Manchester reignited with Potato Wharf

Potato Wharf

Property in the UK may not be spiralling into worthlessness, but the market is likely in for a shake-up. While fundamentals remain sound, there are flies in the ointment: troubling economic statistics from the country’s think tanks, a cantankerous European Union, an embattled Prime Minister. But life goes on and the UK is still among the world’s favourite investment destinations. As London braces for what could be an ugly divorce, alternative locations like Manchester stand to reap the benefits of finally being heard.

Catching the leader

“Since Brexit, what we’ve seen is more inward investment into the UK, into the regions. Manchester is swallowing that pretty quickly,” begins head of residential development for Australian developer Lendlease in the UK, Richard Cook. “In terms of the regions, what we are seeing from the government is a shift change regarding the regions. London has been the powerhouse in the UK, always has been. But politically the government is recognising they’ve got to invest in the regions… And that’s positive. There’s a rebalancing of the economy going on.”

Cook is referring to the upside of what could be seen as a decentralisation from London that is re-focusing attention on the UK’s more neglected regions. With office rents and prices in the capital increasingly unfeasible for many multinationals, blue-chip tenants like KPMG and HSBC are relocating — and not just to save on rent. “It’s about people being able to live cheaper, and holding on to your employees longer. The cost of living and two-hour commute in London gets in the way of life,” says Cook.

Which is not necessarily the case in Manchester. Lendlease has been active in Manchester for over a decade, investing heavily for its growth potential, resilience and depth of a global city. The Economist’s annual liveability index ranked Manchester highest among UK cities, it has the country’s best performing rental market, and JLL puts Manchester's price growth at 28.2% over the next five years, with rents rising 20%-25% according to RICS. Households are growing at a clip of over 3,000 per year and population growth is projected for 80,000 annually by 2024 adding to the nearly three million there now. Businesses are moving in, a billion-pound airport expansion is underway, there’s an investor-friendly supply shortfall of 20,000 units per year, and over 100,000 students study at Manchester’s renowned universities (15% from Asia). The future looks bright.

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But Brexit looms, and it could hurt. Admittedly London has more at stake, but depending on negotiations, the UK could lose up to 20% of its nurses and 25% of its university instructors (who come from Europe), and be forced to contend with massive regulatory bills the EU currently covers (food safety, license plates, energy regulations, arts subsidies), all while bleeding banks, which are said to be heading to Dublin, Paris and Frankfurt. With 18 months to go, Cook isn’t worried.

“If I buy a piece of land, I’ll negotiate from a position, and right now they’re positioning themselves. The UK is being hard, Europe’s being hard, and somewhere we’ll find that common ground. Fundamentally there won’t be a massive shift. The major banks are looking at Dublin. Why? It’s right there, they speak English, it’s an hour from Heathrow. They’re creating 30 jobs in Dublin, basically a post box. It was the same after the GFC and the clampdown after it. There was all the noise, everyone was off to Luxembourg and Switzerland, but it didn’t happen. Because the [executives] don’t want to live in Switzerland.”

Potato Wharf

Potato Wharf

Living heritage

It would appear many are willing to live in Manchester if the sold out and fully occupied first and second phases of Lendlease’s Potato Wharf are any indication. Located in the historical Castlefield district surrounded by canals, listed viaducts and industrial structures, Potato Wharf is one of the city’s most popular neighbourhoods. The 191-flat development is called Potato Wharf very simply because the tubers coming from Ireland at the turn of the 20th century were unloaded at Liverpool then shipped by barge to Manchester. Before that it was home to Romans when the UK was Britannia. “So there’s history there,” notes Cook. “It’s a conservation area, so there are plenty of old mill buildings and so on, and so in terms of architecture we’re following the industrial heritage; reflecting the old Castlefield area.”

And it’s affordable, running at approximately £400 (HK$4,100) per square foot, making it attractive to young professionals and fresh graduates: rents are manageable. Manchester has thriving music, culture, art and sports scenes, and robust science, technology, medicine, banking, and TMT industries. “The regions of the UK offer [a] better lifestyle, and people are starting to recognise that,” finishes Cook. “People who live in Manchester, live there to work in Manchester.” The city also has plans for a green belt around the canals similar to Manhattan’s Waterfront Greenway, which would run right past Potato Wharf.

Potato Wharf

Potato Wharf

Designed by Birmingham’s Weedon Architects with interiors by boutique studio Tegerdine Associates, Cook boasts, “We’ve brought a spec to Manchester that’s equal or better to what you’d see in London.” Many flats have balconies, all come with Amtico flooring, brick-effect tiling, Silestone kitchen worktops, green roofs, smart utility meters, underfloor heating, and contemporary bathrooms. The address is under 15 minutes on foot to the CBD, Deansgate, and transit connections to Birmingham (90 minutes) and London Euston Station (two hours). The city itself is trialling direct-to-premises, full-fibre, superfast broadband (1Gb/sec). That’s an HD television show in five seconds.

Flats at Potato Wharf’s final phase range between 469 and 802 square feet, and are priced beginning at approximately £200,000 (HK$2 million). Potato Wharf is scheduled for completion in 2019.

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