Despite the obvious challenges of 2020, Leeds maintained a steady stream of new property development schemes last year, with 12 new starts, the same number as 2019. Office space was the standout sector with a record amount of floorspace delivered, whilst the residential sector remained steady. The pipeline for the coming year looks healthy, and with continued investment in the city’s infrastructure, there’s opportunity for developers who manage to secure the right property development finance, and the best sites for potential schemes.
A forward-thinking city
Of all the exciting developments going up in and around Leeds, Citu’s Climate Innovation District arguably has the most buzz surrounding it. In-line with the city’s commitment to becoming carbon neutral by 2030, the development of four-bedroom townhouses and one or two-bedroom apartments, aims to redefine city centre living, as the UK’s biggest sustainable urban community.
Each home is run on 100% renewable energy, using a state-of-the-art mechanical ventilation heat recovery system, and incorporates timber frames and solar panels to help conserve and supply energy. Outside, two acres of tree-filled green space come complete with water jetties and river views. And it’s not only the eco-credentials that make this a ground-breaking development for the city, they’re also the first family homes to be built in Leeds city centre for over 90 years.
The £161 million Leeds Integrated Station Master plan is well underway, with the new Platform Zero in passenger use from early summer, allowing more trains and better connectivity for the city. There will also be direct connectivity to the new high speed rail network HS2 and the Northern Powerhouse Rail (NPR) programme, as well as the potential for 300,000 sq. ft of new commercial developments around the station, making it a world-class transportation gateway.
Continued investment in Leeds and its infrastructure can only mean greater interest and confidence in the city, translating to plenty of opportunity for the property development industry.
Types of Leeds property development
Office space was undoubtedly the standout sector for the city in 2020. According to the Deloitte Crane Survey, Leeds saw the second highest quantum of floor space delivered since its survey began in 2006, at 667,059 sq. ft. A large chunk of this (10%) was accounted for by the transformation of the iconic Majestic, located on the doorstep of Leeds Train Station.
It’s also notably the home of the new Channel 4 HQ, so a high-profile win for both the development and the city, and is predicted to be a catalyst for further growth as well as a huge draw for the UK’s young, creative talent.
It’s worth noting that the vast majority of new office space delivered in Leeds in 2020 was funded by property development finance secured well before the pandemic began in March. The pipeline looks far more modest going forward, with 382,000 sq. ft of office space in the pipeline for 2021 and 2022 combined.
With uncertainty over how the workplace will look in a post-pandemic world, developers are also adapting their marketing strategies to promote the wellbeing and community benefits of office developments. Leeds’ One Globe Square and Globe Point are great examples of this, offering over and above the traditional office setup, with yoga classes, shared co-working spaces and business lounges.
Residential development remained steady, with construction beginning for four new developments in 2020, compared with three and four new starts in 2018 and 2019 respectively. Interestingly, all four sites are new-builds, and all are located on sites where construction had previously halted after planning permission was granted, suggesting confidence is on the up for the residential sector in Leeds. This is also backed by the fact that all four developments are Build to Rent (BTR), proving lender confidence that the rental market will continue to prove buoyant post Covid-19.
2020 property development schemes in numbers
Information provided by the Deloitte Leeds Crane Survey 2020
Ground-up development pipeline
Opportunity for developers in Leeds
It’s a great time to be a property developer in Leeds, and in fact the majority of the UK, if you have access to the right development finance, which is one of the top barriers to success for SME developers.
Property development finance is a short-term loan used to fund construction or refurbishment projects. 9 times out of 10 it makes sense to take out a loan because using someone else’s cash always proves cheaper that using your own.
Access to more funds also means you can take on bigger projects that might normally be out of reach, and run multiple projects simultaneously or without waiting to sell, increasing your portfolio and ultimately your bottom line.
The development finance market can be a minefield. It’s difficult to see beyond the big banks, and easy to miss opportunity if you don’t know where to look. Brickflow does the hard work for you by searching the market in real-time, providing instant online access to development finance.
We provide loans from lenders we know and trust, empowering you to borrow smarter, mobilise quicker and get ahead of the game. It’s the developers who can secure quality finance quickly, who will ultimately win in the war for the most competitive development opportunities in Leeds, and beyond.
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