Newcastle is the regional capital of the North East with a diverse, service led economy. The city has a population of 293,000 and forms an integral part of the Tyneside conurbation. This is the seventh largest in the country, with a population of 775,000 people.
Newcastle has seen extensive commercial and culture led regeneration over the last 20 years, which has changed the structural dynamics of a local economy that once relied on heavy industry and manufacturing to one based around professional, scientific and business services. Data from the Centre for Cities shows that Newcastle boasts one of the best records for creating private sector jobs over the last five years of any UK city.
The Newcastle economy is performing strongly with the highest wage growth of any UK city in 2016/17 at 6.3%, supported by GDP per capita growth of 4.4%. Tourism growth at 7% per annum is well ahead of the 4% national average, whilst the city's next generation of talent comes from the two highly regarded universities, with a student population of over 50,000. With a 55% graduate retention rate, the future of the city appears to be in good hands.
The development is prominently located in a vibrant residential area, half a mile to the east of the city core and a short walk from Newcastles busy Quayside. Public transport is excellent with a major bus route and Manors Metro station both close by. The recent development of student residential schemes close by has created a willing audience to underpin the ongoing regeneration of the Ouseburn Valley, and its diverse range of venues, bars and incubator commercial space.
The design uses red brick, exposed steel, metal cladding and extensive glazing, reflecting and respecting the urban surroundings, whilst creating a prominent landmark structure. The scheme will include sector leading levels of amenity space comprising:
We are instructed to seek a full funding package including interim finance for the development at a purchase price in excess of £21,000,000 (Twenty-One Million Pounds).
Based on a site purchase price of £1,500,000, this would show a purchaser an expected gross yield of 6.98% and a net yield of 5.06% after adopting operating costs of 27.5% of gross rent.