An eight-storey building in the heart of Manchester has provided an early test for devolution. In an encouraging victory, town hall has trumped Whitehall. Long may that continue.
This government has done better than all others before it in challenging the assumption that politicians only believe in devolution in opposition. From delivering a landmark package of devolved powers 15 months ago, to putting its shoulder behind the northern powerhouse throughout 2015, there has been a meaningful shift in accepted wisdom. It was inevitable tests would follow. One duly arrived this week.
Federation House, on the southern edge of the Co-operative and Hermes’ NOMA development in Manchester city centre, was named in the March 2015 Budget as the chosen location for a new tech hub. The 87,500 sq ft block had been earmarked for a start-up incubator project led by Doug Ward’s SpacePortX. Supported by a £4m grant from George Osborne, it would have been the first prelet on the 4m sq ft NOMA scheme.
However, this week the city council decided to review the hub’s location. Leader Sir Richard Leese will hope resistance is fertile. “We remain confident of delivering a project of significant value to the tech community,” he says.
He might come to believe that a better location is Bruntwood and Select Property Group’s Circle Square neighbourhood. The 2.2m sq ft Oxford Road Corridor scheme has been marketed as a “new community for business, science and innovation”.
Or he may opt for Allied London’s St John’s neighbourhood, where a 25-acre masterplan backed by the council is targeting the creative industries, start-ups and collaborative working.
Taking a bold stance against one’s own paymasters is easier in a market which has had a bumper 12 months. Manchester’s active office occupier market has meant prime rents have hit £34 per sq ft and only 77,756 sq ft of grade-A space is currently available (p28).
Encouragingly, Whitehall appears accepting of the challenge to its authority. A spokesman in the Department of Culture, Media & Sport says the council is able to determine the location “to successfully deliver its benefits to the local digital business community”. So far, so lovey dovey. And so refreshing. But bigger tests may come.
ν A new columnist joins EG this week, Nick Leslau. An investor widely credited with calling the last cycle, today Leslau warns of a plethora of “bull-market spreadsheet junkies” and a dearth of “experienced” property types equipped for “the next demanding stretch of the cycle” (p58).
“Life is becoming more interesting,” he writes. “Brace yourselves.” Ominous.
ν Ian Coull, who passed away in the early hours of Thursday morning at the unfairly youthful age of 65, was one of the most respected and best liked figures in the industry. The former SEGRO chief executive (and much else besides) was also among the most decorated. He received the EG Outstanding Contribution to Property Award in 2010 and just last November was presented with a special award at the British Property Federation annual dinner. He was clearly unwell that evening but made time for what was often a queue of well-wishers lining up at the top table. Since retiring from SEGRO in 2011 and until ill health forced him to stand down last year, he had been one of this industry’s most in-demand non-execs. For good reason: his charm, humour, expertise and judgment will be missed.
ν Searching for property data becomes a whole lot easier this week with the launch of EGi INSiGHT. In one quick search you can aggregate data for cities, regions and postcodes by whatever measure you choose: from average rent per sq ft to availability, average yield and movement over the last five years. It will inform investment decisions and speed up the production of pitch documents. Use your EGi log-in to access the service at wordpress.egi.co.uk/insight and do send feedback to tom.pilkington@estatesgazette.com
