The East Midlands Development Agency is dying a lingering death. Like its counterparts across England, it is being slowly wound down before its official abolition in March 2012. But its demise has already created a hiatus. Decisions on development and regeneration have been put on hold as the property sector waits to discover what will follow in EMDA’s footsteps and, crucially, what funding will be available.
Views on its performance over the past decade differ widely among property professionals, ranging from it being a flabby, bureaucratic machine, to an agency that successfully drove the region forward. It is clear, however, that the quango will leave a lasting physical legacy, not least in the region’s key cities of Nottingham, Leicester and Derby. For instance, the agency’s influence, funding and partnership helped to secure the development of retail and office areas, Westfield Derby and Pride Park.
Through its investments in land and pump-priming developments, EMDA has played a role in attracting hi-tech businesses to the region’s traditional manufacturing economy. Nottingham’s BioCity, which provides funding, labs and support to new businesses, and Leicester Science Park have between them received almost £16m in EMDA funds.
The latter, which is being constructed on derelict land, will provide 25,000 sq ft of office space, while the agency claims that BioCity has enabled 57 knowledge-based companies to set up.
Development arm
Nottingham Science Park, which is also EMDA-funded, is home to Toyota and Chinese car manufacturer Changan, which has established its European research and development arm on the park.
EMDA aims to continue its R&D legacy well after its demise using the UK’s first urban development fund, which it set up earlier this year. The fund, now being managed by King Sturge, has £5m from EMDA and £10m in EU finance to invest in commercial property for the science, technology and innovation sectors. It will provide capital investment through equity, loans and rental guarantees, and will work alongside conventional forms of finance.
The fund expects its investment to be returned, complete with a profit, creating recyclable finance and a potential ongoing stream of capital for the next 10 years.
Matthew Smith, partner at King Sturge in Nottingham, says that EMDA has often been innovative and forward-thinking in its approach. As well as the urban development fund, he cites Blueprint, its sustainable property development company, as an example.
The company, a joint venture with the Homes and Communities Agency and Igloo, managed by Aviva Investors, leads property-led regeneration throughout the region, and has been able to lever in significant private investment through its partners. It is responsible for Nottingham Science Park, one of the biggest schemes in the region; Green Street, a sustainable housing scheme; and Phoenix Square in Leicester, a mixed-use development.
“Blueprint would not have been set up if EMDA didn’t have the vision,” says Tim Garratt, director of asset management at regional agent Innes England.
But EMDA’s greatest legacy will probably be the regeneration of Nottingham’s and Derbyshire’s former coalfields, the scale of which would not have been achieved without a co-ordinated regional drive.
More than £500m in public and private funds have been invested into the 26 sites in the East Midlands coalfield programme over the past 10 years. The HCA estimates that the programme has created 830 homes and more than 300,000 sq ft of employment space, as well as regenerating outlying communities left devastated by the demise of the mining industry (see box).
Some in the region will mourn the loss of the agency’s expertise and its influence. “EMDA’s knowledge base is phenomenal. To lose all that is bordering on criminal,” says Garratt. He warns that city-based Local Enterprise Partnerships are too parochial to see the region’s “bigger picture” and meet its challenges.
However, it is not necessarily the end of EMDA that is causing widespread despondency, but the end of its budget. One senior regeneration professional, who did not want to be named, says that EMDA may have “spread its jam too thinly and wasn’t ambitious enough”. However, he says it provided “much needed capital”, adding: “Regeneration is much lower on the agenda for this government and we won’t have the investment. We already have a vacuum in the region, and many projects just won’t get off the ground.”
Margaret Allen, regional director of the HCA, says that the partnership with EMDA was highly complementary, allowing the two to tackle housing, infrastructure and job creation as “complete places”, and she will now have to work with entirely different partners.
So far, up to eight LEPs across the region have put in bids (see table below), and some of the fiery negotiations highlight the competitive nature of the East Midlands. The challenge for the LEPs will be securing finance from the £1bn regional growth fund.
Allen says that the HCA has already begun working with local authorities to draw up funding plans. “Our challenge will be breaking the region down into separate areas and working out what’s important for that area,” she says. “If boundaries are not important anymore, the whole definition changes.”
The government will outline the structure of LEPs and their responsibilities in October, with no guarantees that all the bids will be successful.
Major coalfield projects
The Avenue – Wingerworth, Derbyshire £172.3m total investment
Remediation of one of the most contaminated sites in Europe
Pleasley Colliery – £7.2m total investment
Major remediation work plus creation of Pleasley Pit Country Park
Shirebrook Colliery – £38m total investment
96 acres of development land
1,100 homes
LEP bids submitted to date
Greater Lincolnshire Lincolnshire county council, north-east Lincolnshire council and North Lincolnshire council
Leicester and Leicestershire Leicestershire county council and Leicester city council
Northamptonshire Northamptonshire county council
Nottingham, Nottinghamshire, Derby and Derbyshire Derbyshire county council, Nottinghamshire county council, Derby city council and Nottingham city council
Sheffield City-Region Bassetlaw district council, Bolsover district council, Chesterfield borough council, Derbyshire Dales district council and north-east Derbyshire district council
South-east Midlands Bedford, Central Bedfordshire, Luton and Milton Keynes councils, Aylesbury Vale district council, Cherwell district council, the boroughs of Northampton, Kettering and Corby, and the districts of South Northamptonshire and Daventry
Peak District and West Leicestershire & Northern Warwickshire have both put responses in on cross-border working and could be potential LEPs.
