Legal & General Capital plans to support the £350 million Newcastle Science Central, one the biggest urban regeneration projects of its kind in the UK.
The unique deal will see financial services giant Legal & General becoming a long term investment partner on Science Central alongside Newcastle City Council and Newcastle University. Legal & General Capital’s initial £65 million investment will fund completion of two buildings on premium plots 1 and 2 offering over 200,000 sq ft of Grade A office space, create 2,000 jobs and boost economic growth, and will help unlock the potential of further investment in commercial and residential plots.
This is the fourth major investment Legal & General Capital have made, supported by UKTI’s Regeneration Investment Organisation (RIO), as part of their £1.5 billion UK Regeneration Co-Investment fund, which provides early stage investment capital into large scale UK regeneration projects. This fund was developed in conjunction with the Regeneration Investment Organisation (RIO), to facilitate Institutional Investment into regeneration projects, with the facility to syndicate this with overseas investment.
The investment is the biggest property deal seen in Newcastle for decades, and Legal & General Capital’s investment follows recent announcements that a National Centre for Energy Systems Integration will be built on site. This is the third national centre of excellence secured on Science Central – along with the National Centre for Ageing and Science Innovation, and the National Institute for Smart Data Innovation – bringing the total investment to £90m since the beginning of the year.
This builds on work that has already begun on Science Central, part of Newcastle’s Accelerated Development Zone, which has seen significant progress over the past year. The landmark building The Core opened in November 2014 and is full to capacity, Newcastle University delivered the first research labs in The Key which opened in February 2016. And construction of the university’s £58 million Urban Sciences Building is also well underway, and will open in summer 2017. In addition, design work is underway for a Learning and Teaching Centre and Newcastle Laboratory which will offer high quality, incubation and grow-on accommodation specifically geared to science-based commercial activities.
The 24 acre mixed used development is set to create over 4,000 jobs, 500,000 sq ft of office space, and 450 new homes in the heart of the city.
A major milestone for Newcastle
Councillor Nick Forbes, Leader of Newcastle City Council said: “Today’s announcement is a major milestone for Newcastle, and one which sets a clear marker of our ambitions as a city.
“Science Central demonstrates that this city is committed to creating the jobs that will come to define future generations, jobs created thanks to the significant joint investments already made by both Newcastle University and Newcastle City Council.
“Legal & General Capital’s investment is a major vote of confidence in Newcastle from one of Europe’s leading investors, who have clearly recognised the enormous potential of Newcastle and the region. Securing the deal will act as a catalyst to attract further investment, putting us firmly on the map as a UK hub for the science and technology sector and creating knowledge-based jobs for future generations, sending out a strong message that Newcastle is open for business.”
Nigel Wilson, CEO at Legal & General Group, commented: “I am thrilled that Legal & General is investing in the future of Newcastle. This investment is further evidence of the power of ‘bulldozer money’ to deliver high-tech growth and jobs through regeneration in the North. Whatever the EU Referendum outcome, we need growth in the UK – and this is the way to deliver it.”
Commercial Secretary to the Treasury, Lord O’Neill said: “There are unprecedented opportunities for private sector investment into the Northern Powerhouse and today’s announcement by Legal & General Capital is fantastic news for Newcastle. Working alongside Newcastle City Council and Newcastle University, this is a landmark regeneration project that will bring enormous benefits to the area.”
“With science and education at the heart of our plans to rebalance the economy and end the gap between the north and south, this deal has the potential to be a blueprint for other cities right across the region.”
Professor Chris Brink, Vice-Chancellor of Newcastle University, said: “Today’s announcement by Legal & General Capital is a reflection of what has been achieved so far and testament to the potential of Science Central as an exemplar of sustainable urban development.
“Building on our recent outstanding research successes, with the announcement of our three National centres – the National Centre for Ageing Science and Innovation, the National Institute for Smart Data Innovation (NISDI) and the EPSRC National Centre for Energy Systems Integration – this investment will take us a step closer to realising our vision for Science Central.”
The new strategic investment partnership for Science Central with Legal & General Capital will formally seek approval from the council’s Cabinet on 22 June.