A report by the think tank the Centre for Cities looks at the urban transformation of cities in the North and Midlands. It concludes that the future growth of cities is dependent on the availability of commercial property.
The number of people living in Manchester Leeds and Birmingham city centres has soared. Many properties that could have been used for
commercial purposes have been converted to residential properties. This has contributed to a shortage of commercial space.
Many northern and midland cities are growing at a faster rate than London. In Manchester, job growth has outpaced all other cities in England and Wales. Many young people in particular are attracted to living in city centres for the nightlife and short commute to their place of work.
The report says that the growth of successful cities is undermined by Permitted Development Rights, which can prioritise residential development over commercial space in city centres.
The report makes two key recommendations. Firstly, city centres should be excluded from Permitted Development Rights to stop the conversion of commercial property to residential use. Secondly, to satisfy the demand for homes, the Centre for Cities recommends that planning laws be relaxed in areas outside of city centres to allow more house building. This could include controlled development in green belt areas.
The situation highlights that Commercial property investing, particularly office space, in city centres can provide good rental yields and capital growth. Commercial mortgages are available to finance property deals.