Assetz® News - Transport to property gain

Transport to property gain

19th June 2008 |

The benefits of good transport links to the property sector have been frequently raised, with many cases noted of these helping to add to the value of property, be it commercial or residential. A recent instance of this was the comments of Paul Collins, property editor of investment website BuyAssociation, about Manchester.

Mr Collins predicted that the funding for new transport links that the city region is lined up to receive as a quid pro quo from the government of implementing a congestion charging system will be a major factor in raising the value of homes in the area with good connections. In comparing it with London, which already has its own charging system, he stated: "We've seen in other cities - particularly in London - that if you've got a good public transport network then prices will go up, so it should be a real help."

One of the areas of Manchester already lined up for some extra funding is the Metrolink tram service through the east of the city (the line in question will be extended further east to Ashton-under-Lyne if the charging scheme goes ahead). In a presentation on plans for that part of the city in the next ten years.

Referring to the Metrolink expansion, the chief executive of the New East Manchester development corporation, Eddie Smith, said today he wanted the eight new stops in that part of the city to be "place making stops", with a comparable effect that locations in London gained from being near underground stations, reports Crains Manchester Business.

Mr Smith was making the comments as he outlined to property developers a ten-year plan for east Manchester that involved wide-scale development of tits property sector, mentioning that future projects at Central Retail Park and Sport City were in the pipeline, these being the two ends of an area that he saw as being part of an extended city centre in 20 years time.

So while some transport developments may make residential properties in more valuable because they can take those living out of the city centre into it, Mr Smith clearly believes the city centre can be expanded outwards, which based on the plans of the development body will mean the building of a lot of both commercial and residential properties.

But the development of better transport links has also been hailed as away of boosting the property sector - particularly the commercial segment - in the heart of cities themselves. Writing in the Birmingham Post, Ed Jones and John Dillon of commercial property consultancy Lambert Smith Hampton said that the plan by architects Urban Initiatives for the Southside area of the city centre around New Street Station has great potential to boost the property fortunes of the area.

As well as noting the four large skyscrapers planned for the vicinity and the potential to be second only to the new Eastside project (which in many ways may be compared to what is planned for east Manchester) in providing much-needed new office space for a city that is "bursting at the seams" right now, the authors commented that the station redevelopment itself was vital.

Explaining the benefits of the doubling of capacity that will accrue from the redevelopment, the pair wrote: "The knock-on effect for the commercial property sector is that with easier access, more people will opt to work within the extended heart of the city. For businesses looking to recruit the staff they need, it will be a major boon."
The likely effect, they suggested, could be compared with the "very positive regenerative effect" seen in central London in and around Kings Cross and St Pancras due to the large amount of redevelopment investment that has occurred there.

So whether in Manchester, in Birmingham or in London, it seems the development of better transport links is the key to the growth of the suburban residential markets and the expansion and enhancement of city centres, driven by improvements felt by the local commercial property market.