The mass redevelopment of the North West isn’t a hidden secret – it’s a globally recognised phenomenon, and it’s changing how the UK operates internationally. Both Manchester and Liverpool are assuming the mantle of industry leaders, housing the startups and tech firms that are unable to afford life in the capital.
With the uncertainty of Brexit halting London house prices, investors are turning to the northern cities. The question is, how equipped in the North West to handle the influx of residents and commercial demand? Can it sustain this growth without collapsing under the weight of foreign investment?
What’s important to remember is that this region has never quite been of such economic interest before. It has caused a domino effect on the infrastructure in its cities. In this article, we discuss possible changes set to redefine these locations and how it will affect businesses and residents.
Brexit, on a local level, presents a challenge for authorities to use powers by devolution and make our exit from the EU run seamlessly. Manchester voted 60% to stay and could supposedly lose up to £7 billion each year with a ‘hard Brexit’. Liverpool similarly voted largely in favour of staying in the EU, with increasing support in the region for a second referendum.
The UK Trade Policy Observatory predicted that thousands of jobs in Merseyside would be killed regardless of which form of exit we take from the EU. Greater Manchester equally fears the worst as their universities rely heavily on EU cooperation for research and international students – students who put money into Mancunian high streets and property spaces.
We expect this could threaten the regeneration projects that dot the city skyscape with cranes and scaffolding. A lot of these projects are centred around young urban workers and undergraduates, and preventing international students from studying could derail them. Not only would property be hurt in the process of a ‘hard Brexit’, but it will also damage a variety of industries and organisations including distribution, hotels, restaurants, banking, manufacturing, education and the health service.
While the above certainly spells doom for north-western natives, there is an overwhelming benefit of this unrelenting zeitgeist: foreign investment. The British pound has weakened over the past two years, but it hasn’t scared investors away. Instead it has brought further growth in the property market and led to the necessary rejuvenation of both Manchester and Liverpool.
Greater Manchester was actually recognised last year for its foreign direct investment strategy. It ranked above Düsseldorf, Montreal and Miami. Despite London turmoil, Manchester continues to build relationships on a global scale that secure investment abroad. According to Greater Manchester Mayor, Andy Burnham, this recognition solidified the area as a global city region and “will be even more significant when you consider the impact Brexit will have in the coming years”.
Manchester was joined with Liverpool as one of the top global cities for foreign direct investment, accounting for 68 FDI projects in 2017 and creating 7,000 new jobs. Liverpool’s core sectors include digital manufacturing, health and life sciences. Combine this with Manchester’s strong tech base, and we predict a steady ground for the two cities to facilitate the influx of workers post-Brexit.
With the UK still at risk from another ‘Beast from the East’, it’s important to bear in mind the effects of extreme weather on British business and reflect on how it helped or hindered them in 2018. In March of last year, the UK economy ‘froze’ as temperatures dropped and encouraged people to stay home and shop online. Speaking at the time, the Federation of Small Businesses described UK high streets as “ghost towns”. Anything that takes footfall from the high street will harm businesses without a large online presence.
However, the summer created a window of opportunity for certain industries. According to research firm Nielsen, Britain’s major retailers enjoyed the largest annual revenue rise for four years in June 2018 – 4% higher than the same month the previous year. It also spelt good news for British tourism as the summer temperatures inspired a spate of domestic holidays. According to the Association of British Travel Agents, two thirds of us planned a British break.
This creates an interesting picture for 2019 predictions. It’s as yet unclear whether British clothing companies are planning to extend their summer range products. Similarly, British pubs and bars can’t possibly expect the same footfall they saw during the World Cup. Although, with the weather expected to be warm again and holidaymakers looking likely to take their annual trips within the UK once more, tourism in the North West could prove a boon to hospitality businesses.
In September 2018, research headed by the National Infrastructure Commission revealed that Manchester suffers the worst congestion of anywhere in England outside of London. Apparently drivers were facing gridlock thanks to “snarled-up” roads. Liverpool then followed in second place, demonstrating that the North West struggled under commuter volume.
In response, Andy Burnham announced a series of projects that would completely unify the Greater Manchester area in terms of travel. The plan is set to change how commuters access the city, dramatically reduce levels of road congestion and achieve obligations to clean up the air. Aims that have secured funding include:
- More double Metrolink trams between East Didsbury and Shaw
- Castlefield Corridor expansion – to increase the number of trains that can run through
- Improve cycling and walking routes between Manchester city centre and Chorlton
- Boost capacity on Manchester and Salford Inner Relief Route
- Boost capacity on the Mancunian Way junction with Princess Parkway
Other areas set to receive investment over the next five years are Bury, Salford, Oldham, Rochdale, Wigan and Bolton. This will redefine how we view the North West and its relationship with the rest of the UK. It opens up opportunities for commuters to access cheaper accommodation, widening the space for commercial lots and improving the communities outside of Manchester city centre.
At Rainbow International, we look forward to the opportunities presented by the current climate in the North West. The region remains rich with SMEs and startup businesses all determined to demonstrate growth and value for investors. This has caught the attention of international organisations and lured property developers that are eager to make their own mark on northern skylines.