Richard Ponton, investment director at Newcastle based property consultancy Walton Robinson, offers his comments on why the city is a prime target for investors both in the UK and abroad.
Newcastle has the largest year-on-year growth in UK GDP per capita at 4.4%.
The city saw an increase of 6.3% in average earnings.
The North East is home to 91,000 millionaires.
Recent research released by Barclays, the UK Prosperity Map 2017, demonstrated that Newcastle is experiencing strong growth and successfully closing the gap on larger UK cities. This is encouraging news for the property investment market in the city and places Newcastle as a location with plenty of opportunities for investors and developers all over the world.
The UK Prosperity Map report for 2017 takes several factors into account including household income, the proportion of pupils with A*-C GCSE grades, house prices and the business birth-to-death ratio. The report states that London continues to dominate as the UK’s most prosperous city but Newcastle is narrowing the gap, with the largest year-on-year growth in GDP per capita at 4.4%. This is above the overall UK figure of 1.8% for the same period. Newcastle also had an increase of 6.3% in average earnings which was the biggest increase of any UK city.
Newcastle is certainly enjoying a great deal of inward investment as far as the property sector is concerned, so it is to be expected that the city’s commercial output is increasing, and unemployment is falling so rapidly.
According to Barclays, there are 91,000 millionaires in the North East region and despite the rest of the region not faring as positively in the prosperity report we can hope that, similarly to other UK regions, the increasing prosperity of Newcastle can have a ‘ripple effect’ and help improve prosperity across the North-East.
In Newcastle, there are several new developments in the pipeline demonstrating the appetite for property investment in the city and demand for both student and private rented sector (PRS) schemes.
UNITE is currently expecting delivery of 575 beds in Newgate Court for September 2018, which will add to their two current schemes. This greatly underlines their commitment and confidence in Newcastle.
Following their first scheme on Westgate Road, VITA have recently completed a second development in Newcastle at Strawberry Place.
These two significant developments are on top of continued institutional investment in purpose built student accommodation in the City, with a combination of asset purchases and forward funding deals continuing to take place giving developers the confidence to keep building.
Newcastle is also now seeing the Moorfield Group, a private real estate fund, backing ‘The Forge’, a Build-to-Rent scheme on Forth Banks. This adds to the £65m investment of Legal and General on the Science Central site, and the High Street Group’s commitment to building Hadrian’s Tower - Newcastle’s new tallest building - a stunning structure housing more 165 high-end apartments, opposite on the corner of Rutherford Street and St James’ Boulevard.
Gateshead is to play its part also, by pushing ahead with plans to develop a World Class purpose built Conference / Exhibition Centre on the south shore of the Tyne, which will finally enable Newcastle to play host to a global audience.
This hub of activity, centred largely around Higher Education, Research, Science, and Technology, is all taking place on the shores of the Tyne, amidst world famous landmarks, and the shrine that is St James’ Park, the home to the region’s only current Premier League football club.
Walton Robinson work with a range of investment opportunities and investors ranging from private individuals to large funds and developers. As members of the Newcastle Gateshead Initiative (NGI) WR will also be joining the NGI delegation to the MIPIM property conference in France in 2018 to help promote the city and the wider region as an exciting prospect for investment and growth.
Contact Richard and the investment team at Walton Robinson on 0191 243 1000 or email@example.com.