Comment

HS2 and Midlands growth: The journey

It is a common, largely false, and often repeated, misconception of HS2 that its primary driver is to reduce rail journey times between London, the Midlands, and ‘The North’.

It is clear, however, to most objective observers that HS2 will bring wide-ranging and critical benefits to the national economy, particularly at a time when our country needs to be more closely united and levelled up, as confirmed by the Budget last week.

Rather than speed, the benefits of the project should be viewed from the perspective of the additional capacity that will be created, and importantly the effect that high speed rail connectivity will have in joining-up a number of regional cities, and bringing them closer together as a key step to rebalancing the national economy. The green light given to the whole route by Government last month, despite some wavering, is fantastic news for the future economic potential of the regions and much credit is due to all those in civic, business, and academic roles who fought hard to achieve it. The Oakervee review, which led to the Government’s decision, confirmed that “the original rationale for HS2 still holds” and that the full network is needed to realise the benefits of the investment. The report references the evidence provided by Transport for the North, Midlands Connect, and other regional organisations, which set out that “improving inter-city connectivity within the North of England and the Midlands, and from there to London is vital for [regional] economies”.

The Midlands in particular stands to gain substantially from the major growth and potential future prosperity that will be stimulated by the Government’s decision. The renaissance that Birmingham has enjoyed over the last decade, since the current proposed route for a high speed line connecting the major regional cities of the country was first mooted, could be just getting started. For us, having worked on many of the most transformative projects in the city and region over the last 20 years, that is a hugely exciting prospect.

More than just a railway

Looking back at HS2’s timeline and charting this against many of the milestones for major investment and regeneration in Birmingham and the wider region, there is a clear correlation between the certainty and faith placed in HS2, as the largest proposed investment in national rail infrastructure for many decades, and the level of development confidence experienced on the ground. Please click the below link to see a timeline charting the journey of HS2 and Birmingham.

The effect of this increased confidence has prompted a wave of aspirational plan-making and new investment strategies that all seek to capitalise upon the significant capital expenditure committed by central Government. We should all anticipate, and indeed now expect, that these plans and strategies will lead to the delivery of sustainable, connected, and prosperous new places that bring opportunities to communities who in the past may have been overlooked. HS2 was always intended to be more than a railway. It will connect eight out of ten of Britain’s largest cities serving around 30 million people and will bring further significant benefits including:

• releasing capacity on the existing rail network;  
• helping to reduce freight traffic on our roads; 
• providing a response to climate change (the project is an important part of the country’s response to becoming net zero by 2050);
• integration with the major complementary transport proposals identified as needed by Northern Powerhouse Rail and Midlands Engine Rail; and 
• acting as a catalyst for jobs, economic development, and regeneration on a grand scale.

These are the more meaningful and comprehensive virtues of the project that will provide the foundations for regional success in the face of global competition for inward investment.

HS2 –rebalancing the economy

Published in 2017, the ‘HS2: Getting the Best out of Britain’ panel report, led by David Higgins (then Chairman of HS2 Ltd) championed the opportunities for economic growth in a range of sectors and across a number of regions. The report sought to demonstrate that by joining up major conurbations, HS2 will enable more effective pooling of skills, people, and capital. It also set out that enhanced connectivity will allow businesses and investors in the North and Midlands to gain better access to new markets and become more globally attractive.

With the foreword to the report setting out the paradox faced by this country, with London as a great global city, but with highly skilled regional economies lagging behind on productivity, the key purpose was to show how HS2 can help to ‘bridge the gap’ in productivity, in line with Government policy as set out in its Modern Industrial Strategy and elsewhere.

Interestingly, especially in the context of the Government’s general election victory and their linked pledges to tackle regional inequality and boost prosperity for towns and cities outside of London, the UK2070 Commission, chaired by Lord Kerslake, has recently reported on the urgent need for meaningful measures to be put in place to rebalance Britain to create a “fairer and stronger” overall national economy post Brexit.

The ‘Fairer and Stronger’ report, the second from the Commission, explains that “the economy of the UK has always been strengthened by its successive investment in new systems of transport, from turnpikes, canals, railways, and motorways”. It adds that the current networks are not fit for purpose and alongside its recommended connectivity revolution, it identifies six other essential areas of focus for the UK to ‘move up the gears’ to become a more productive, sustainable, and inclusive nation. The final report from the Commission published last month sets out a compelling case for a new ‘Economic Programme’ and a ‘Connectivity Revolution’ that represent a recommended comprehensive, large scale, and long-term approach to addressing national inequality and social division. The report calls upon the Government to ‘Go big, or go home’. Once the current uncertainties linked to the Covid-19 crisis have passed, it will have become all the more important for the Government to respond to this challenge.

Stimulating investment in the Midlands

The evidence of ‘the HS2 effect’ on the ground in the Midlands is clear. There has unquestionably been significant benefit gained from the confidence brought by HS2, encouraging major investors and developers to support the ongoing rejuvenation of the main conurbation of Birmingham and the wider region.

Given the recent momentary hesitation from Government, it is worth reflecting on the extent to which the vision for the Midlands has already started to deliver.

Early ambition was set out in the Midlands HS2 Growth Strategy of July 2015, triggered by the prospect of welcoming the largest infrastructure project in Europe to the region, and recognising the “once in a generation” opportunity to drive economic growth. The strategy noted at the time that HS2 should help to “build an economic, social, and environmental legacy for the Midlands” taking advantage of the region’s fundamental strengths.

The vision for the Midlands has been consistent in seeking to harness the unrivalled connectivity of the region, which will clearly be enhanced by HS2, to create a step-change in economic performance. It recognises HS2 as a ‘game changer’ and notes that the billions of pounds being invested in high speed rail infrastructure will create opportunities for major private sector development, together with significant job generation, new inward investment, and potential improvements to existing public transport networks to maximise the distribution of benefits across the region and provide for upgraded and integrated facilities.

Planned ‘development zones’ centred around each of the main stations within the region (at Curzon, The Interchange @ UKCentral, and at Toton in the East Midlands) have also emerged in support of the overall vision, offering a framework for major new commercial and business development, together with a significant number of new homes, and other diverse uses to attract visitors to the region. These plans acknowledge the significant net gain that can be achieved and demonstrate how new developments can provide the catalyst for local infrastructure improvements, as well as facilitating new skills and people related initiatives.

It is fair to note that many of the foundations for growth in the region already existed. For example, as identified by the Midlands growth strategy, the £600million transformation of Birmingham New Street station opened in 2015 providing a modern transport interchange hub in the heart of the conurbation. At that time, £250million was being invested in extending the Midland Metro network, with the opening of the metro connection between Snow Hill station and New Street station planned to coincide with the ‘Grand Central’ redevelopment. Other major projects in the region included the £500million Paradise development, which was early into its first phase of development in 2015, along with the £200million leisure, retail, and hotel development at Resorts World, neighbouring what was then the recent £300million upgrade to Birmingham Airport, including the £70million runway extension. But these foundations only serve to support the case for HS2 as a catalyst that will keep economic growth on track, including a number of major development and infrastructure projects that will be underway or delivered before the first HS2 services start selling tickets.

The Oakervee review itself notes evidence showing signs of business activity on the back of the announcement of HS2. These include the fact that Deutsche Bank, HSBC UK, PWC, BT and HMRC, have all chosen to relocate or expand their presence in Birmingham, generating thousands of new jobs, since the granting of Royal Assent for Phase One of HS2 in 2017.

As we discussed in a recent article, The Curzon Masterplan, the Eastside growth of a ‘knowledge and enterprise’ quarter and the number of permissions granted over the last 12 months for developments such as One Eastside, Exchange Square and Martineau Galleries highlight the level of investment and development currently taking place in Birmingham city centre.

A city on the up

Whether measured by the scale, number, height, or quality of the planning permissions being granted in the city; the calibre of local, national, and international investors and their commitment to the city over the longer term; or by the shift to delivering social value, well-being, and more sustainable outcomes for the built environment; there is no doubt that Birmingham is a city on the up.

This is well exemplified by the recent approval of the Martineau Galleries  proposals on the doorstep of the HS2 Curzon Street station, in the heart of the city centre and within the Curzon Masterplan area. A site that has long been earmarked for major mixed-use regeneration and which has suffered false starts in the past. The proposals will create a vibrant mixed-use neighbourhood that will include up to 1,300 new homes, together with shops, bars, cafes, leisure facilities, a hotel, and over 100,000 sq m of new offices and workspaces. The proposals befit the city’s international aspirations and are consistent with the emerging environmental goals of the city; aiming to achieve BREEAM excellence while delivering upon a number of inclusivity objectives by providing substantial accessible public open space and affordable housing. Recent development proposals reflect a change in mind-set within the city, which in turn suggest that longevity, as well as social and environmental responsibility could become hallmarks of the next phase of renaissance in Birmingham.

However, there is still much more that can be done. What should drive our next 20 years working in Birmingham and the Midlands is the prospect that this current wave of ambition, stimulated in large part by the advent and emergence of HS2 over the last decade, could bring benefits for all parts of the region’s population. That on its own would represent an outstanding legacy for a national infrastructure project that has always been about much more than just speed.

For more information on our work in Birmingham or how HS2 may impact the Midlands please get in touch with Mat Jones, Rosie Cotterill or Ben Williams.

18 March 2020