4.41 A key comfort is that our analysis shows that South Worcestershire shows that the major new employment sites, with the exception of Worcester Bosch are not dependent on large scale public sector intervention. Most are promoted either as part of larger mixed use schemes or as commercial extensions to existing sites.
4.42 So unlike other, more challenging, parts of the Country the scale of new employment land is not at risk. However the lack of available funding may have quantitative implications. There will be less funding to secure cost efficient space in demand from new start up companies. Support the growth of specialist sectors or innovation.
4.43 This is regrettable but unlikely to derail the local economy, people will still have jobs. What it does mean is that the full aspirational potential of South Worcestershire will be much more difficult to encourage.
4.44 One option for the Councils to consider is moving the benchmark for protecting existing employment sites; releasing more brownfield sites for houses and using the new homes bonus together with whatever RGF can be secured to provide new employment sites elsewhere. This could include permitting housing on existing allocated sites and using the bonus to promote alternative sites, or using the bonus to promote existing sites which have no yet been developed. However this assumes the „council tax times six‟ formula remains; which we doubt is viable. Also as discussed elsewhere in this report most of the existing sites are fit for purpose; closing sites and forcing occupiers to move placed a significant burden on them. So it is likely this mechanism (if available) could not be widely used.
4.45 Regardless of what money is available the Councils will only be able to pursue
commercially attractive development proposals. The idea that the public sector can, in relative isolation, proactively plan for new employment sites and rely on public sector funding to provide infrastructure or other gap type funding has now gone. We have no viable mechanism for the public sector to divert the property market to policy preferable locations and help support that intervention with public funding.
Final Report | March 2011 42
5
LAND AND PROPERTY MARKETS
Introduction
5.1 In this chapter we provide a qualitative profile of the demand for employment space, to see what kinds of businesses take up space in different parts of South Worcestershire, what kinds of buildings and sites they are looking for and hence where we may expect demand for new development. This will inform our advice on where land should be identified for B- class development and for what specific uses.
5.2 The chapter is based on Lambert Smith Hampton‟s local knowledge and market expertise. It is also informed by three stakeholder workshops held as part of the study, two with local businesses and one with property agents and developers active in the area.
5.3 Below, the analysis is drafted in two parts. In the next section we provide an overview of demand across South Worcestershire. We then look more closely at individual local authority districts and towns, to identify any gaps in current supply and likely opportunities for future development.
Overview
Offices
5.4 Despite the attempts of pro-active developers, local authority economic development teams and Worcestershire County Council‟s proactive property team to attract inward investment, the main type of business occupiers looking for premises in the area are companies already based within the county who are looking to either expand their business or, more typically, find more modern business premises.
5.5 Many new businesses start within the area simply because the person setting up the business already lives within the region and rather than commute to the larger cities within the West Midlands conurbation or neighbouring centres such as Cheltenham and
Gloucester, they opt instead to set up a business within the South Worcestershire area.
5.6 Initially, many businesses choose to start their operation from home but very quickly they look to take small flexible office accommodation, usually on a fixed monthly rate. As businesses start to win more medium and long term contracts there is often the desire to find more prominent office accommodation within the region with a preference for modern, predominantly open plan office accommodation with amenities close at hand (such as shops, coffee shops and post office), while at the same time having good car parking facilities.
5.7 Once companies have been operating for two or three years (normally paying rent to a landlord) they see the advantage of acquiring their own office premises with any rent that would normally be paid to a landlord instead being used to pay off a commercial mortgage.
5.8 On the whole, companies looking for office space – whether to expand, consolidate or merge - want good quality modern open plan office accommodation, often with raised
Final Report | March 2011 43 access floors, air-conditioning, with close access to amenities, good access to the
motorway network and critically (contrary to current planning policy) ample on-site car parking facilities which allows the business owners and the staff to park unhindered close to their place of work.
5.9 In the workshops held as part of this study, property agents and developers agreed with this general view of the area‟s office market. Participants confirmed that the market was largely local and sub-regional, with most firms „home-grown‟ and little inward investment from footloose firms. They also confirmed the importance of parking, noting that it was often difficult to find suitable premises because none of the properties on offer had enough parking.