Trafford commits £71m to Lumina Village
The local authority will provide a development debt facility to Moorfield Group, the London-based investment manager that agreed in January to finance most of the 693-home scheme.
Lumina Village is a £250m mixed-use project set on the 12-acre former Kellogg’s site. Trafford Council and Bruntwood have a joint venture to develop Lumina Village, which will include 200,000 sq ft of offices, a 100-bed hotel, and a primary school.
The JV appointed Glenbrook to deliver the residential portion of the project last year. This part breaks down into two elements, a 440-home build-to-rent section – financially supported by Moorfield – and a 199 affordable home one – funded by £49m from Clarion Housing Group.
It is the build-to-rent portion that has secured the £71m development debt commitment from Trafford Council, according to a report for the local authority’s executive meeting next week. The BTR element of Lumina Village has an estimated gross development value of £120m.
A spokesperson for Trafford Council said: “This investment will support regeneration and deliver housing in the Civic Quarter area – a strategic location for the council – while also providing income which is reinvested in front-line services.”
Lumina Village is far from the only project Trafford Council will be helping finance in the years to come. Looking past the 2023/2024 fiscal year, the council has allocated a future £9.2m for the Bruntwood-led revamp of Stretford Mall and another £2.9m for Chancerygate’s industrial scheme in Trafford Park. Outside of Trafford, the council has allocated £8.5m for the third phase of Salboy’s Castle Irwell in Salford as well as £4.8m for Sunlight House and £22.6m for One Heritage’s 129-apartment One Victoria – both in Manchester.
Factoring in past purchases and spending, Trafford Council’s £500m asset investment fund has only £63.6m available.
The council will be meeting on 21 February to discuss its capital strategy.
Since when did Trafford Council become a bank? if these schemes are commercially viable they should be able to raise funding from other sources than Trafford Council tax payers
By Council Tax Payer
It would be a good area to work in
By Anonymous
It became a bank when central government cut funding to local government and now they playing at being property investors because they need the money the investment is expected to return.
By Mark Smith
Trouble is, if the project goes wrong, tge council will be liable for debts huge enough to “bankrupt” it.
By Bernard Fender
No doubt the Council has taken on quite a sizeable amount of borrowing from the Public Works Loan Board at a very low rate of interest (the report does not disclose that). Investing that borrowing in Trafford is a good thing provided the Council have the right professional advice. However, investing outside of the Borough is a pure revenue generation play not a regeneration play and Elected Members should change their policies to ensure that is not what the PWLB monies are used for.
By Anonymous
Why are they building new office space (granted it’s new) when virtually all the previous office space on Talbot Road has been turned into flats?
By Sibt
I think Sibt they are building new office space here because all of the previous (old) office space on Talbot Rd has been turned into flats.
By Dan
Hi Council Tax Payer. To benefit tax payers this project does not have to be Commercially Profitable but Economically Profitable. The overall economic returns to Trafford Council from such schemes could, theoretically, mean you will in future not have to pay any tax at all.
By Anonymous
It’s deeply odd for Trafford to be keeping on doing this, given the problems trying to be a bank has caused councils elsewhere, up to and including bankruptcy.
It’s not as though almost all of Trafford isn’t an incredibly attractive place for developers or the sites concerned need costly remediation, so given the low risk, It’s not clear why the taxpayer should take any of it on.
Perhaps Trafford could balance the books by raising more in Council Tax if the nimbys on its Planning Committee would stop trying to compete with Stockport to reject the most?
By Anonymous
Investing all this money yet the council tax in Trafford goes up every year typical of a Labour council mentality
By HarryMadeley
Good point Mark
By Moneybags
Harry Madeley – This type of investment by councils of all political colours is taking place across the country and while there have been high profile failures the majority produce a return which helps keep council tax down.
By Anonymous
Trafford council already increasing council tax to cover a 17.9 million black hole. Yet they have money for this and to buy a defunct shopping centre what a joke
By Mike
@Dan
Yes…well..good point but what I was trying to get across was I presumed that the demand for office space wasn’t there hence turning them into flats. A lot of those office blocks were a long time empty.
By Sibt