The Chamberlain News

MIPIM eulogy of Greater Birmingham shows one side of the economic coin

No one can accuse the authors of the 2016 MIPIM press pack of false modesty.

Every conceivable statistical snippet that could be used to promote the economic prospects of Greater Birmingham is there to inform journalists attending the annual real estate jamboree in Cannes. And quite a list it is.

Birmingham has the highest quality of life of any English city outside of London (Mercer report 2016); 90 million visitors were attracted to Birmingham last year; Solihull was voted as having the highest quality of life in England (Uswitch quality of life index 2015); Birmingham is the most popular destination for Londoners relocating from the capital (ONS 2014).

And there’s more: Birmingham is the most entrepreneurial UK city outside of London with 14,152 new businesses registered in 2015; Birmingham is number one in the UK for real estate investment prospects and the sixth best in Europe (Urban Land Institute/PwC); Greater Birmingham secured 86 foreign direct investment projects during 2014-15, creating over 5,000 new jobs.

That’s not all: Over 90 per cent of the UK market is within a four-hour travel time of the region; High Speed 2 will bring Birmingham within 38 minutes of the capital, it is claimed; Birmingham Airport serves 10 million people a year travelling with 50 airlines to 140 destinations and is growing larger.

In an introduction to the press pack, Andy Street, chair of the Greater Birmingham and Solihull LEP, and Tom Westley, Black Country LEP board member, succeed in making Greater Birmingham seem like the most exciting place in Europe, if not the entire world.

Home to a thriving business community, Greater Birmingham is a leading UK destination for firms ranging from cutting-edge start-ups to international brands.

The Greater Birmingham region is experiencing one of the most exciting periods of regeneration and development in recent times, with numerous further investment opportunities still ahead.

World-class schemes, projects and masterplans are set to cement the region’s reputation as the engine of the UK economy. With a large talented workforce and world-class universities producing widely sought-after graduates, this region is turning ambition into reality.

Greater Birmingham offers more than a business case, and its quality of life is “attracting highly skilled workers and renowned employers from all over the UK and abroad.

From the £750 million redevelopment of Birmingham New Street Station and its surrounding Grand Central complex, to the £150 million Resorts World Birmingham and the £40 million runway extension at Birmingham Airport, the region is more connected than ever before, linking directly to key markets including China and the USA.

The portfolio of opportunities on offer at MIPIM includes development sites around the planned Birmingham Curzon HS2 station in the city centre and UK Central, land surrounding the HS2 interchange station at Birmingham Airport/NEC, as well as the £500 million Birmingham Smithfield scheme to redevelop 14 hectares of land currently occupied by the wholesale markets.

The next stage in Birmingham’s regeneration is underway with the start of the £500 million Paradise Birmingham development, which will contribute to the million sq ft of office space now under construction across the city centre.

In Solihull, a £300 million investment in Junction 6 of the M42 and plans for new Metro connections will further enhance the UK Central Hub. In the Black Country, Wolverhampton is planning to deliver significant investment into its city centre, including £120 million for its Interchange network and a new rail station.

The Birmingham Enterprise Zone, covering much of the city centre, is sitting on an investment fund worth £275 million, created through the ability to borrow against business rates.

About £83 million of EZ funding is being used to support a £500 million Joint Venture between Birmingham City Council and the BT Pension Fund. It will provide 170,000 square metres of new office-led mixed use space at Paradise, including Grade A offices in up to 10 buildings, a 4* hotel with up to 250 bedrooms, road improvements as well as new public squares and new public streets.

You would not expect a press pack for MIPIM to do anything other than put Birmingham in the best possible light, in the knowledge that potential investors will in any case conduct their own research before being tempted to move their money here.

In the interests of balance, it is necessary to point to Birmingham city council’s Business Plan and Budget 2016+ which sets out the other side of the recent economic success story.

Birmingham is the sixth most socially deprived local authority in the country and just under 40 per cent of its localities are in the most deprived ten per cent in the country. There are above average levels of child poverty and 30 per cent of the city’s children live in a deprived household.

The local economy has emerged from recession, but “comparatively high levels of unemployment, worklessness and low levels of skills remain a challenge”. The employment rate in Birmingham (61.1%) is significantly below the UK average (72.1%).

For Gross Added Value (GVA) per head, Birmingham (£21,093) is well below the UK (£24,958) and has the third lowest figure among the core cities. Birmingham GVA is predicted to grow by 27 per cent by 2030, lower than the 34.6 per cent growth expected for the UK.

These gloomy statistics, which are far from new, cannot take away from Birmingham’s economic rejuvenation. The most entrepreneurial city outside of London, new businesses are flooding in, and the rate of growth will rise exponentially when HS2 arrives.

And news just in, too late for the MIPIM press pack, exports of goods from the West Midlands region increased to £28.97 billion last year – up 0.8 per cent on 2014. The West Midlands remains the third largest exporting region in the country, behind the South East and London, with 10.4 per cent of total exports.

This is good news, but it is always advisable to view both sides of the coin. However unpalatable that may be.