Agenda item

(i)           Report of the Corporate Director of Regeneration, Economy and Growth.

(ii)         Presentation by the Corporate Director of Regeneration, Economy and Growth.

The Chair asked the Corporate Director of Regeneration, Economy and Growth, to present the update in respect of Strategic Employment Sites in County Durham (for copy see file of minutes).

The Corporate Director of Regeneration, Economy and Growth noted the previous presentation referred to the strategies and activities relating to job creation and the next presentation would give details of some of the key employment sites, though not listing all of the employment sites across the County. 

She explained that there were other areas that were also important, such as the 12 main town centres across the County including sectors such as hospitality, leisure and tourism.  She reiterated the need to create higher level jobs and, focussing on logistics and advanced manufacturing both areas of competitive advantage for County Durham, the strategic location of the County being on the A1(M), A19 and the East Coast Mainline. 

She noted that it was important, whilst acknowledging there were a number of employment sites across the County that the CDP included beyond those set out in the report and presentation, that the strategic sites set out clearly in one space significant numbers of jobs.  She noted key corridors included the A1(M), Durham City and the A19, and the opportunities were linked to those key transport links.

The Corporate Director of Regeneration, Economy and Growth noted that Forrest Park was located on the A1(M) corridor, with a 55 hectare site with the potential to create over 3,000 jobs.  She added a number of the businesses already located on the site were large employers and it was important to be able to attract such companies that could employ a significant workforce in jobs on higher than average wages.  She added that additional locational benefits above the transport links included being adjacent to Aycliffe Business Park, being close to Tees Port, and having the potential for a rail freight interchange in the long term.  She noted it was a good example of sector relationships and good transport links that were key in unlocking strategic employment sites, adding there were challenges for such sites within the North East, with Local Authorities having to support such sites with elements such as enabling infrastructure.

The Committee were reminded of the NETPark development, a specialist employment site at Sedgefield that was moving on to its next phase of development.  The Corporate Director of Regeneration, Economy and Growth explained that the site was developed in conjunction with Durham University and was a good example of leveraging the research capability and working with a number of private sector employers.  She noted there were currently 40 occupiers at NETPark, and it was expected that would grow as the site expanded into its further phases of development.  It was added that the site was at over 90 percent occupancy which had grown during the pandemic due to the high value growth businesses on the site and the work of the Council in providing infrastructure and transport investment and helping to develop the site such to allow the space for businesses to grow.  Members noted the good transport links to the A1(M) and A19 and the clear specialist nature of the site, such as the Satellite Applications Catapult and other high-tech businesses that contributed both to the county, region and nationally.  The Corporate Director of Regeneration, Economy and Growth noted that there were over 600 employees across the site, with growth in the next phase to support an additional 1,250 jobs.

In reference to Integra 61 at Bowburn, Members were asked to note the development was a private sector development which had been supported by the Local Authority in terms of enabling works in terms of infrastructure and support in terms of a skills provider to ensure local people were able to access the jobs being created.  It was noted there was significant opportunity to grow the site and the location on the A1(M) and provision of specialist logistic services was important, as well as potential for links with manufacturing.

The Corporate Director of Regeneration, Economy and Growth noted the Aykley Heads strategic site represented a significant opportunity within Durham City, with the potential for up to 4,000 jobs across a 56 hectare site.  She noted that one important element, as was the case at NETPark, was the quality of the development including the green spaces and environment for the workforce.  She explained that it was critical in terms of the types of tenants the Council wished to attract and the types of jobs that would be available as a result.  Members noted existing business and activity on the site included: Atom Bank; Watersons; Honcho; Tait Walker; the North East Chamber of Commerce (NECC); Business Durham; Durham Constabulary; and the Durham City Incubator.  She reminded Members the planning application had been supported around one year ago and stressed that the opportunity was not just for Durham City, but also for the wider County.  It was noted there were similar themes in terms of links with Durham University and the Corporate Director of Regeneration, Economy and Growth added there was positive dialogue with the University in terms of their role in supporting the development, enabling research and creating jobs and roles for future graduates.

The Committee was asked to note the site of Jade Business Park at Murton, and the Operations Director explained the Council had redeveloped the former Hawthorn Colliery and Coke Works site and the site was designated as an ‘Enterprise Zone’ which provided benefits in terms of further development of the site and to the tenants of the site.  She added it was one of the first more speculative developments undertaken in the North East in recent times and explained the Council had worked with a private sector developer to build the site, with the first phase of seven units having been completed in the summer of 2020 with all but one of the units having been let to tenants.  Members noted a good range of businesses with interesting, high value-adding jobs including: a supplier to the automotive sector; a modular housing solutions company; a low-cost solar film manufacturer; and a company manufacturing bespoke architectural glass.  The Operations Director noted within the first year there had been 140 jobs created on the site and there was a significant area of additional land available at the site which the Council were looking to take forward.  

It was explained that the overall completed site had the potential to generate around 2,500 jobs and the Operations Director added the site was a good example of how work within the Regeneration, Economy and Growth Service was integrated in terms of initial planning application work, work in obtaining Enterprise Zone status and enabling infrastructure work followed by the work of Business Durham in terms of working with the developer and market the site as it was being built and then manage the units and attract businesses.  She explained that the businesses on site had also taken advantage of the other packages of support, examples being Corehaus and Power Roll accessing funding from the County Durham Growth Fund to fit out their units and Power Roll having investment through the Finance Durham Fund that meant they were able to locate all of their facility at Jade Business Park. 

The Operations Director noted Business Durham had worked closely with the Council’s Employability Team in terms of connecting those businesses which were looking to take on additional employees with the Team.  She added that Corehaus had noted they were very keen to work with local schools in terms of highlighting to young people the opportunities in modern construction and had been involved with the Gatsby Programme and the NELEP in respect of videos to be used in schools as regards construction industry opportunities.

The Corporate Director of Regeneration, Economy and Growth noted over 10,000 jobs across those five strategic sites and the Local Authority’s role in enabling the development, whether they were sites the Council developed directly or provided infrastructure to allow private sector development.  She added it was important to have the tools to enable development, such as financial assistance, bidding for Central Government or NELEP funding, or taking development forward as a Local Authority to kickstart a market.  The Corporate Director of Regeneration, Economy and Growth noted the excellent businesses already within the County and reiterated the importance of the Council’s ‘joined up role’ in offering the levers to help unlock the private sector so they could flourish in County Durham.

The Chair thanked the Officers and asked as regards a primary contact in terms of the key strategic sites, whether there were plans to develop more strategic sites, for example within the north of the County, and who was responsible in terms of performance of the sites.

The Corporate Director of Regeneration, Economy and Growth noted her Directorate was the contact, albeit the scale was such it was more than one individual as contact.  She added that the Strategy Team had oversight in terms of the strategic sites and their performance and in terms of individual sites it varied, as described by the Operations Director, with some being Council led with Business Durham and some being private sector led, with the Council being able to quickly navigate any contact as required.  In respect of future sites, the Corporate Director of Regeneration, Economy and Growth noted the CDP, adopted in Oct 2020, set out the overall employment land supply over the next 15 years and while many of those sites were not included as ‘strategic sites’ they were important. 

She added it would be important in terms of articulating the opportunities in terms of the strategic site and also the 12 main town centres and noted that, while it would be fantastic to have a strategic site within a walkable distance, it was not always practical and therefore it was important that the Council worked to ensure the opportunities that were created were accessible to people via appropriate transport modes and having the requisite skills.

Councillor C Marshall thanked the Corporate Director of Regeneration, Economy and Growth and all of the staff within the Teams supporting the work in relation to job creation and the strategic sites.  He noted that bringing forward development on the scale that was happening in County Durham was the envy of the North East and did not just happen overnight. 

He noted that such developments would start off as a plan, but would rely upon Planning, Assets and also on being able to have a plan that the private sector could buy into. 

Councillor S Wilson left the meeting at 10.52am

Councillor C Marshall noted the partnership working in bringing sites forward, adding it could be useful if Members of the Committee were able to visit the strategic sites and speak to the businesses and asked how the Council was able to sell the sites and County to business.  He also noted a report would be considered by Cabinet in respect of the new Headquarters for the Council and asked for clarification in terms of the 4,000 jobs for Phases 1 and 2 of the Aykley Heads site and whether they were dependant on the Council Headquarters moving from its current site. 

The Chair noted a tour of the strategic sites for Members was an area being looked into by the Service.

The Operations Director noted the Council worked with a number of partners in terms of inward investment, including Invest North East England, which represented all the Local Authorities in the region and responded to inward investment enquiries where companies were looking for a location in the North East.  She added that in terms of strategic sites, businesses were looking for what was available in terms of the site and the premises, i.e., was there a suitably sized site available and how quickly could a business move into a premise.  She noted that the Council would also provide support in respect of those areas already mentioned, such as skills development, workforce recruitment, the environment, housing, however, the first and foremost question was ‘is there a suitable site available’.  The Operations Director noted the Council was in the process of updating its inward investment propositions in having information available for inward investors around the key sectors in the County, what skills they would find in the County, the University, and also support and funding packages that were available.  She noted over the last 18 months there had been a great deal of change, given the pandemic, and the update in relation to propositions would have a focus on those areas of strength in the County such as existing businesses, infrastructure and supply chains. 

The Operations Director noted that in addition to bringing in inward investment, it was important to continue to support existing County Durham businesses to grow and expand, adding that the Business Durham had a team looking at business engagement and account management and they spoke to businesses daily to find out what they needed to grow and expand.  She added there was a very loyal County Durham business community and there was a strong feeling that County Durham was business friendly, and that the Council was also business friendly.

The Corporate Director of Regeneration, Economy and Growth noted there would be a future report at Cabinet in terms of the issue of the Council Headquarters and therefore she would not be able to speak as regards that specifically, however, she would add that the Aykley Heads site remained a critical and strategic site, with the job numbers being based on robust forecasts and it would continue to remain a priority to maintain a comprehensive masterplan for Aykley Heads and to target and strive for those job numbers as forecast.

Councillor C Martin noted the reports represented a ‘good news story’ in terms of the investment and jobs and asked if there was any ‘bad news story’ in terms of losing a major employer and whether any lessons had been learned.

The Corporate Director of Regeneration, Economy and Growth noted that it was important when looking to create opportunities in one area, potential impacts on other areas, such as in terms of logistics and manufacturing, were considered.  She added that a number of the key sites were former sites that had been in decline and that had been renewed through development and were very different from sites in the past.  The Operations Director noted she did not know of any cases where an employer had gone, however, she noted in was important to understand that companies would not look at the County and the Council’s border, rather they would look at the North East as a whole, including the Tees Valley, and therefore it was important to be able to offer what businesses were looking for.  She gave the example of Aycliffe Business Park, where there was little room for expansion and therefore the Forrest Park site adjacent was able to help as there had been many enquiries as regards additional space with many noting they would have looked to relocate to Darlington if space had not been available.

Councillor K Early asked as regards there was now a trend towards speculative developments, or whether Jade Business Park was an exception, linking to it being an Enterprise Zone.

The Operations Director noted it had always been an issue in the North East in terms of speculative units, based on the gap between the cost to the private sector in developing such units and the rental income from such units.  She added therefore if such units were to be built there needed to be some confidence that the units would be able to be rented out. 

She noted this had been an issue in the past in the North East and noted that Jade had been build without any pre-lets, however, the Council was confident, given the location on the A19 together with being an Enterprise Zone that businesses would be attracted to the site.  She explained that it was encouraging that more private sector developers were thinking that they might be able to make speculative development work.  The Operations Director noted the lead-in time involved in bespoke development and that many businesses would prefer to move in quickly and fit out as required.

The Chair noted the forecast of jobs and wondered whether those forecasts had taken into account a post-COVID reduction in office jobs and noted only 10,500 jobs had been added in the last 12 years, adding with levels being 25 percent below the England average there was still a lot of work to be done.

Resolved:

That the report and presentation be noted.