Rhys Whalley returned to the UK from Beijing in 2013 to take up the post of Executive Director at the newly formed Manchester-China Forum. We caught up with him to find out why overseas investors continue to target the city.
What’s it like in Manchester now?
Since I moved back, Manchester has reminded me a little bit of Beijing, in that everywhere you look there are tower cranes and building sites. There is a huge amount of activity underway in the city right now; with new developments and investment in infrastructure. And with Manchester’s position at the heart of the Northern Powerhouse initiative, we can expect more to come.
Compared with other parts of the UK, Manchester is extremely dynamic. We have seen a real surge of interest in the city.
Who is investing in Manchester?
Investors are coming from around the world: North America, Europe and Asia. There is particular interest from Chinese investors.
Beijing Construction Engineering Group (BCEG) has invested GBP12m for a 20% share in the GBP800mdevelopment and is also investing in St Michael’s, a mixed-use city-centre scheme . BCEG is also working on the , funded by a joint venture of Scarborough Group International, Hualing Industry and Trade Group, Top Spring - a Chinese based developer listed in Hong Kong - and Metro Holdings of Singapore.
The Peterson Group is to investin order to reinvent the city-centre site as a world-class residential, commercial and leisure district. We will also see more acquisitions such as Chongqing Machinery and Electric Co’s (CQME) purchase of PTG Holroyd for in excess of GBP20m back in 2010, allowing them to grow locally and also open up new markets in China.
Huawei and other large-scale corporates such as. And of course there’s the recent USD400m deal by , the parent company of Premier League side Manchester City.
Manchester’s profile in China will receive another boost on 25 July, when both Manchester football teams take part in the International Champions Cup in China. It will be a game of multiple firsts: the first time the teams play each other outside the UK and the first time Pep will meet Jose as respective managers of their new clubs.
Why this interest now?
Yields are greater than those that can be achieved in prime central London. That’s partly due to recovery following the global downturn of 2008/2009, but alsowhich has given businesses the confidence to take long-term investment decisions.
, particularly in the financial and professional services sectors. Companies can shave 30 to 40% off the cost of running their business compared to London and there is a plentiful supply of high-quality graduates from four universities in and around Manchester.
Freshfields is the latest law firm to take space, following in the footsteps of TLT, Nabarro and Latham & Watkins. And Amazon has signed up for an 800,000 sq ft warehouse at the new Airport City development.
What is the Northern Powerhouse?
The Northern Powerhouse is the UK Government’s plan to create better connectivity between Manchester, Leeds, Hull, Sheffield and Liverpool in order to create a powerful economy for the region. The Government is investing GBP13bn in a variety of transport schemes including HS2 which connects the North and South of England, HS3 which will run from East to West through Manchester and 40 major road schemes. This will increase domestic connectivity, reduce travel times and thus facilitate the growth of the Northern Economy.
Part of the vision is to attract more overseas investors. According to the Government, foreign direct investment in the North has increased by 127% in the last two years since the Northern Powerhouse concept was formed.
In the nine years I spent in Beijing, I saw first-hand at a city level and at a national level, the benefits that investment in infrastructure can bring. The Beijing metro has been expanding rapidly since 2008, making travel round the city so much easier. And 18,000km of high speed rail was built between 2008 and 2016, dramatically reducing the time it took to travel between cities.
What are the Manchester-China Forum’s most important achievements?
Again, transport links are vital. Since the Forum launched, we’ve helped establish three new direct air routes between Manchester and China: Cathay Pacific has been flying into Hong Kong since December 2014; Hainan Airlines started flying to Beijing four times a week from 10 June; and Air China has been granted permission to fly to Shanghai from early next year.
These new routes are essential to drive interdependence and economic relationships between Greater China and the North of the UK. This is something we will continue to push over the coming years.
We were delighted to be able to host President Xi Jinping during his state visit here in October 2015 so that he could see the progress we have made first-hand. The President visited the Football Academy, theand Manchester Airport, to celebrate the new Hainan Airlines route and view the development plans for Airport City.
What are the most notable developments?
There are so many, it’s difficult to pinpoint just a few. Airport City is important; it will provide five million square feet of offices, hotels, manufacturing, logistics and retail space including a GBP130m China Cluster to provide space for Chinese businesses..
Allied London is creating. Circle Square, in the city centre, will be a 2.4 million square feet mixed-use development.
The scale of residential development is vast, particularly across the North of the city, connecting the Etihad Stadium across the Northern Quarter into the City centre. There are a number of very exciting developments and investment opportunities there.
If you could visit just three places in Manchester, what would they be?
The City Football Academy, an amazing facility built to develop young footballing talent; for shopping the city centre boasts a Selfridges, Harvey Nichols and a host of luxury brands. I’d recommend the Northern Quarter for some of the most creative independent fashion stores, bars and cafes. Finally the Museum of Science and Industry will help explain Manchester’s strong industrial heritage and its current research pedigree.
Rhys Whalley is Executive Director of the