Northern Powerhouse Is Off The Rails, And Property Will Suffer

Has the Northern Powerhouse hit the buffers? The continuing crisis with Northern Rail services comes as disillusion grows with the unfulfilled promises of George Osborne's 2012 project.

Can it be rescued or is the Northern Powerhouse delivering more disappointment than new investment?

If things had gone to plan, Manchester would now be six months away from the start of services at a revamped and enlarged Manchester Oxford Road station, whilst two new platforms — 15 and 16 — would be massively expanding capacity at Manchester Piccadilly.

Needless to say, no such thing is happening. The much-trumpeted plan — part of the £1B Northern Hub project to improve capacity on existing rail networks — died in its sleep. Instead, the Northern Rail franchise is in chaos, leading to thousands of cancelled services and long delays. Plans dating from 2014 to devolve control of the franchise to the North are now long-forgotten.

These are not the only Northern Powerhouse infrastructure projects to suffer points-failure. Ambitious and widely praised proposals for a high speed rail link between Northern cities (HS3) endured a downgrading name change (forget HS3, think Northern Powerhouse Rail) before disappearing into perpetual consultations (the latest draft strategy document from Transport for the North was published in January 2018). Meanwhile the Department of Transport slammed the brakes on a full £3B electrification of the existing crowded Manchester-Leeds route, although it somehow found the funds to support the £31B Crossrail 2 in London. The transpennine electrification was due for completion in 2018.

What went wrong? The obvious answer is the Brexit referendum. The moment Britain voted to leave the EU, Chancellor of the Exchequer (and local Cheshire commuter belt MP) George Osborne was political toast. And as Osborne's political career went up in smoke, so did the greatest advocate of the Northern Powerhouse idea.

Does Osborne's political immolation explain everything — or are there deeper problems? Manchester's property people say the answer is complicated — and the consequences profound.

Hit The Buffers

 “The recent Northern Rail issues feel like mismanagement rather than strategic neglect of the Northern Powerhouse ‘agenda’, although the Government’s commitment to the latter has been questioned since George Osborne returned to the backbenches," Cushman & Wakefield Chair of Public Sector John Keyes said.

On the principle that no good politician wastes a good crisis, Keyes suggests the Northern Rail fiasco might help put the Northern Powerhouse infrastructure agenda back at the heart of debate. Senior figures like Greater Manchester Mayor Andy Burnham have already made the connection.

"Investment in the North — especially in transport infrastructure — remains critical if the whole of the region is to share in the benefits of Manchester's booming economy. The lobby for this northern infrastructure investment, in rail at least, may well grow as a result of the Northern Rail problems," Keyes said.

"The North is still driving its own agenda, as seen by the collaborative working by city mayors. Manchester’s economy is booming, attracting inward investors who would not have looked beyond London a few years back."

According to some angry property people, a bit less talk and a little more action would go a long way after five years of well-intentioned Northern Powerhouse announcements.

Just Do Something

"Manchester is a powerhouse itself and the city has reached a tipping point, but today our rail problems are a national embarrassment and at this moment if we don’t get the infrastructure sorted the failure will work against us,” Avison Young Offices Director Rupert Barron said.

“There have been some very good strategies — lots of strategies — but it now needs implementing, because people like me who commute just want a system that works. The answer is more delivery, less money spent on consultancy, and basically just cutting the crap," Barron said.

Simple solutions would — in the current situation — go a long way, Barron said.

“Instead of the big vanity projects, how about we start by focusing on the smaller things? Getting trains from Bolton and Hazel Grove to work, sorting out the Deansgate junction with the Mancunian Way, how about some sequencing of traffic lights, that shouldn’t be too hard to organise?" he said. “HS3 would be nice to have, but the real problems we face are not getting from Manchester to Leeds, but much more local issues like getting from Bolton to Manchester. Or Hazel Grove — or anywhere in the suburbs."

And in the meantime the threat posed to Manchester's future by prolonged disputes, and failed infrastructure investment, grows ever more real.

“The danger here for Manchester property is that places with more effective infrastructure, like Birmingham, become the go-to city outside London. They could overtake us. And there’s a more local threat to the city centre because if employers think staff can’t get into it, they will move to out-of-centre locations. We’ve seen this before in the '90s, and we could see it again," Barron said.

For many property businesses the failure of Northern Powerhouse to deliver is not just a professional disappointment — it is unhelpful for their staff. Architects Hawkins\Brown launched Studio North in Manchester in 2014, the high summer of the Northern Powerhouse. The Manchester team has grown from one to 28, and it plans to grow further and insists cancellations and delays on the route to the Northern Powerhouse will not deter it. That is because it is not just about trains.

“The Northern Powerhouse agenda is and was much broader and more far reaching in as much as it also promotes better social infrastructure — delivering education and skills and making the north a good place to set up and grow a business," Hawkins/Brown Head of Manchester Katie Tonkinson said.

“Improved connections physically would certainly be helpful but we can meaningfully connect these cities in other ways and with a broader social and design agenda to get them on the map and to reflect the original and intended spirit of the Powerhouse.”

Even those who insist the Northern Powerhouse idea is not dead confess that it has got a big problem and could end up letting the region down.

“I wouldn’t equate the Northern Powerhouse with two extra platforms at Piccadilly," CBRE Senior Director for Planning and Development Iain Jenkinson said. "We shouldn’t give up on the Northern Powerhouse. You only need to look at the infrastructure projects now being promoted for overseas funding — some multibillion-pound projects — to see that the Northern Powerhouse brings economic additionality.” 

“That said, the Midlands Engine is doing this, too. They are getting their act together and projecting their vision far and wide. Whilst I’ve worked on three true northshoring operations recently, it's true that all three depended on rail infrastructure and if the Northern Powerhouse fails to deliver on that, then that will be to the detriment of the North. Combined with the Midlands getting their act together, and the importance of rail infrastructure, and the message back to Powerhouse is maybe that we need to develop some sharper elbows.”

Sharper elbows: It could work. But for miserable Northern Rail commuters, the entire Northern Powerhouse project might feel just a little bit lost.