Council property rationalisation "can boost private development"
Tue 9th July 2013, 10:06 am
Local authorities should help boost private sector development by moving services to new schemes which have stalled due to a lack of funding, according to a law firm.
Ian Barker, partner and head of real estate at Manchester-based Berg, says that moving council-run facilities such as libraries or theatres, rather than closing them, could provide crucial support to new developments as banks would be more likely to lend money to mixed-use schemes with a public sector element.
He said: "Developers, their advisers, even the public, should be doing everything they can to persuade their local authority to commit to putting something public sector-based in developments which have stalled, because anything with a government covenant is fundable - and once the government has committed, then funding for neighbouring commercial development is a great deal easier to get."
He said that such moves could also free up money for the council and lead to improved facilities.
He added: "Ironically, if a local authority does close a popular and well-performing facility which has a lot of loyalty from the local population, and moves it to a new development, then that loyalty is going to follow.
"If there's footfall, then that becomes attractive to potential funders of neighbouring commercial development."
He said there were numerous examples across the UK where such a model had worked.