plans for One Bankmore Square, a 250,000 sq ft, £65m office scheme at the Movie House cinema site in Belfast City Centre.
Titanic Quarter Ltd and Belfast Harbour have also announced the £26.5m Olympic House, a 148,000 sq ft speculative office development.
As part of the Belfast Agenda, the council has set a target of 1.5 million sq ft of grade-A space being delivered by 2021.
Gavaghan said rents were now reaching a point, at £22 sq ft, up from £13 five years ago, where speculative development could be justified.
He added: “Also, in the last few years, the real driver for occupation in Belfast has been public sector driven but they have stepped back. We now have a track record of delivery from big private occupiers. Belfast is not a back office call centre any more but front end location with cutting edge technology.”
According to Gallagher, Belfast is now the top city in the world for US cyber investment and has the second fastest growing knowledge economy three years in a row.
Gary McCausland of Richland Group added: “We have a fantastic workforce with a high level of good education and corporation tax is also coming down to 12.5% next year, which is an incentive for occupiers to make Belfast their home.”
But as well as a skilled talent pool and Europe’s fastest direct fibre optic link to North America, lack of supply is also driving increased demand for grade A office space, James Eyre, Titanic Quarter Ltd’s commercial director, explained.
“At present there’s only around 200,000 sq ft available in small lots spread across a number of buildings. Prospective occupiers, however, are looking for good sized floor plates and scale.” he said.
While Deloitte’s first Crane Survey for the city – which was launched in January this year – forecast increased planning applications being submitted this year, the development isn’t just focused on office-dominated schemes.
Worldwide recognition for Titanic Studios, the place where epic fantasy series Game of Thrones is filmed, has helped to make Belfast a major tourist attraction.
Hugo Fitzgerald of Broadway Malyan, which is designing Sirocco Quays, said: “You can’t deny the series has brought a lot of focus to Belfast, even in the amount of cruise ships that are coming into city.”
This is something that the city council is looking to capitalise on. It has an ambition to double tourism revenues (from £483m in 2013) by 2020 and has set a target to deliver 2,500 new hotel bedrooms, built by 2021.
There are a more than 1,000 hotel bedrooms currently under construction, which will push the total number of hotel rooms in Belfast to more than 5,000.
So far this year, Signature Living has announced a commitment to develop as many as five further hotels in the city, including the restoration of Crumlin Road Courthouse into a luxury hotel and the development of a George Best-themed hotel.
The relocation of the University of Ulster’s primary campus from Jordanstown to Belfast, which will bring 12,500 students into the city centre by 2019, is driving more growth in the education sector – with almost 2,500 student beds across six developments under construction.
Residential is also coming on stream, catalysed by the Sirocco Quays site.
Swinford’s Phil Silk said: “Our plans for 815 new homes are the largest residential development in the city centre. It will include a mix of private, rental, social and affordable accommodation.”
Belfast City Council has also been praised for working with the private sector to promote the city locally and overseas.
McCausland said: “One massive step forward is Belfast City Council, which has been incredibly supportive of property development. It understands new buildings create jobs and attract countries to invest here.”
Belfast City Council chief executive Suzanne Wiley expressed a desire to speculatively build developments, saying the council had its own finance available.
“It would be good if we could work collectively across all different sectors and make strategic decisions about how to intervene when the market isn’t doing it for itself.”
But the recent Northern Irish election and conservative bank lending could be challenging to development.
McCausland said: “We have a political scenario that needs firming up. The leaders of northern Ireland need to start putting business first. It is also hard to do a speculative office scheme if banks are not funding and we will need some type of financial help. Banks and investors are still relatively nervous of Northern Ireland.”
Despite this, things seem to be looking up for the city. Gavaghan said: “Five years ago, because we didn’t believe in ourselves, our proposition was different. But now we have household names like Deloitte and KPMG as well as small businesses focusing on cyber security. All of these people are beginning to tell their story worldwide but there is a story that goes beyond that.
“We are not complacent; we are big enough to matter but small enough to care.”
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