Public sector steps in
Published: 2009-07-29 11:08:29
Public sector agencies in the East Midlands are stepping in to fund regeneration projects in the hope that private investment will return before an expected cutback in public spending. (Regeneration and Renewal).
Urban regeneration company Derby Cityscape has been leading attempts to create office space in the city centre. Chief executive John Cadwallader says: "The downturn has dissuaded developers from building a scheme speculatively or taking it forward with a small pre-let."
One developer that is scaling back its plans is Blueprint - a joint venture between Aviva's Igloo Regeneration Fund, Emda and national regeneration quango the Homes & Communities Agency (HCA). It has decided not to go ahead with an office-led mixed-use scheme at Sadler Square, in the Sadler Gate area of the city, for which it has planning permission. Chief executive Nick Ebbs says: "We are half-owned by the public sector and we are putting in more effort to keep regeneration going forward than some other developers, but we have slowed down the pace of our activity because the market has been so challenging and there hasn't been money around."
Ebbs believes that the worst effects of the development freeze have yet to be felt. "At the moment, developers are completing commitments they made two or three years ago," he says. "The impact will bite most noticeably in a year or two, when projects you would expect to come through haven't happened."
Gilhespy says that, because demand for commercial space is slackening, such developments are naturally slipping lower on Emda's agenda. Instead, the agency is targeting struggling businesses. In the short term, this means providing advice through government-funded support service Business Link, as well as grant aid. In the longer term, Emda is concentrating on physical investments, including innovation centres and business incubators, that will help boost the region's competitiveness.
