NW 2015: Public sector resource remains key
International investment, particularly from the Middle East, has been the trademark of 2014 with some amazing investments in residential, student accommodation, science and innovation, writes Michele Steel.
Manchester seems to have struck up a formidable relationship with Abu Dhabi and the spin off benefits of this international focus on the wider region will start to play in during 2015.
More investment from the Far East is likely in 2015. Manchester is now connected to Hong Kong with the UK's only direct flights outside of London. Further routes to China will be seen in the New Year and the potential for Far East firms to set up advanced manufacturing plants or European head offices in our region, which is well connected and cost effective relative to the capital, could be significant.
Trade and tourism across the North West will see a major boost from these direct routes, plugging us in to the world's fastest growing economy. The UK Government meanwhile is currently opening a new British Consulate in the City of Wuhan in central China. Wuhan and Manchester are sister cities, with a relationship dating back to 1980s and Manchester City Council is proactively working to seek to ensure that opportunities arising from the new consulate are realised within the city.
But the property market faces some high risks in 2015 too, as well as great opportunity. Construction costs are already rising and skills shortages are increasingly being reported. There is a risk that the investment potential of the region could be hamstrung by inflationary pressures and increasing materials and labour costs. We have already seen the total exhaustion of brick supplies earlier this year. We expect these pressures to continue to play out as developments start coming online after a long period of inactivity.
More spending cuts, confirmed by the Chancellor in his Autumn Statement, will compound the issue. Whilst the region benefitted massively from the Chancellor's announcements on funding for the Sir Henry Royce Institute for Materials Research and Innovation, and the Factory theatre, without sufficient public sector resource to focus on delivery of those projects, such projects will be at risk of delay.
The materials science sector will however see a major boost early in 2015 with the National Graphene Institute opening early in the New Year. This is a real game changer for the region, putting us on a world map of innovation in science. If the UK can develop more Graphene patents as a result, the potential is tremendous. Seeing Graphene in action might just inspire the next ground-breaking discovery.
The North West has enough world-leading higher education institutions for this to be a very real possibility. Perhaps even the Star Trek Teleporter might become a reality, rendering HS2 obsolete before it reaches its final committee consideration at the end of 2015. The route past Birmingham will still require consideration beyond that date, and I very much hope that 2015 will see the Government put some faster consideration to this and agree to the delivery of the phase two route alongside phase one.
Undoubtedly we'll see more devolution; Liverpool feels like it will be first in line to follow in Manchester's footsteps. I'm not going to even try to predict who will be Manchester's mayor. I can predict however that everyone will be exhausted by talking about it by the end of 2015, never mind by the time the vote is cast in 2017.
Finally, City will win the Champions League. With the new world-class Academy now operating at the Etihad campus, how could they fail?
Michele Steel is North West head of real estate and planning director at Deloitte
