Mayfield Office 2 October 2019
The first phase of Mayfield features a public park and 320,000 sq ft of offices

U+I aims for £100m profit on Mayfield 

Dan Whelan

The listed developer said it has a target of returning a profit of between £80m and £100m on its 30-acre regeneration project close to Manchester Piccadilly station, according to a trading update published today, providing a welcome fillip for shareholders.

“The scheme is expected to deliver £80m to £100m of profit and £40m in development management fees to U+I over its lifespan to 2034,” the company said in a statement.

Matthew Weiner, chief executive of U+I, said it had been a “good start” to the financial year following a “challenging period” which saw the firm make a £58.6m pre-tax loss for the year to April. 

Following news of the loss, U+I was given a boost when it secured a £23m grant from the Government’s £900m Getting Building Fund. 

The grant will enable the first phase of Mayfield, comprising a 6.5-acre public park and 320,000 sq ft of commercial space across two office buildings designed by architects Bennetts Associates. The cost of the public park has been a longstanding viability hurdle for developers at Mayfield, necessary to make it an appealing place for occupiers and residents but removing a chunk of space that could be sold or let.

The £1.4bn Mayfield project aims to bring back into a use a previously derelict site opposite Manchester Piccadilly station over the next 10-15 years. 

Once complete, the redeveloped site will provide 1,500 homes, a 650-bedroom hotel, retail and leisure space and more than 2.3m sq ft of offices.

U+I is delivering the scheme as part of the Mayfield Partnership, which also includes government-owned railway land developer LCR, Manchester City Council and Transport for Greater Manchester.

Weiner said: “Following on from such a challenging period, it has been a good start to the year for U+I where we have focused on progressing and realising value from our existing portfolio, reaching key milestones across a number of our major regeneration projects, priming them for delivery. 

“Securing the largest single Government grant at Mayfield is testament to the quality of our schemes and alignment with Government’s Build, Build, Build agenda. This grant also reinforces the relevance of our business model in the UK’s post Covid-19 economic plan which, combined with the momentum we have seen at the start of the financial year give us confidence in the long-term outlook for U+I.” 

The project team for Mayfield includes masterplanner Studio Egret West and Deloitte Real Estate as the planning consultant, alongside consultants Faithful + Gould, Stace, RoC Consulting, WSP and Buro Happold.

U+I’s share price was up 3% on Thursday morning to 64p.

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Are they going to pay back the grant from the government then?

By Brian

Get on with it then. Most hyped development ever but nothing seems to happen.

By Bob

“Are they going to pay back the grant from the government then?”

September 10, 2020 at 11:18 am By Brian

In a way, yes. The purpose of the grant is, literally, to get people building. This will result in the completion of commercial development, thereby increasing tax revenues to the government, sooner than would’ve otherwise happened.

With this and other grants it’s one way how government, national and local, are trying to get things going up and down the country.

By now

Who needs reminding that, despite acres of promissory notes, consultation & visualisations, nothing has materialised at Mayfield, beyond MIF, Warehouse Project, sundry meanwhile use, & currently, estimable Freight Island. I guess the drawback of being a listed company is that U+I must constantly appease shareholders. Mayfield Depot was significant infrastructure, & would still be better used as a railway depot & communications hub, than as a somewhat high-risk addition to the city centre’s Commercial offer. It is a somewhat random place to put a public park. Once Argent pulled out of Manchester, it was unlikely that Mayfield would be built out within the last economic cycle. Sad to say (for U+I & their partners), it is even less likely to go anywhere upwards anytime soon Is it not time to look at Mayfield & University Of Manchester North Campus as a single integrated scheme, with a long & considered lead in? That way, Manchester might get a proper chunk of city fit for the next (& significantly) different decades.

By Phil Griffin

What Manchester wants it usually gets.

By Liver Guy

@By now – why don’t the government buy £23,000,000 worth of stock then since it is very cheap, at least we might get a return on our investment as taxpayers. Why are we subsidising public companies that already have a mechanism for raising capital? Is the free market dead?

By Brian

Bob is right lots of hype with little action.

By Monty