What will the City Deal mean to Newcastle?
Paul Earnshaw, partner in Real Estate at DWF, shares his thoughts on what the City Deal might mean for Newcastle.
Since its announcement in early July, Newcastle’s ‘City Deal’ has been met with wide-spread optimism from virtually all interested parties in the city and wider region.
The deal will allow Newcastle City Council to retain the business rates raised in three designated ‘Accelerated Development Zones’, and to invest in the areas using money borrowed on the back of expected growth in revenues as these areas are developed. This is a type of public sector funding known as tax increment finance.
The locally-led investment should help to direct public sector infrastructure spending more efficiently, overcoming some of the hurdles currently delaying development and leading to earlier private sector involvement.
There has been much talk of the £92 million investment that the City Deal could deliver, alongside speculation of 13,000 new jobs and £800 million worth of private sector involvement. However, in practice, what can we expect to see from the initiative?
The three development zones in Newcastle are: Central Station and the Stephenson Quarter; Science Central; and East Pilgrim Street. All could benefit significantly from a fresh inject of funds.
The Stephenson Quarter, a predominately office-focused development, has been dogged by delays for years. However, further backing from the Council should be enough to get the development under way, and by the time it is built it may be the only Grade A space coming onto the market. What’s more, improvements to Central Station will not only improve the prospects for the Stephenson Quarter, but also Newcastle as a whole. The station presents a chance for the city to give a great first impression, but currently looks a little worn.
Science Central is the largest development opportunity in the City, with a significant area of centrally-located land currently standing empty. Early work on hotel and university accommodation is complete, but the City Deal should accelerate the pace to bring commercial, retail, leisure and new homes back to the city centre.
East Pilgrim Street, meanwhile, has been crying out for development for years, with many historic properties standing empty right on the doorstep of Northumberland Street. The Council has ambitious plans for the area, including new public spaces, cafes, restaurants, and offices. The City Deal could be the perfect tool to kick-start such a large-scale project.
The City Deal is no panacea in itself, however, and much will depend on the level of private sector take up once the initial infrastructure is in place. However, the Deal is in place for the long-term, and is intended to last 25 years. Anyone looking back at the city 25 years ago would see a very different place – no Millennium Bridge, no Citygate, and no Angel of the North. A huge amount has changed in the city since then, and the City Deal provides the confidence for the city to look forward to an equally exciting next quarter century of growth and development.
This was posted in Bdaily's Members' News section by DWF Business Law Firm .
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