Good afternoon readers - I’ve written about Manctopia, the four-part BBC series about Manchester’s building boom that started on Tuesday. If you missed it, you can find the show on iPlayer.
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"I've no doubt I'm going to get all sorts of stick and aggravation on social media," the property developer Tim Heatley told me when we spoke a few hours before he appeared on TV this week. And sure enough, when the first episode of the BBC's series about Manchester's building bonanza came to air, he got some stick. And some praise too.
Tim Heatley on his Piccadilly East site
Manctopia: Billion Pound Property Boom follows Heatley as he tries to turn the run-down area behind Piccadilly station into an area young professionals would want to pay hundreds of thousands of pounds to live. The co-founder of Capital & Centric represents the winners of the rapid changes happening in the city centre, held up in stark contrast to the losers: Christina Hughes, a single mum from Eccles who is struggling to find council housing after being priced out of her flat, and Richard and Michael, two men living in a homeless shelter.
It’s unusual for big property developers to appear on camera, and even more unusual to see one speaking his mind. It makes for good TV, and some jarring moments. At one point, Heatley spots a sex worker standing next to one of the buildings he is converting. “It does make you think, crikey we're selling apartments here, some for upwards of a million quid, and obviously it's right next to that kind of activity,” he says. At another point, he compares the regeneration of the city to a broom sweeping up a dirty floor, in which homeless people are "the dust that throws up." Is homelessness bad for business, he is asked? “Yeah absolutely, homelessness is bad for business because who wants to live in a city where people are sleeping rough in your doorway?”
Manctopia is a four-part series, and Heatley says people should watch all four episodes before judging him. He sees himself as an enlightened developer - one who raises money for homeless people as the chair of Andy Burnham’s charity and who cares about the city because he grew up in. He also has a policy of only selling flats to owner occupiers. “I know the public perception of a developer is big bad guys who want to grab the cash - I'm not like that,” he told The Mill. “I genuinely feel that what I do for a living has a lot of positive social benefits.”
Ultimately though, there are bigger issues in play than whether one developer is a good bloke. The program charts the extraordinary glut of building in the city centre (including Salford too of course) which is one of the fastest-changing urban spaces in Europe. And it has the potential to spark a conversation in the city about the economic benefits of that boom, and its social costs.
The truth is that Heatley isn’t particularly representative of the forces that are filling our skies with glass towers. Firstly because he sells his flats, and secondly because he says the vast majority of his business funding comes from domestic backers - including venture capital and private equity firms. The fastest growing sector of the Manchester building boom is funded by overseas investors, and is built for rental. Sometimes that means marketing properties specifically to buy-to-let investors in Hong Kong or Singapore, but in an increasing number of cases it means that the entire development will be owned and rented out by a German pension fund or a Chinese consortium. In this model, the flats are financial assets first, homes second - a trend referred to as the ‘financialisation of housing’ by its critics. And crucially it means the income generated by the developments are disappearing abroad, often into opaque companies registered in tax havens or to countries with appalling human rights records.
“The council is in cahoots with the real estate industry and the primary strategy to regenerate the city is through the financialisation of housing,” says Dr Jonathan Silver, a researcher at Sheffield University who also campaigns on housing policy in Manchester. He believes the city is so in thrall to overseas investors it has stopped asking for affordable housing payments or demanding that cheaper homes are built on site. “Since we emerged out of the crash, they [the council] have been extremely successful in attracting inward investment, but why were they not capturing that value?” Silver asks. As a great story in The Sunday Times last weekend confirmed, most of the big city centre developments in recent years have provided no affordable units, with developers using “viability assessments” to implausibly argue that the economics of the sites wouldn’t work if affordable housing was required.
Silver wrote a report two years ago documenting how much foreign money has flowed into property in Manchester, with global investors large and small attracted by Manchester’s cultural (football) appeal, direct flights and - crucially - unusually handsome yields (the rents are high relative to the cost of building flats here). The report showed that the majority of new developments are actively marketed to investors abroad, often before local residents even have a chance to bid on them, but it also showed why councils are so keen to get in bed with foreign investors and why they spend so much energy wooing them at property fairs in the south of France. It is estimated that Manchester City Council will make upwards of £17,737,200 per annum in additional council tax from the new developments in the centre (the ones Silver analysed as part of the pipeline in 2017), probably more because that calculation is based on all units being one bedroom. Salford will be seeing a similar uplift, and after a decade of massive local government funding cuts, these increases in the tax base are extremely welcome.
Nick Mattingly, who directed Manctopia and spent almost two years following Heatley around with a camera, says he likes how the centre is changing: “I think it's exciting that we have so many bars, restaurants, clubs, music venues - making Manchester into an international city,” he told The Mill. “When I moved here, no one lived in the city centre and it was quiet on the weekends. Now we have an incredibly dense city.” Having spent so much time with characters in the series who are struggling with housing, he says he’s concerned about about the effect on longtime residents nearby, which will be covered more in the remaining episodes. He’s also mindful of how the character of the city is mutating. “We didn't have any houses in the city centre, so this isn't about people being forced out,” he says. “It's more that people are looking in and seeing their city changing.”
How should Mancunians who care about their city think about the complex trade-offs of these lightning changes in the centre? What’s the right balance between attracting overseas investment and using our city centre spaces for community projects and social uses? The truth is that it’s too early to calculate the positive economic effects of these developments, in terms of the jobs they create and the spending they pump into the city, and to see how much of it is just disappearing abroad.
The same goes for the adverse effects like rises in private rents in neighborhoods nearby as the centre becomes more desirable, lengthening the already long waiting lists for social housing. Councils and developers circulate press releases arguing one side of the toss, but what’s needed is high quality academic research that helps us understand the economic effects at play. We also need rigorous, independent journalism in this area, which isn’t always what we get in a city where the developers can afford the best PR firms and social media teams and are among the most important advertisers for local media companies.
What’s clear is that these gentrifying building schemes are already creeping outside of the very centre into areas that do have lots of homes already, and where building towers means demolishing council blocks not car parks. That’s a story for future newsletters, but Heatley told me that when he evicted a group of artists from one of his mills, and helped to find them a new home nearby, he joked: “I'll see you in 15 years.”
A quick request: Please hit reply and take a minute to send over your views on this. What did you make of Manctopia? And how do you feel about how the city and its centre are changing? It would be great to use the expertise and experiences of Mill readers as we plan our future investigations and stories in this area.
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