To boost the high street, cities should invest in offices

Offices in Northampton. Image: Getty.

Access to cheap borrowing has encouraged local authorities to proactively invest in commercial property. These assets can be a valuable tool for cities looking to improve the built environment they offer businesses and residents.

Councils are estimated to have spent £3.8bn on property between 2013 and 2017, funded through the government’s Public Works Loan Board (PWLB) at very low interest rates. Offices accounted for half of this investment, and roughly a third (£1.2bn) has been spent on retail properties. And local authorities were the biggest investor group for UK shopping centres in the first quarter of 2018.

Why are cities investing? There are two major motivations.

First, at a time when cuts are squeezing council revenue budgets, property investments can provide a long-term revenue stream to keep quality public services up and running. Second, ownership of buildings in areas marked for redevelopment allows councils to assemble land more easily and gives them more influence over the changes taking place, allowing them to make sure the space evolves to meet their objectives.

But how exactly can cities turn property ownership into successful place-making? How should they adapt the buildings they invest in to improve the performance of the economies?

Cities need workers

When developing the city’s property offer, the aim should be to get jobs back into the city centre while reducing the dominance of retail space. For councils who have invested in existing retail space and shopping centres, in particular, the temptation may be to try and retain their existing use, with new retail strategies designed to reduce vacancies.

But as the Centre for Cities’ recent Building Blocks report illustrates, the evidence points to this being a dead-end. Instead, cities may need to convert the properties they own so they house a more diverse group of businesses.

Many city centres already have a lot of retail – and this has not offered significant economic benefit. Almost half (43 per cent) of city centre space in the weakest city economies is taken up by shops, while retail only accounts for 18 per cent of space in strong city centre economies. And many of these shops lie empty: in weaker city centres vacancy rates of high-street services (retail, food and leisure) are on average 16 per cent, compared with 9 per cent in stronger city economies. In Newport, nearly a quarter of these premises are empty, as the map below shows.

The big issue in these city centres is the lack of office jobs – which are an important contributor to footfall for retailers. This means that, in order to improve the fortunes of the high street, policy will need to tackle the barriers that deter those businesses from moving to their city centres.

One of these barriers is the quality of office space. In a number of struggling city centres, the quality of office space on offer is poor. But the low returns available for private investors mean that some form of public sector involvement will be required.


Ownership of buildings gives cities the opportunity to reshape the type of commercial space on offer. Some of this will involve improving the existing office stock available, some will involve converting retail to office, and some of will require demolishing part of the space without replacing it, in the short term at least. Without ownership of the land and buildings on it, this task becomes very difficult to do but will be a fundamental part of turning the fortunes of a city centre around.

Cheap borrowing has provided a way not only for local authorities to generate an income stream through property investment. but also opens up the opportunity to have greater control over the development of their city centres. For those choosing to invest, the focus must be on using ownership to make the city centre a more attractive place for all businesses to invest, rather than hoping to revive retail alone.

Rebecca McDonald is an analyst at the Centre for Cities, on whose blog this article first appeared.

 
 
 
 

What other British cities can learn from the Tyne & Wear Metro

A Metro train at Monument. Image: Callum Cape/Wikipedia.

Ask any person on the street what they know about Newcastle, and they’ll list a few things. They’ll mention the accent; they’ll mention the football; they’ll mention brown ale and Sting and Greggs. They might even mention coal or shipbuilding, and then the conversation will inevitably turn political, and you’ll wish you hadn’t stopped to ask someone about Newcastle at all.

They won’t, however, mention the Tyne and Wear Metro, because they haven’t probably heard of it – which is a shame, because the Metro is one of the best things the north-east has to offer.

Two main issues plague suburban trains. One is frequency. Suburban rail networks often run on poor frequency; to take Birmingham for an example, most of its trains operate at 30-minute intervals.

The other is simplicity. Using Birmingham again, the entire system is built around New Street, leading to a very simple network. Actually, that’s not quite true: if you’re coming from Leamington Spa, Warwick, Stourbridge, Solihull or a host of other major minor (minor major?) towns, you don’t actually connect to New Street – no, you don’t even connect to the ENTIRE SYSTEM BUILT AROUND NEW STREET except at Smethwick Galton Bridge, miles away in the western suburbs, where the physical tracks don’t even connect – they pass over each other. Plus, what on earth is the blue line to Walsall doing?

An ageing map of the West Midlands rail network: click any of the images in this article to expand them. Image: Transport for the West Midlands/Centro.

But Newcastle has long been a hub of railway activity. Tragically, the north-east has fewer active railway lines than any other region of the UK. Less tragically, this is because Tyne and Wear has the Metro.


The Metro was formed in 1980 from a somewhat eccentric collection of railways, including freight-only lines, part of the old Tyneside Electrics route, underground tunnelling through the city centre, track-sharing on the National Rail route to Sunderland, and lines closed after the Beeching axe fell in the early 1960s.

From this random group of railway lines, the Metro has managed to produce a very simple network of two lines. Both take a somewhat circuitous route, the Yellow line especially, because it’s literally a circle for much of its route; but they get to most of the major population centres. And frequency is excellent – a basic 5 trains an hour, with 10 tph on the inner core, increasing at peak times (my local station sees 17 tph each way in the morning peak).

Fares are simple, too: there are only three zones, and they’re generally good value, whilst the Metro has been a national leader in pay-as-you-go technology (PAYG), with a tap-in, tap-out system. The Metro also shares many characteristics of European light rail systems – for example, it uses the metric system (although this will doubtless revert to miles and chains post-Brexit, whilst fares will be paid in shillings).

 

The Metro network. Image: Nexus.

Perhaps most importantly, the Metro has been the British pioneer for the Karlsruhe model, in which light rail trains share tracks with mainline services. This began in 2002 with the extension to Sunderland, and, with new bi-mode trains coming in the next ten years, the Metro could expand further around the northeast. The Sheffield Supertram also recently adopted this model with its expansion to Rotherham; other cities, like Manchester, are considering similar moves.

However, these cities aren’t considering what the Metro has done best – amalgamated local lines to allow people to get around a city easily. Most cities’ rail services are focused on those commuters who travel in from outside, instead of allowing travel within a city; there’s no coherent system of corridors allowing residents to travel within the limits of a city.

The Metro doesn’t only offer lessons to big cities. Oxford, for example, currently has dire public transport, focused on busy buses which share the same congested roads as private vehicles; the city currently has only two rail stations near the centre (red dots).

Image: Google.

But it doesn’t need to be this way. For a start, Oxford is a fairly lateral city, featuring lots of north-south movements, along broadly the same route the railway line follows. So, using some existing infrastructure and reinstating other parts, Oxford’s public transport could be drastically improved. With limited engineering work, new stations could be built on the current track (blue dots on the map below; with more extensive work, the Cowley branch could be reinstated, too (orange dots). Electrify this new six-station route and, hey presto, Oxford has a functioning metro system; the short length of the route also means that few trains would be necessary for a fequent service.

Image: Google.

Next up: Leeds. West Yorkshire is a densely populated area with a large number of railway lines. Perfect! I hear you cry. Imperfect! I cry in return. Waaaaaah! Cry the people of Leeds, who, after two cancelled rapid transit schemes, have had enough of imaginative public transport projects.

Here’s a map of West Yorkshire:

Image: Google.

Here’s a map of West Yorkshire’s railway network:

 ​

Image: West Yorkshire Metro.

The problem is that all of the lines go to major towns, places like Dewsbury, Halifax or Castleford, which need a mainline connection due to their size. Options for a metro service are limited.

But that’s not to say they’re non-existent. For example, the Leeds-Bradford Interchange line passes through densely populated areas; and anyway, Bradford Interchange is a terminus, so it’s poorly suited to service as a through station, as it’s currently being used.

Image: Google.

With several extra stops, this line could be converted to a higher frequency light rail operation. It would then enter an underground section just before Holbeck; trains from Halifax could now reach Leeds via the Dewsbury line. The underground section would pass underneath Leeds station, therefore freeing up capacity at the mainline station, potentially simplifying the track layout as well.

 

Image: Google.

Then you have the lines from Dewsbury and Wakefield, which nearly touch here:

Image: Google.

By building a chord, services from Morley northwards could run into Leeds via the Wakefield line, leaving the Dewsbury line north of Morley open for light rail operation, probably with an interchange at the aforementioned station.

Image: Google.

The Leeds-Micklefield section of the Leeds-York line could also be put into metro service, by building a chord west of Woodlesford over the River Aire and connecting at Neville Hill Depot (this would involve running services from York and Selby via Castleford instead):

The path of the proposed chord, in white. Image: Google.

With a section of underground track in Leeds city centre, and an underground line into the north-east of Leeds – an area completely unserved by rail transport at present – the overall map could look like this, with the pink and yellow dots representing different lines:

Et voila! Image: Google.

Leeds would then have a light-rail based public transport system, with potential for expansion using the Karlsruhe model. It wouldn’t even be too expensive, as it mainly uses existing infrastructure. (Okay, the northeastern tunnel would be pricey, but would deliver huge benefits for the area.)

Why aren’t more cities doing this? Local council leaders often talk about introducing “metro-style services” – but they avoid committing to real metro projects because they’re more expensive than piecemeal improvements to the local rail system, and they’re often more complex to deliver (with the lack of space in modern-day city centres, real metro systems need tunnels).

But metro systems can provide huge benefits to cities, with more stops, a joined-up network, and simpler fares. More cities should follow the example of the Tyne and Wear Metro.