5: Manchester city centre redevelopment
Manchester in the 1980s responded to its post-industrial decline through measures to create new jobs and modernise the skills base of the city. In 1988, the Central Manchester Development Corporation, a public-private partnership (PPP), redeveloped the southern part of Manchester city centre, improving the public realm and increasing office space.58 This, and other measures, coincided with a period of strong economic growth in Manchester during the 1990s and the city centre came to be held back by its limited amount and quality of office space, as well as insufficient retail and hotel space to support tourism. To ensure future investment in the city centre, the council identified that physical renewal in the city centre was crucial.
The IRA bomb in 1996 which destroyed a large area of the city centre, displacing 672 businesses and causing £250 million of physical damage, also formed part of the drive to carry out the physical renewal that had been planned during the 1990s.
Manchester Millennium Ltd (MML), a new PPP between the city council and local businesses was set up. There were four main elements to the development:
- Master planning: The PPP commissioned a consultancy, EDAW, to draw up a master plan, supported by a framework and urban design guidance. As well as creating new office space, a primary aim was to secure investment in leisure and cultural activities, to broaden the attraction of the city centre, through four projects at the Corn Exchange, the Royal Exchange, the Printworks, and the Ramada Block
- Land assembly: The city already owned the freehold on the majority of the site, enabling the city to take a lead on assembly and simplifying negotiations with the five leaseholders.
- Funding: A key task of the MML was to raise public funds for infrastructure. The public investments secured consisted of a £43 million grant from central government, £20 million from the European Regional Development Fund, and £20 million from the Millennium Commission. Some tensions emerged between local and central government following the 1997/8 Local Government Financial Settlement, which made it difficult for Manchester to secure funding to meet the shortfall to begin the project. In response the City Council lobbied government for a ‘fair deal for the city’ to secure the extra funding required. The public investment paid for public realm improvements, transport strategy and infrastructure, deficit funding of projects, the building of the Millennium Centre, and management and promotion costs. By reducing risk and preparing the site for developers, this leveraged £490 million of private funding in physical renewal.
- Take-up: Manchester benefited from existing demand for city centre office and commercial space, as well as the certainty of take-up from previous leaseholders of city centre locations in redeveloped areas.
The redevelopment was mostly complete by 2000, and Manchester city centre now offers the largest office market outside London.59 Interestingly, the number of private sector jobs in Manchester city centre increased by 39 per cent between 1998 and 2008.60 Demand is such that there is now a shortage of office space, with prices higher than regional and national averages.61