In conversation with Gerry Brough
Gerry Brough is the Director of Place at Bolton Council and will be speaking on the Local authority property investment & regeneration – risk versus reward panel at the Public Sector Solutions Expo on 26th June 2019.
What was the decision-making process behind choosing to work with BCEGI?
BCEGI is a global construction company with a reputation of successful delivery, and we knew they could help deliver our £1.2bn town centre masterplan vision.
They have experience of development on a large scale and their track record speaks for itself – BCEGI is an equity and construction partner on Manchester’s £1bn Airport City and the preferred contractor for a £1bn Salford mixed use neighbourhood.
We used £14.6m of our £100m investment to purchase Crompton Place. After a lot of work behind the scenes BCEGI has now partnered with development specialist Midia to form Bolton Regeneration Limited (BRL), a 50/50 Joint Venture company. BRL will work with the Council and invest £250m in redeveloping Crompton Place to create a new mixed use, retail, residential and office development in the centre of Bolton.
It’s a competitive marketplace for attracting experienced and capable investors such as Midia and BCEGI. Their willingness to create an equally strong JV company for the specific purpose of redeveloping Crompton Place was a critical factor in the council’s decision to work with both companies and to support their plans using some of the £100m funding the Council has committed to deliver Bolton’s town centre regeneration plan.
How did you assess the risks of the £100m investment before proceeding?
The decision to borrow £100m was a bold one but our politicians understood it was necessary to act as a catalyst to lever in the private sector capital needed to deliver our ambitious masterplan. It demonstrated to developers and investors that the Council are serious about regenerating our town and are willing to make a significant financial commitment to achieve this objective.
We are not using council tax income or money from existing budgets to provide the necessary funds. Instead, we secured a low interest rate loan, which is being repaid using dividends from Manchester Airport and the Yorkshire Purchasing Company.
The investment is also part of our three steps to success: creating a vision and ambitious masterplan; being investor friendly and using direct intervention, by investing £100million, to attract serious investors.
It was always the Council’s contention that investment in the Town Centre would generate additional Council Tax receipts and increased levels of business rates. The Council also expects to benefit from higher rental values and investment returns from Council owned properties in the Town Centre.
So far, private sector interest in Bolton’s regeneration plan has been huge and, as a result, we expect that the Council’s commitment to invest £100m will attract more than £1.2bn of investment into Bolton Town Centre, instead of the £1bn that was originally forecast.
How has the regeneration programme already begun to create local growth and new job opportunities?
Since we launched the plan in September 2017, we’ve been working closely with developers and investors to make sure local employment, training, apprenticeships and opportunities are at the core of our masterplan delivery programme.
The masterplan is spread over five ‘intervention areas’: Cheadle Square, Church Wharf, Croal Valley, Crompton Place and Trinity Quarter. And work has already started. Developers Midia are transforming an empty department store with a new ‘drop-in hub’ designed to showcase our ambitious plans and keep residents informed of progress. This will bring a currently vacant town centre property come back into use, creating new jobs for local people in a new independent coffee shop within the hub and employing local contractors, such as Seddons, on the property redesign and fit-out.
It is still early stages of the implementation programme. However, the Council has already invested a considerable amount in upgrading the Town Centre’s public realm and this has created a number of jobs in local contracting companies. This work will support the planned new developments and help to ensure that the Town Centre is a pedestrian friendly and safe place for both residents and visitors.
When the new developments are completed, they are expected to provide 1800 new homes, create an additional 7400 new jobs in the Town centre and bring in £412 million of extra economic activity. New attractive green spaces will also be created and connectivity around the Town Centre and with the Town’s transport interchange will be significantly improved.
What is the next major step in the regeneration programme?
Another £27.5m application is also in the pipeline for Croal Valley from developer PlaceFirst who want to create Bolton’s first build to rent urban village. And Midia have revealed plans to build a new 500 space multi-storey car park, a 230ft residential tower block and 30,000sq ft office on the towns’ Trinity Gateway site.
These developments will be quickly followed by a proposal to build more than 350 high quality residential units on the Town’s ex-bus station site at Moor Lane and a proposal to create a four-star hotel and hospitality training facility in the town centre.
In the meantime, Empire Property Concepts have recently acquired a major town-centre development site across the road from the Council’s Trinity Gate site and have already started to demolish existing buildings on the site. Their intention is to develop a major mixed-use development scheme on the site. This is an early sign that the Council’s objective of attracting new private sector investment into the Town centre is already being realised.
Whilst all this activity is on-going we will continue to work with BCEGI, Midia and BRL to redevelop Crompton Place and other sites in the town centre.
Bolton Town Centre will experience significant change for the better over the next few years… and this change is being very-much led by Bolton Council!