Out of Town: Kingsway Business Park

KINGSWAY Business Park is one of those schemes that seems to have been around forever.

The development, which has been the recipient of of more than £30m-worth of public sector funding, had a tortuous birth, with developer Wilson Bowden having to fight through several legal battles and make planning case law during a complicated site assembly process which took the best part of a decade.

Moreover, since plots became available at the beginning of 2008 following a two-year programme of infrastructure and service works, it has come under criticism for not attracting major employment-generating tenants quickly enough, with the town’s new MP Simon Danczuk previously describing Kingsway as an “example of big promises and flashy rhetoric failing to translate into reality”.

Danczuk has subsequently become much more positive about the park, and not only because he has subsequently moved from being in opposition to becoming Rochdale’s sitting MP.

He recently made an appearance on the park for the ceremony to hand over the huge 869,000 sq ft distribution centre by JD Sports. The Bury-based sportswear retailer will now begin its own fitout including an automated order picking system, and the centre should be ready by the end of spring 2011.

Wilson Bowden has also just secured lettings for the two remaining speculatively-built units on the park to Redwood Distribution and to utilities firm EON, who have taken 32,290 sq ft and 20,451 sq ft erspectively.

The company’s development director, Robert Grafton, said that a bid for support from the second round of Regional Growth Fund money would be made to assist with building more speculative units on plot H, which is a prominent site running alongside the M62.

“That’s the closest one to the motorway and is the most likely to attract spec funding given the profile,” said  Grafton.

The neighbouring plot J – a 60-acre site representing one of two huge parcels of available land on Kingsway – is also currently attracting interest from an occupier looking to build a 600,000 sq ft unit. Grafton said that it is conducting “detailed discussions” with the company looking to take the unit, which had settled on Kingsway Business Park following a region-wide search for a suitable site.

On the adjoining Plot I, Grafton said the firm is in the final stages of ironing out a deal with a company that will look to occupy a 220,00 sq ft manufacturing/warehouse unit.

“We’re hoping for a decision imminiently,” he said.

The long-anticipated deal between Kingsway and De Vere Hotels for a Village Hotel at Plot C – the closest plot to the spur leading directly from the M62 – is also likely to be signed soon, said Grafton, with a start on site by De Vere anticipated by the end of summer.

This will kick-start activinty at the southern end of the site closest to the motorway, with interest also being shown in three office buildings of between 10-12,000 sq ft on the same site. Meanwhile, at the townside end towards Kingsway and Rochdale town centre, sister company David Wilson Homes recently began enabling works for a residential scheme to build 160 executive homes.

Peter Gallagher of P3 Property Consultants, said that the residential homes “had always been part of the consent for the site”.

“The only difference is that it’s being brought forwards slightly earlier in the programme,” he said.

Once complete, Wilson Bowden will begin work on a “village centre” at the townside entrance, for which it has already secured planning. The centre is likely to contain a 10-12,000 sq ft foodstore, pub/restaurant, a budget hotel, some small office units and some retail units for local amentities such as a child care centre, hairdressers, newsagents and dry cleaners.

Gallagher said that the facilities will help its cause when it comes to attracting tenants to other other plots on the sprawling site, including the huge Plot T and plots N, P & Q earmarked for office space.

These site at the furthest part of the site from the motorway, overlooking the Stanney Brook conservation area and are all close to the new Metrolink stop due to open at the end of 2012.

He argues that there are misperceptions about the length of time it has taken to develop Kingsway due to the tortuous nature of the site assemby process.

“There’s an impression that it’s been around for years, but the infrastructure was only completed at the end of 2007 and the road through the development was only co-0opted in Spring 2008. Since then, we’ve dropped in a couple of major occupiers a year,” he said.

“We’re now 1.05m sq ft in and there’s more of the low-hanging fruit that we expect to drop off the tree soon.”

Indeed, he said that after envisaging a 15-year development programme for the site, Wilson Bowden now expects to have completed the scheme at a much earlier date. It could even make a profit on the £50m ploughed in to the development to date.

The other major issue that has had to be grappled with over the past 12 months is the NWDA’s role in the project, and what happens to its investment. Kingsway Business Park is the biggest legacy asset on the NWDA’s book by some distance, and there had been concerns that alongside other NWDA assets the site could end up for sale to the highest bidder.

However, Wilson Bowden said that it has agreements in place which allow it exclusivity over any land parcels drawn down for development and there is a 25-year site management agreement that any likely successor to the agency (most likely to be the Homes and Communities Agency) will need to honour.
 
“There is absolutely no question of Wilson Bowden losing ‘ownership or control of the Kingsway site,” said Gallagher. “In that sense, it is business as usual.”