In his regular contribution to Talking Business Stephen Salloway, Managing Director of leading commercial real estate advisors Salloway Property Consultants highlights the importance to Derby of strong local decision making in the face of national uncertainty.
It was interesting to read how the Prime Minister came to her decision to call a General Election. We are told it was while walking in the hills of Snowdonia - no doubt harassed by the Welsh elements (I promise this isn't political!) - that Mrs May came to a calculated realisation that she had to change her mind and call an election. In her opinion, a potentially stronger hand would improve her position to negotiate a better Brexit deal for Britain.
A very bold decision and only time will tell if it achieves her goals but it reminded me of the challenges we can face when it comes to making 'real estate' decisions. Participants in the real estate market are generally entrepreneurial and risk comes with the territory. But is it just a case of stick or twist? If only it were so simple.
Investors and developers change the landscape, physically. They are fundamental to the progress of any economy. They are driven by returns and profit margins and recognize the concept of risk and reward but they are careful and are only likely to 'take a punt' on well-researched prospects in the right location. And that location is more likely to be one that has a strong and stable economy with growth potential, relevant opportunities and a pro-active, 'can do' administration.
In our experience, the general perception of Derby is that it is a good place to do business. In the face of turbulence stirred up by Brexit, and now the General Election, the start to 2017 has been as strong as the end of 2016. There can be little doubt that our major OEM's in the trains, planes and automobile sectors are relatively stable and offer good levels of employment. This results in a strong supply chain and healthy consultancy support, which leads to decent levels of demand from indigenous and foot-loose business.
But these macro-economic factors aren't always enough to swing those important investment decisions – the City has to do its bit. 'Team Derby' - the City Council, Chamber of Commerce, Marketing Derby, City Ambassadors, et al – has an important role to play and can often make the decisive contribution. It has to demonstrate ambition and offer tangible assistance through the often tortuous processes.
I recall recently David Williams' 'Dare to Dream' speech and Dean Jackson talking about 'Disney Derby'. Inspirational and tangible contributions from the city's business leaders are vital and must be encouraged but it is Derby's administration that is being called upon to make the tough calls that will demonstrate the City can deliver on its aspirations.
The recent Big Interview with DCC's Head of Regeneration, Greg Jennings, was an interesting read and clearly demonstrated the important tasks which lay ahead. The Mission Impossible analogy may have been a little tongue-in-cheek but it highlighted how tough decisions need to be made about where to focus the regeneration effort and resource.
Where, what, how big, how tall, how much? Assembly Rooms, Swimming Pools, Ice Rinks, Apartment Blocks? These are big decisions that will demonstrate the extent of the city's ambition and will determine the nature and extent of private sector investment and development in the years to come.
Tough decisions are never easy; it is impossible to please everyone. One example of the tough calls which have faced the City Council is the Derby Nottingham Metro Strategy. Partisanship might have suggested that the proposition of Derby and Nottingham acting bilaterally would be hard to accept, but together the cities are a formidable offering. The recent commitment by the Government to allocate over £60M to the new Local Growth Fund is vindication of this collaborative approach.
Derby is showing resilience during a period of unprecedented political turmoil and economic uncertainty and its continued progress and ability to meet its regeneration aspirations will depend to a large extent upon its decisiveness. We must continue to strive to make Derby the right location and making the tough calls is part of that process. Of course, in the final analysis, decisions at any level are judged by their success, as no doubt Mrs May will discover on June 8.
As a footnote, I recently visited Krakow - a beautiful Polish city where the Old Town is full of spectacular buildings and a huge square. What really struck me were the linear parks following the old wall. Long swathes of tree-lined grassed areas with footpaths and cycleways playing a significant role in connecting the main public and commercial areas. It made me think that Derby could benefit from some 'structural' soft landscaping - linking key parts of the city and providing much needed amenity space for the burgeoning apartment schemes. Much as it is new development and the built environment that drives the property sector and delivers jobs and economic returns, might a better future for the city centre see more open space and green areas? Would this be Mission Impossible or too Disney perhaps? Or would it be a decision too tough to make even while walking in the Welsh hills?