Some cities around the world are beginning to buck the long established trend of suburban living as discussed in the recently published Strategy Briefing, Urban Core Revival: Drivers, In-Depth Look at Cities and Implications for Businesses. Among UK cities, this tendency is most evident in Manchester’s core urban area (City of Manchester) which grew seven times faster compared to the remaining metropolitan area over 2006-2016. The city’s regeneration since the end of the 1990s has helped modernise its landscape, providing a basis for the development of the city’s service-based industries and nurturing an urban vibe that has great appeal to young professionals.
Population growth in the core urban areas of select UK cities: 2006-2016
Source: Euromonitor International
Regeneration – the backbone of Manchester’s growth
After its industrial success during the 18th and 19th centuries in the textiles industry, the decline of manufacturing in the 20th century, as well as the growing trend of suburban living, left the city centre in tatters, with swathes of derelict buildings and escalating crime. Indeed the turning point came in 1996 after the IRA (Irish Republican Army) bombings devastated large parts of the city centre, including the Arndale Shopping Centre and Shambles Square. The city’s rebuilding became a national priority and this entailed the development of Manchester Millennium Limited— a public-private partnership taskforce in charge of redeveloping Manchester into a modern, thriving and livable city. The city’s development revolved around six focal points: Restoration and Enhancement of the Retail Core; Stimulation and Diversification of the City’s Economic Base; Development of an Integrated Transport Strategy; Creation of a Quality City Core Fit for the 21st Century; Creation of a Living Cityand The Creation of a Distinctive Millennium Quarter. Indubitably, the regeneration process planted the seeds for success and cemented its position as a major contender among other large cities in the country such as Birmingham, Leeds, Edinburg and Glasgow in becoming the UK’s next most important investment market after London.
Growing city drives appeal to young professionals
The success of the Commonwealth Games in 2002 further consolidated Manchester’s ambition in becoming a regional urban centre which not only offers career opportunities in well-paid knowledge-based industries but combines this with a high standard of living. For example, Manchester’s financial district, Spinningfields (also dubbed the Canary Wharf of the North) which formed in the early 2000s, plays host to some of the largest companies in the UK including the Royal Bank of Scotland (RBS), Barclays and BNY Mellon. The transformation of the city into a thriving tertiary-based economy, capable of attracting some of the most prestigious names in finance and professional services, roused the attention of highly-skilled graduates from all over the country. The lure of chic and hip city lifestyles among the young drove residential real estate investment into the city. Beetham Tower for instance, completed in 2006, was one of the most notable, being the tallest residential building in Europe at 169 metres with a total of 47 floors.
City of Manchester to continue thriving
With London embroiled in an affordability crisis as pointed out by the real estate researchers Knight Frank, it presents a perfect opportunity for Manchester City Centre to continue consolidating its commercial, residential and retail potential. According to the Global Investment Firm BNY Mellon, in the decade to 2025, 55,000 new jobs will be created in the city centre alone adding over GBP19 billion (USD26 billion) in total gross value added by 2030. With Manchester’s core urban area’s population set to reach 615,000 in 2025 as according to Euromonitor International (557,000 in 2016), the demand for residential real estate will continue to be powered by the continued influx of young professionals and students. One of the newest residential and commercial developments, the GBP153 million (USD207 million) Angel Gardens, will add a further 466 flats and continue maintaining the city centre’s residential appeal.