1: Firms choosing to move back into Bradford city centre
Bradford is one example of where an intervention was needed to provide quality office space. But rather than the city council stepping in, it was Business & Enterprise Finance, a subsidiary of West & North Yorkshire Chamber of Commerce who did this. In 2013 they opened Bradford City Hub, a high-quality office set within a refurbished warehouse in Little Germany.
Their motivation came from the lack of high-quality offices in the city centre. Low office rents (£5-8 per square foot) prevented the private sector from delivering space directly. It was often more profitable to convert properties into residential buy-to-lets, and the use of Permitted Development Rights meant the council could not restrict these changes of use despite a stronger need for offices.
Despite the apparently weak market, the Chamber believed there was sufficient occupier demand to make a success of a speculative office development. A combination of European Regional Development Funds (ERDF), Bradford Council and equity funds made the scheme possible.
The success of the Hub suggests they were right. The 7,000 sq. ft. Grade A space contains 19 offices and 5 meeting rooms, and occupancy rates have been consistently high since opening. The high quality means they are able to collect higher rents (£16-17 per square foot). The original target occupiers were start-ups and young companies but a number of more established firms have now been attracted in, highlighting the wider appeal of city centre space.
Interestingly, several professional services firms have since moved from the city’s business park into the Hub, citing the city centre’s rail links, amenity offer and the Hub’s co-location opportunities as particular attractions. On the flip side, several firms have relocated from the Hub to the business park. These were less knowledge-based and so did not benefit from the spillovers on offer in the city centre.
The Chamber considers Bradford’s next challenge to be the lack of grow-on space for those who have expanded beyond the City Hub’s scale. Currently, firms are forced to migrate to business parks, but many would prefer larger, flexible city centre premises so they can continue to reap the benefits of a central location. As a result, Business & Enterprise Finance is now considering City Hub 2 to meet this demand.