CITY PROFILE: MANCHESTER

Manchester has played a crucial role in the UK’s economic growth since the industrial revolution. Now its thriving business landscape, impressive economic forecasts, superb transport system and low operating costs make it an extremely attractive location for residential property investment. It is the engine room of the Northern Powerhouse.

Manchester Metrolink Map

KEY FACTS

Transport: Transport for Greater Manchester (TfGM) has spent over £1.5 billion to expand and develop the city’s tram network (see map above) to deliver lines to Media City, South Manchester, East Manchester, Oldham and Rochdale, as well as a new depot facility at Trafford Bar. Rail links from Manchester Victoria and Manchester Piccadilly to the city’s suburbs and outlying towns are superb. For example, it takes only six minutes to get from Manchester Piccadilly to Stockport. Manchester Piccadilly will also benefit from a multi-million pound investment programme to accommodate HS2.

Economy: Manchester boasts the fastest growing economy outside of the capital and gross value added (GVA) growth projections of 45% between 2016 and 2036.

Employment: Between 2015 and 2020, the number of jobs opening up in Manchester is set to exceed opportunities in cities such as Tokyo, Berlin and Paris, with education and property both seeing rapid industry-growth.

Business: Business is booming in Manchester. New figures show that, as of 2018, there are 23,845 businesses in the city - a rise of 58% from 15,060 in 2014.

Manchester Airport: The flourishing airport is the gateway to Asia. It is the only northern airport with direct flights to Bejing and Hong Kong, while the £130m 'China Cluster' at the Airport’s Group's £800m business park provides a commercial base for Chinese businesses arriving in the UK and offers a wide range of high quality office premises. £1bn is also being invested in Terminal One to underline the airport’s world-class reputation.

Media City/Castlefields/Piccadilly Basin: The multi-million pound investment in these three key areas of Manchester city centre has created a thriving cultural, social and economic community. The development of MediacityUK, a 200-acre mixed-use property at Salford Quays, one of the first and largest urban regeneration projects in the United Kingdom following the closure of the dockyards in 1982, marked a large-scale decentralisation of media production from London. Principal tenants of this international hub for technology, innovation and creativity, include the BBC, ITV Granada and University of Salford.

Trafford Centre: Arguably the finest shopping centre in the north of England, Intu’s investment has paid dividends. Provides a first-class retail and leisure experience.

ECONOMY

Whilst London has always been the business capital of the UK, Manchester is leading the charge in de-centralising the UK market, boasting the fastest growing economy outside of the capital and gross value added (GVA) growth projections of 45% between 2016 and 2036. Furthermore, with operating costs up to 40% lower than London, Manchester provides the perfect environment for profitable growth.

The abundance of FTSE 100 companies with activity in Manchester provide strong evidence that business activity will continue to grow in the city. Location is not a constraint on growth. Now is the time for companies to branch out of London, and with business start-ups exceeding failures, this jewel in the crown of the Northern Powerhouse proves the perfect environment.

Between 2015 and 2020, the number of jobs opening up in Manchester is set to exceed opportunities in cities such as Tokyo, Berlin and Paris, with education and property both seeing rapid industry-growth. Increased opportunities for career development provide an incentive for relocation. Manchester has a forecasted population increase of 15.1% from 2016-2036. The influx of professionals looking for exciting career opportunities has instigated the emerging start-up boom in the city. *

According to the Office of National Statistics (ONS), business is booming in Manchester - with the number of companies soaring in the past four years. New figures show that, as of 2018, there are 23,845 businesses in the city - a rise of 58% from 15,060 in 2014. Business numbers in the city have risen year on year, climbing by more than a thousand in the past 12 months alone, from 22,490 in 2017.

Retail is the most popular sector. The 5,495 companies working in the industry account for more than a fifth (23%) of businesses in the city. That is followed by 4,215 businesses in the professional, scientific and technical industry, ahead of 1,805 companies in the property sector. Within Greater Manchester overall, businesses have also soared over the past four years, rising from 79,025 in 2014 (when modern records began) to 105,250 in 2018.

PROPERTY

House prices in Manchester rose by 34% between 2014 and 2018, outstripping the national average by 4%, according to global property consultancy Cushman and Wakefield. Looking ahead, Manchester leads property market growth in the latest Hometrack index, covering 20 cities across the country, with prices up 7.4% in the 12 months to the end of June this year.

The increase in employment prospects in Manchester will only serve to heighten demand for housing, leading to inflation of property prices and a more active property market, both in sales and rentals. This landscape requires property professionals to manage the market, which, as a consequence of the rapid increase in activity, offers an exciting opportunity for those professionals looking to gain wider exposure in a developing market.

As the Northern Powerhouse’s population continues to swell, the current supply of property, including flats, houses, offices and warehouses will soon be insufficient. Innovative housing solutions will be necessary.

According to Deloitte Real Estate, there are 11,135 residential units currently under construction, which is 4,172 more than in 2017. There are 20 new construction developments which began in 2018.These include Chapel Wharf (Dandara), Manchester New Square (Urban and Civic) and Weavers Quay (Manchester Life). Despite this increase, and two bumper years of construction, there is a still an undersupply of residential property. The pipeline of delivery is forecast to provide a further 6,000 residential units during 2019 and 2020.

The commercial property market in the city, a key barometer of the economy, is equally healthy. Prime office rents are at an all-time high at £33.50 per sq ft and are expected to reach £40 per sq ft by the end of the decade. There is 3.5 million sq ft of office space in the pipeline.

CONCLUSION

Looking ahead, the rising entrepreneurial culture in Manchester reflects a greater innovative movement in the city, making it one of the most attractive cities for relocation and professional development in the UK. With flourishing markets across all industries, Manchester has a booming economy and room for growth; even those industries with a less prominent presence in the city are seeing a rapid incline, with the increasing movement of professionals into the area simultaneously requiring and facilitating growth.

Rapid regeneration has seen population and jobs growth far exceed that of London since the turn of the century. The Centre for Cities think tank recently that said urban renaissance in Manchester, Leeds, Birmingham and Liverpool had been so marked that problems of urban decay had been replaced by a need to find room for further expansion.

When measured by a combination of jobs and population increase, Manchester had seen the fastest city centre growth in England and Wales in the period 2002-2015, followed closely by Leeds, Birmingham and Liverpool. London was in 20th position.

Andrew Carter, chief executive of Centre for Cities, said: “30 years ago the centres of places like Manchester and Birmingham were run-down and struggling, but since then they have undergone a dramatic transformation and have become increasingly attractive locations for people to live and work in.”

Sources: The Centre for Cities (attributed). The Office of National Statistics (attributed). *Manchester City Council. Cushman and Wakefield (attributed). Deloitte Real Estate (attributed). Hometrack (attributed)