department international trade naisha polaine

Demand for Manchester city centre commercial property is at a three-year high, one of the north west’s leading developers has claimed. Speaking at the Greater Manchester Economic Growth Conference John Hughes, Managing Director of Ask Real Estate, said: “Over the last two to three years we never been this scale of requirements in terms of square footage or profile of companies looking to locate into central Manchester or Salford.

And while the earlier Spinningfields development had seen large professional and financial services occupiers move from other parts of the city centre, Manchester and Salford are now attracting businesses from other parts of the region. As an example he used Autotrader magazine who had chosen Manchester when concentrating its 600 staff in one place.

Hughes said there is a further 1m sq ft to deliver over next ten years at Ask’s First St regeneration of the former former Gaythorn gas works, which the company has spent £8m decontaminating. He said Ask has been working with Manchester council to increase the massing of the scheme’s office design while increasing the amount of green space. The next phase of the scheme will feature triple height reception space, ground floor coworking space and 163,000 sq ft of offices on the upper levels.

And while Brexit is a concern, it is not figuring high for the businesses on Ask’s enquiry schedules, Hughes said: “Brexit is not relevant to business critical decisions.”

David Hodgson, Regional Head of Strategic Development at CEG, said the Yorkshire-based developer had raised new funding from Swedish investors since the EU withdrawal vote: “They are keen to continue to invest and we’ve not seen any reticence about looking at opportunities for growth in regional centres. We might get more restiveness as the date approaches but believe there is inherent demand which is not going to evaporate next March.”

He also told delegates that the company has just submitted a planning application for the redevelopment of 20-36 High Street Manchester, which is opposite the Arndale Centre.

Hodgson said CEG hopes to secure consent for by the end of this year for its £79m scheme to regenerate what he described as a “nasty 1970s building not sited to modern occupational requirements.”

Under the plans, which have designed by award-winning FCBStudios and inspired by Sunlight House, it will be replaced by a mixed-use development containing 361 apartments above a double height, glazed ground floor plaza housing 10,000 sq ft of cafés, restaurants and shops. He said the plans also involve creating a new public square ringed by food and beverage outlets, creating a “much needed area of new public realm in Manchester city centre” that would open up new routes between the High Street and the city’s Northern Quarter.

Hodgson said the company had increased both take-up of space and rent levels at its Exchange Station and 196 Deansgate schemes in Liverpool and Manchester. He said that when the buildings had been acquired they were only 35% let, but after undertaking a major refurbishment and installing new management, Deansgate is now nearly fully occupied.

And at Exchange, rents have climbed by £5 per sq ft and the building is now 90% let, Hodgson said: “Active management has really moved things on: the locations and buildings were fundamentally great.”

Hodgson said CEG’s Stakehill industrial estate in the north west is also now fully let, up from 30 to 40% when the company acquired it.

At its Crown Fields scheme outside Chester, he said CEG has secured planning permissions for almost 1,000 new homes, 5,500 sq m of employment and retail space and a new primary school. The homes on the former 120-acre former Ministry of Defence site are being brought forward by Taylor Wimpey, Redrow, Elan and Bovis, with the latter delivering shops and services.

And CEG will offer the second phase of its scheme at High Bartle, located to the north west of Preston, to market next year. Hodgson added that the 300 to 350 homes on the 100-acre site could be broken up into small lot sizes. The 350 home first phase is being delivered by Morris Homes.

Manchester needs to improve the quality of its city centre social infrastructure, such as doctors’ surgeries, schools and parks, said James Heather, Development Director of U+I: “Over the last ten years, the city has changed hugely. We probably need to play catch up on social infrastructure: people need to live in a place not just exist. Hopefully we are able to deliver really good quality homes and offices and we need to back that up with more quality infrastructure.”

He said U+I hopes to secure funding, contractors and planning consent within three years for its Mayfield regeneration project next to Piccadilly station where it also aims to have delivered Manchester city centre’s first park by 2020.

Naisha Polaine, Head of UK Projects at the Department of International Trade’s capital investment team, told the event that Greater Manchester has a head start over many other English regions: “You don’t have the problem that many places have: the challenge that nobody has heard about you so capitalise on that interest.”

There is ‘no shortage of interest’ in Greater Manchester, where the team has helped to facilitate £3bn of international investment over the last three year, Polaine said: “There is a lot of capital and we don’t see that going away.”

She said the institutional and large private investors, which her team works with, typically want large scale investment proposals generating returns of 6-8% including an income.