Chaired by Rob Valentine, Director of Birmingham, Bruntwood, the event landed in the same week as the launch of the West Midlands Combined Authority’s (WMCA) £3.2bn investment case to Government to stimulate the economy.
A significant moment in the region’s recovery planning, WMCA’s call to Recharge the West Midlands builds on the ten priorities for recovery previously identified by the West Midlands COVID-19 Economic Impact Group (EIG) earlier in the year.
Central to these plans is the principal role that the property sector can play in leading the West Midlands into a new era of prosperity.
So, as momentum for the region to bounce back gathers pace, what opportunities lie in store for real estate, and how can the government and local authorities best support the industry to help the West Midlands achieve its ambitions for the future?
Wellbeing at work
Speaking about support for employee safety and wellbeing at work, David Egan, Partner at law firm DWF, said that the current, high standard of practices must continue:
“I think the government has done a great job in the regular guidelines that it has issued to businesses telling them what they need to do. We have a strong culture of good health and safety practice in the West Midlands, and it’s really more of the same – be sensible, be practical, and talk to your people.”
Eva O’Connor, an Associate Director at Arup, added:
“There are considerations we are having about how we get staff into work, and the confidence people will have to use public transport. There are many things that can be done that we have been trialling in our East Asia office, such as using Mass Motion Mobility to plan out how the movement is happening around the office and just outside it in pinch points to look at staggering events and travel to and from work.
“This opportunity that we have at the moment in terms of recovery does enable us to look at doing things innovatively.”
Investing in opportunity
As well as nurturing an active and healthy local population, the region’s strategy for recovery also focuses on remaining a competitive location for attracting foreign direct investment (FDI).
The West Midlands has a strong track record of securing FDI projects and employment from around the world, last year remaining the leading region outside of London and the South East for attracting FDI against a backdrop of national decline.
But with the United Nations Conference on Trade and Development (UNCTAD) predicting a decline in global FDI flows by 40% from the pandemic, how can the UK government work with the region’s promotional organisations to kick-start investment pipelines?
David Fisken, Head of Business Attraction at the West Midlands Growth Company, said:
“On a regional and national government level, we need to think strategically about what we prioritise. One thing we’ve done, in line with the UK government and the Department for International Trade, is refocus on existing investors in the region to support, maintain and grow those companies, so they can maximise the benefits of the location that they have – pandemic or not.
“Government also needs to support places like us with localised, place-based strategies, and recognise that it’s not a ‘one-size-fits-all’ for the UK.”
James Dair, Principal – Head of Public Sector Financial Advisory at real estate firm Avison Young, continued:
“Firstly, we need to make sure we have a compelling and investable vision that is capable of translating to international markets. We have a great platform for that at the moment, but we need to make sure this continues.
“Secondly, we need to do our homework and understand how investors will measure and compare our investment opportunities with other regions across the globe.
“Finally, we must be able to translate our vision into a structured and market-facing proposition. Whether it’s from a property partnership model or land transactions, we need to be clear about what we need to achieve out of this, how it is presented to the international marketplace and how it resonates with international investors.”
So, are there any opportunities that the West Midlands could access as a result of the COVID-driven changes to the international investment landscape?
David Fisken said:
“Shoring in various guises is becoming a very popular term – whether it’s reshoring, onshoring, nearshoring or northshoring. There’s a lot of buzz once again about that. COVID isn’t going to kill globalisation, but we’re going to see more self-sufficiency opportunities in regions, and the West Midlands needs to be at the centre of that.”
James Dair added:
“There’s an enviable opportunity for us to be successful. We have cost advantages as a region, and we need to look to use those to our advantage to attract whatever shoring we can.
“We’ve also got a great employment base here, and government support to help retrain people in the region that have been adversely affected by the consequences of COVID-19. But we also need to make sure we have great homes for people to live in to complement that. Fundamentally, it is not just about houses being built, but providing quality places for people to live.”
Investment in new homes is a significant focus of the region’s recovery, but are there any other areas where local real estate would benefit from further funding?
Eva O’Connor highlighted the urgent need to prioritise retail:
“Retail, cultural, higher education facilities and hospitality have suffered the most in many cases. Retail was almost on its knees before the pandemic. We’ve seen examples of shopping centres being turned into co-working facilities and future entertainment facilities, which is something we all want to encourage going forward.
“We want the cities to have a beating heart, and to have and manage the footfall. City living currently does not address the amenities that you need for all demographics. We have an opportunity here to address that when we consider future development and investment in that city space.”
Rob Valentine agreed:
“There’s a very real risk that if we don’t support the retail businesses – particularly Food & Beverage (F&B) retail businesses – then we’re going to see a hollowed out city centre that will set us back 10 years.
“The offer we have now in Birmingham, for example, is so compelling in terms of the social and cultural opportunities that we don’t want to lose that. But it does need to evolve, and to do that, we need to support it.”
Also requiring support is the concept of green growth. The pandemic has put the environment in the spotlight, and the property sector is one of many under pressure to take climate-conscious action. But what policy changes can the government put in place to support this?
Eva O’Connor suggested:
“One key aspect is our whole economy and the way it’s geared up. We don’t really put a value on social or carbon reduction benefits. There needs to be some way of reconciling that to make sustainability a level playing field – for example, not driving procurement on costs alone.
“But it’s not just about carbon. Carbon does have a significant part to play, and it’s pleasing to see the investment that’s happening in the electrification and decarbonisation of our grid. But, we need to invest in areas that adopt circular economy principles, such as the large focus on brownfield sites in the West Midlands’ £3.2bn plan for government."
David Egan agreed:
“There are several fantastic brownfield regeneration projects already underway that are huge, and will provide enormous benefits for businesses and residents. That is a real positive, and the projects that are already in train will be accelerated through this recovery phase. It is a very positive picture from a regeneration point of view, in effect recycling old industrial sites that are there already.”
But brownfield land isn’t the only opportunity unique to the West Midlands. HS2, Coventry’s tenure as UK City of Culture 2021, the 2022 Birmingham Commonwealth Games and the region’s status as the UK’s first multi-city 5G testbed all have huge potential for the West Midlands to not just recover, but elevate its economy to new heights.
Speaking about how the property industry can work with local decision-makers to ensure these projects make the biggest possible impact, David Fisken said:
“Close awareness and collaboration for the industry is going to be key in this, understanding the significance and potential of these assets.
“The Commonwealth Games, for example, is going to give us greater access to strategic foreign markets across the Commonwealth. Some of those key target markets – which we are active in already, such as Australia and Canada – are showing good resilience to COVID and coming out of it quicker, which hastens the opportunity.
“WMGC will have a dedicated Tourism, Trade and Investment (TTI) Programme, which will help us maximise the benefits from the Games, and provide a platform to bring everyone together, provide a unified narrative, and a strong, consistent proposition for the region to attract the industries that we want here.”
James Dair added:
“Now more so than ever before, we must ensure that the private sector and the public sector work in harmony to deliver the opportunities, and take collective responsibility for decisions that need to be made for implementation at the right time.
“There’s often a reluctance and a lack of understanding from the private sector around the public sector’s regimes. The reality is that there is always going to be a robust process around decision-making. Being aware of that and planning in advance will stand us in good stead to deliver the major initiatives we’ve got here.”
Playing to our strengths
But it’s not just the West Midlands that’s running the race to recovery, with other regions also competing for the ear of government. So, has the West Midlands got enough to stand out from the crowd?
Rob Valentine concluded:
“That’s not going to be too difficult for us because of the unique events and milestones we will have here. The current piece around liveability is so important, and we are reading a lot about how competitors have challenges we don’t have here.
“We need to play to our strengths, and if we do that we will thrive because it is clear that there is plenty of opportunity.”
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