The council has set up a fund for land and property purchases that would help finance its significant borough regeneration strategy over the coming years.
The news comes two months after St Helens Council signed a 20-year agreement with developer consortium English Cities Fund to regenerate the Merseyside town, including potentially delivering a £200m mixed-use scheme.
The £10m Land and Property Acquisition fund will come from the council’s capital reserves and sit alongside a revised strategy to help deliver “ambitious” economic development and renewal plans for the borough, St Helens said. The money is to be designated solely for investment purposes, and the council has also signalled its intend to dispose of some of its non-operational property portfolio to generate further cash.
“This is really exciting,” said Cllr Richard McCauley, St Helens’ cabinet member for regeneration and planning. “The strategy and fund put the foundations in place to make sure regeneration can happen quickly and efficiently, so with the support of our strategic partner we can deliver the changes that the people and businesses of St Helens want to see.”
The council is targeting retail, office, industrial and other acquisitions that generate yields ranging from 2% for low-risk prime property, to over 20% for high-risk dated property in secondary locations with increasing vacancy rates, according to the strategy document.
“Much of the office space and secondary shopping centres in the borough would fall into the latter category,” it said.
St Helens aims to use surplus income generated from new acquisitions to pay off borrowing costs and assist in “funding further regeneration activity”.
Most of the council’s existing non-operational portfolio is classed within the yield range of 10-15% or higher and brings with it inherent risks, the document added.
“Effective estate management strategies will seek to dispose of some of the higher risk or poorer performing properties and to acquire properties with a significantly lower risk, to redress the risk balance.”
“The council’s ultimate aim is to have a broad range of properties at the best possible quality.”
The refreshed investment strategy reflects recently published guidance from HM Treasury, which supports the use of funds to deliver economic development and regeneration projects, the council noted.
Said McCauley: “The overriding objective of the Land and Property Acquisition strategy is to ensure that the council has a robust and timely process that facilitates our regeneration plans and accelerates delivery of projects.
“Fragmented ownership is often the biggest challenge when bringing forward regeneration projects and this fund will be used in circumstance where there is a clear and considered rationale to purchase land and property interests.”
St Helens is currently working with English Cities Fund to start drawing up early-stage proposals to regenerate the borough. ECF comprises Muse Developments, fund manager Legal & General and government agency Homes England.
“Our goal now is to support the local economy, develop future employment opportunities and make our town centres places people can be proud of,” McCauley said.
“This is more important than ever given the impact of the last year and the fact national unemployment rates are now at the highest since 2016.”