Investing in the Future: Can we fix our “broken” town centres?
This Revo presentation presents the findings of research into the key issues and challenges facing town centres and the high street, as well as key figures relating to public investment in shopping centres between 2016 – 19.
Following on from previous research conducted in 2018, which showed that many local authorities have purchased retail and other commercial assets to regenerate struggling high streets and create revenue, this report from Revo revisits the state of both public and private investment in the high street.
The results of an online survey, which generated over 200 responses from experts and advisers across the public and private sectors, form the main findings of this report. The two key commercial and policy challenges identified by the respondents were the growth of online shopping and the high level of business rates. In the case of business rates, concern had risen from 49% of respondents in 2018, to 69% in 2019.
After the reduction/reform of business rates, both public and private sector respondents identified the need for increased investment in town centre environments / public realm and masterplans/business plans, as well as the need for increased government funding, as key priorities. The report recognises the investment that government has already made, through the Future High Streets Fund, Towns Fund and High Streets Task Force, but notes that the biggest challenge for any major development and regeneration projects in town centres is still ultimately how to fund it.
Since 2016, however, local authorities have emerged as key investors in the property market alongside traditional institutions. Drawing on different sources of funding, but predominantly the Public Works Loan Board (PWLB), local authorities have invested £5.6bn, of which 49% has been in offices/business parks followed by 27% in retail. Of this total investment, 69% has been within the lead local authority’s boundaries and 26% outside.
Whilst the private sector has disinvested in shopping centres during this period, by a value of £1.85bn, local authorities have been the most acquisitive, increasing investment in shopping centres by £0.77bn. This has resulted in local authorities purchasing 1 in 5 shopping centres since 2016. This, the report notes, is a sign of local authorities ‘taking back control’ as the custodians of place and should be complemented by a clear vision for town centre development, as 66% of respondents identified the need for increased investment in business plans / masterplans for the high street as a key priority.
The report concludes by presenting a summary of points including that the traditional regeneration and investment model is no longer fit for purpose, as we need creativity and stronger place leadership. Local Authorities are a significant investor in place but investment decisions (and borrowing) need to be underpinned by robust strategies and be guided by development frameworks. Sound advice is needed at the outset, as is the rationale for investment, in order to test all options and help mitigate risks.