Philip Woolner is joint managing partner of Cambridge auctioneer Cheffins
The announcement that Michael Gove is proposing the development of 250,000 new homes in the Cambridge region in an attempt to turn it into the UK’s version of Silicon Valley has been met with trepidation.
While it makes sense to capitalise on the dominance of Cambridge in the UK life sciences and wider tech sectors, it is essential that the government is careful not to kill the golden goose. Too much development without major pre-planning for services and infrastructure could be damaging to the elements which makes this area so attractive to many. Both world-leading corporations and individuals come to Cambridge because of the lifestyle on offer; the schooling, the countryside and the beauty of the city, not only for jobs.
Unless Mr Gove clearly lays out his plans on how to address the area’s infrastructure issues including transport and utilities, and exactly how this development can be built sympathetically, there is likely to be little support from the local community. It should also be noted that Silicon Valley is hardly an exemplar of sustainable development; it has seen a major urban sprawl with little planning, which has created shortages of housing, infrastructure and resources. And there are also queries to be raised about how this plan fits within the wider levelling up agenda. Initially plans had been to spread wealth to other areas of the country, and this announcement, combined with the £1.9bn-worth of housing funds which Mr Gove’s department has returned to the Treasury, leaves question marks over the prevalence of an overarching industrial and business strategy. While we all believe that the knowledge economy will be what drives the UK’s growth, this needs to be given a measured approach, spreading the wealth and the development throughout the country.
It can’t be denied the need for life sciences space in the Cambridge Cluster is becoming increasingly acute. Some demand has been satisfied, however there is still a vast level of requirement within the market, with supply having been tantamount to zero for two years now. This has led to prices growing at pace, with rents now in the region of circa £65 per sq ft for the most sought-after locations. It is certainly important that Cambridge is able to service these requirements and remain attractive for the leading life sciences occupiers, however development of lab space is quite different to tripling the size of the city in only two decades. Cambridge is already a centre of investment, and saw Blacksone’s BioMed investing circa £850 million into delivery of lab space throughout the Cambridge Cluster in 2021. This record level of investment which is set to provide over 800,000 sq ft of space has underpinned the future expansion of the Cluster, however the announcements made by the government go quite a few steps further. And while this could potentially be a fantastic news story for corporate Cambridge, the region’s suffering services need to be taken into account.
There is no doubt that demand in Cambridge is huge, for both housing and for commercial property. However it appears that Mr Gove has somewhat shot from the hip with this announcement, with little detail on how, why and when the government intends to start this plan and whether this will form part of a larger overarching industrial strategy for the nation. It is a clear recognition, however, of the importance of Cambridge and the surrounding region to the UK economy, but without a wider context, it does seem to be putting a lot of eggs in one basket.”
