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  • Writer's pictureKaren Fletcher

Regional report: Manchester's built environment





Manchester City Council’s mission statement is that it wants to create: “An economy built on people, place and prosperity.”


The city is certainly attracting people. Greater Manchester has a population of around 2,800,000. Of these, 600,000 people live in Manchester city, an increase from 420,000 in 2000. And the council predicts that this will rise to 630,000 in 2025.


Economically, the future looks healthy for Manchester too. Ernst & Young’s regional report states that Manchester’s economy looks set to grow by 2.5% between 2024 and 2026. It is also leading the way in employment growth, with job numbers increasing by 1.8% per year from 2024 to 2026. The national average is 1.3%.  Key growth sectors for employment are in the professional, scientific, technical and financial/insurance sectors.


For the construction sector, the past few years have also seen opportunities on many new-build and refurbishment projects. Deloitte’s regional Crane Survey highlights the remarkable growth seen in Manchester and nearby city Salford just over the past year:


* 61 projects on site in Manchester and Salford

* 2,402 new homes delivered to market and 11,675 under construction

* 381,000 sq ft office space delivered – including 4 Angel Square, which is the largest

* 19% of the 2.2m sq ft of office space to be delivered in 2024 and 2025 is pre-let

* 7 hotel schemes under construction

* 3 student residential schemes started on site: 2,153 rooms

* 15,296 sq ft of educational floorspace completed at the Christabel Pankhurst Institute


Deloitte’s also notes that the pipeline for 2024 and 2025 is ‘strong’ for the office, residential and hotel sectors.


Glenigan also sees a buoyant market in Manchester and neighbouring Salford, with construction activity levels holding up even as they slow elsewhere in the UK. Glenigan points to a ‘proactive planning process in the two cities’ as well as a construction talent pool with ‘resilience and ingenuity’.



Manchester's key development points
Manchester's key development points


Offices

A growing city needs excellent office space. The flight to quality in the office market noted in other SectorScope analysis applies equally in Manchester its surrounds. Tenants want high-quality workspace that also meets a growing range of sustainable and environmental requirements. Manchester seems to be successfully meeting these needs.


Around 1.5 million sq. ft. of floorspace is due to be completed in 2024, with 38% of that figure already pre-let. In addition, 616,680 sq. ft. is in the pipeline for completion in 2025, and a further 75,000 sq. ft. is scheduled to complete at St Michael’s in 2027. Currently, these office developments are largely centred around the heart of Manchester’s city centre in the First Street and Circle Square regeneration areas (see map).


Not all office projects are new-built. As with most cities, Manchester has its fair share of older office properties. Owners and developers face the risk of them becoming stranded assets without refurbishment to meet higher environmental standards. This is certainly driving construction and fit-out work, with refurbishment as a proportion of floor space rising from 21% in 2022 to 53% in 2023.


Examples of office developments in and around Manchester city centre:



Eden Building in Salford, Greater Manchester
Eden in Salford 5.5 Star NABERS rating

Eden: sited in New Bailey St, Salford, this is the first new-build in the UK to achieve a record-breaking 5.5-star NABERS ‘Design Reviewed’ Target Rating and features Europe’s largest living wall.


4 Angel Square: the largest office scheme delivered in the Deloitte Regional Crane Survey area during 2023. It has been designed with strong sustainability credentials, achieving a 5 NABERS ‘Design Reviewed’ Target Rating


First Street Plot 9B: coming forward as a NABERS 5.5-star rating, and the same rating is being achieved at Plot 10a, which secured planning permission in 2023



 

Build-to-Rent

A rapidly-growing population needs housing, and Manchester’s build-to-rent (BtR) sector has undergone tremendous growth just in the last five years. One of Manchester Council’s aims has been to house people close to where they work, so BtR schemes are to be found mainly around the urban hot spots.


Renaker is one of the leading developers of BtR properties and apartments for sale in Manchester, completing West Tower (Deansgate Square) in 2020; North Tower (Deansgate Square) in 2021; and Cortland in Colliers Yard in 2023. These projects amount to 1,185 BtR apartments.




Peeler's Yard preview: CERT Property development

In January 2024, CERT Property began work on a BtR project at Peelers Yard, the site of a former police station. And at the end of 2023, Peel Waters submitted planning for a new BtR project at Manchester Waters. This build will include sustainable features such as heat pumps, solar panels and heat recovery.


These properties provide accommodation with added benefits including on-site gyms, shared workspaces, communal open spaces, EV charging stations and even in-house cinemas. The city council has set out development frameworks around these areas of BtR that focus on creating a sense of community and connection with the wider city – avoiding the pitfalls of high-rise living seen in the 1960s (see the Manchester timeline below).

 

Purpose-built student accommodation

The PBSA sector is one of the main growth areas in Manchester. Greater Manchester has over 120,000 students (including 27,000 from overseas), one of the largest student populations in Europe. This leads to a strong market for rental properties.


The pressure from Manchester’s growing student population (there are ten universities in Greater Manchester) will undoubtedly continue to drive development in this sector. One issue is that with students seeking accommodation, rents are pushed up which impacts all domestic tenants in and around the city. It also means that houses which might otherwise be for sale are leased to students, creating further shortages in the housing market.


Leading developers and investors active around Manchester include IQ, Dominus Group, Whitbread, Property Alliance Group and Mclaren.


Facing a shortage of student accommodation in 2022, and lacking a clear view of where to put new properties, the council commissioned Deloitte to identify potential sites for development (or redevelopment) into PBSA.


In total, 20 potential sites were identified. These include the previously-refused Fusion and Curlew schemes, as well as several other large developments that benefit from planning consent or are earmarked for PBSA in a strategic regeneration framework.




University of Manchester plans for Fallowfield Campus
University of Manchester plans for Fallowfield Campus

In January 2024, Manchester City Council approved proposals for over 5,000 new student beds. This includes the £400 million redevelopment of the University of Manchester Fallowfield campus which has plans for 737 student rooms.




Industrial and commercial development



One of the development areas highlighted by Greater Manchester Council is Airport City. This area around Manchester Airport (the largest outside London and third busiest in the UK) is set for substantial development.


In a joint venture project with Beijing Construction Group, around £1 billion is being invested in a new high-tech campus that will include offices, manufacturing, research and development facilities and up to six hotels. The Hut Group, Amazon and DHL are already on the site.  The airport itself doubled in size in 2021. And in June 2023, lead contractor Mace started work on a new pier which will connect to Terminal 2 at the airport.


Masterplanning for the project has been by 5Plus Architects, whose work includes plans for two six-storey buildings that will offer 184,000 sq ft of Grade A office space, a multi-storey car park and extensive landscaping.

 

Tapping into the UK’s growing science sector

The North West of England is already home to a significant proportion of the UK’s science and tech research, with the largest number of people employed in these sectors outside of the Golden Triangle (London, Cambridge, Oxford). The city’s aim is to build on that existing talent pool, with a bold plan to attract more investment by developing specialist labs, modern office space and campus environments.


In 2014, Manchester City Council approved a regeneration framework for the expansion and growth of Manchester Science Park (MSP). This area covers 243 hectares, running south from St Peter’s Square to Whitworth Park along Oxford Road.


MSP has grown since then, and in 2023, the City Council approved a further phase of construction which includes Bruntwood SciTech’s £60 million redevelopment of an existing building on the site. The updated Greenheys building is targeting a BREEAM Excellent rating, and EPC A and will be net zero in construction and operation. The aim is to create over 130,000 sq ft of world-class lab space which is scheduled to open in 2026.


This is the third stage of Bruntwood SciTech’s plan which will eventually see the development of a 1 million sq ft science and technology hub.

 

Sustainable Manchester -  heat networks

There is growing interest in heat networks around the UK as the government drives forward with its decarbonisation programme. The objectives are not only to reduce the UK’s reliance on gas for heating, but also to reduce fuel poverty for many householders.


Manchester’s history means that heating, particularly in homes, is a key issue for the city and surrounding areas. The Manchester Evening News (18th January 2024) reports that Greater Manchester has one of the highest rates of homes without central heating – with 17,400 households living without a central heating system. This means householders resort to expensive electric heaters or try to survive in cold and damp conditions.


As a result, projects that can help to solve these issues are crucial. Greater Manchester is taking part in the Government’s Department for Business, Energy & Industrial Strategy (BEIS) Heat Network Zoning Pilot, which will inform national policy development for the future use and growth of heat networks to reduce carbon emissions.


All 10 Greater Manchester local authorities have undertaken feasibility studies which highlight the potential long term financial and carbon savings offered by heat networks.

There are currently more than 10 heat network proposals at differing stages of development and feasibility, but they definitely present a unique opportunity.  


The majority of the proposals are linked to planned physical developments and creating sustainable town centres is a core feature of Greater Manchester’s investment strategy.


Greater Manchester heat networks:

Manchester Civic Quarter

Salford MediaCityUK

St Marys Heat Network (Oldham)

OPEN Project

 

HS2 cancellation – a disappointment, not a disaster

Manchester’s recent history is not without its disappointments. The 2023 cancellation of the Manchester leg of the HS2 rail project was gut-wrenching, particularly as Greater Manchester Mayor Andy Burnham lobbied so hard to retain it.


There’s no doubt that the cancellation was certainly a blow to the city’s ambitions, but many observers feel that it won’t knock the region off track.


Property specialist Alliance Investment notes that Manchester has been developing ‘under its own steam’ for the past ten years (as shown by the EY figures). While better connections to Birmingham and London would have been a benefit, Alliance notes that: “HS2 was not meant to be finished until 2033 at the earliest, and this means that the current growth predictions are independent of any supposed future infrastructure projects.”


In an interview with Building Design magazine (8th November, 2023) Simon Bedford, partner at Deloitte Real Estate said he was disappointed by the decision, but that the city will overcome this setback: “Manchester will dust itself down and come up with five or six great things to do over the next five years, because that’s what it does.”


Mayor Andy Burnham is now focused on delivering Northern Powerhouse rail which will create a high speed link between Liverpool and Manchester. Key ambitions include a station at Manchester Airport and an underground station at Manchester Piccadilly in the city centre.

 

Conclusions

Manchester has a long history of development and growth (see our timeline below). It’s an area of the UK which has survived both rapid industrialisation and decline. But during that time, lessons have been learned. For example, the poorly thought-out high rises of the 1960s showed that housing provision must not overlook the creation of communities and amenities and that is being demonstrated in the requirements around BtR and high-rise developments.


There is also more to Manchester than the city centre, and the focus on creating an airport city (the first in the UK) pushes the opportunities for growth out into the wider metropolitan area. The city also has its sights set on tapping into the UK’s growing R&D science sector with a planned science park. This ambition sits well with Manchester’s large student population who will benefit from local employment opportunities after graduation.


For the construction industry, Manchester’s growth and change is also an opportunity to be involved in a broad range of project types. And with a focus on achieving Net Zero as a city, it’s also a chance to engage with developers looking for low-carbon solutions, particularly when it comes to refurbishing those older buildings in the area.

 




A Manchester timeline

1500s: Manchester is a market borough centred around the wool trade and exporting cloth to Europe via London.


1620: Weaving of fustian begins – the first shoots of the cotton industry are seen.


1712: Manchester’s growing wealth supports developments such as the church and surrounding square of St Anne.


1760s onwards: The industrial revolution gets underway with the addition of canals linking Manchester and Liverpool.


1780s: Manchester’s first cotton mill built and by 1830 there are 99 spinning cotton mills in the town.


1801: The town’s population reaches over 70,000 but Manchester is effectively managed like a small village, with no system of government.


1830: One of the earliest modern railways is opened between Liverpool and Manchester.


1838: A charter of incorporation established for Manchester along with an elected town council and a system of local government.


Mid-1800s - The dark side of development: Manchester’s rapid growth as an industrial hub meant that the city’s development of decent housing and other buildings was often neglected. Famously, Friedrich Engels’ ‘Condition of Working Class England’ was written in 1845 and recounts some of the shocking living conditions of Manchester’s working classes.


1850s onwards: Continued growth in which the city’s Royal Exchange becomes the focus of financial trading of yarn and cloth.


1894: Manchester ship canal opens which links the city to the Irish Sea and global markets.


1910: Manchester is the fourth port of the UK and Trafford Park, next to the docks becomes the first industrial estate in Britain. At its height, more than 50,000 people worked there.


Late 20th Century: Manchester’s industrial glory faded, and the city faced redevelopment challenges because of this heritage with abandoned factor sites and many older domestic properties. In the 1960s many slums were cleared, but the alternative living in high rise blocks of the time was not the solution many hope due to poor management and lack of community-building.


1996: The IRA detonated a bomb in Manchester city centre, injuring over 200 people and causing damage to many well-known city centre buildings. New developments were already underway in the city, but this attack gave a new focus to rebuilding.


2000s: The last twenty years have seen a significant renaissance for Manchester’s development. Regeneration areas have been focused on former industrial areas, making for dramatic changes in the skyline and more new projects on the way in the city centre and outlying areas around Manchester Airport, for example.

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