U.K.'s Birmingham Attracting International Interest

U.K.'s Birmingham Attracting International Interest

Commercial News » Europe Commercial News Edition | By Cathy Hawker | March 13, 2014 8:44 AM ET

Birmingham, Britain's second city, is seeking to capitalize on its location at the heart of the country to promote itself as an economic and cultural center of excellence. The city's attempts to increase international investors were unveiled at the MIPIM International Real Estate Show in Cannes this March where it aimed to step out of the long shadows cast by London's economic success.

By combining Birmingham with the boroughs of Wolverhampton, Dudley, Solihull, Sandwell and Walsall and rebranding the region as Greater Birmingham authorities in the West Midlands believe it could compete with London for major inward investment.

Greater Birmingham currently has a £96 billion regional economy with Kraft, Virgin Media and Deutsche Bank among notable foreign investors. Yet the city believes it can do much better and has already had considerable success. Last year Birmingham increased foreign investment by 50 per cent and is now home to over 700 international firms with a further 20 currently in talks to relocate to Birmingham's enterprise zone. 

The USA is the city's largest international investor with German, Australians, Chinese and Indians also investing.  Germano-owned Deutsche Bank is doubling its Greater Birmingham workforce this summer to 2,000 employees and Jaguar Land Rover, another German-owned company, plans a £1.5 billion expansion of its Solihull factory.

Exports grew by 30 percent in the past two years and are so successful that the West Midlands can claim a trade surplus with China. Meanwhile in the city itself the China Railway Group is negotiating to rebuild a railway line between Birmingham airport and the highly controversial HS2 high-speed rail link that, if approved by central government, will cut travel time from London to Birmingham in half by 2026.

Construction on HS2 is planned to commence in 2016 although it faces substantial opposition within the U.K. based on cost and environmental concerns. 

Opportunities for capital investment launched at MIPIM include the Curzon Street Masterplan, one of the U.K.'s largest regeneration projects. The Masterplan covers a 141-hectare site centered on the new HS2 Terminus. Sir Albert Bore, Birmingham City Council leader claims this project alone will boost the city's economy by an annual £1.3 billion, provide 14,000 jobs, create 2,000 new homes and 6,000,000 square feet of retail, hotel, leisure and office space. 

Ninety minutes from London and with 90 percent of the U.K. consumer and business market within four hours, Birmingham's location is key to its success even before the improved rail link is built. Recent transport improvements include a £40 million runway extension at Birmingham Airport to land jumbo jets and an audacious attempt to bring the Metro tram station back to the city center for the first time in 60 years. 

Despite the latest phase of a £600 million transformation of New Street Station receiving the thumbs down from users who gave it a low customer satisfaction rating in a survey by consumer group Passenger Focus, it is shortlisted at MIPIM for an urban regeneration award. 

Birmingham's thriving manufacturing and industrial base put it at the forefront of the Industrial Revolution. Heavy bombing in WWII destroyed much of the city center and in the 1960s and 70s Birmingham became best known for its notoriously ugly concrete buildings.  

The current projects aim to demonstrate that the city has regained some of its eighteenth century prestige. Today Birmingham is home to 50,000 companies, the largest concentration of businesses outside of the capital and was second only to London for the number of start-up companies, 16,000 in 2013.

The workforce is youthful and growing helped by rental and property costs half of those in London. West Midlands has seen its population increase by 300,000 in the past decade while nearly 40 percent of residents in Birmingham are aged under 25, making it the youngest population of any major European city. 

Cultural and leisure improvements include a £189 million public library, the largest in the U.K., and a £150 million, 528,000-square-foot entertainment complex, Resorts World Birmingham, due to open in 2015. 

All of these have helped Birmingham become more desirable as shown by uSwitch Quality of Life Index naming it "The best place to live in the UK" and global HR and Financial Services firm Mercer awarding it "The best quality of life of any U.K. city outside of London". It might still play second fiddle to England's booming capital but it is making a good bid for success.

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