Published Wednesday, 9th January 2019

Senior councillors will consider an agreement which could see York Central deliver an additional £130m to invest in the city, as well as the housing, growth and public spaces already planned for the site itself.

The proposals form part of the York Central Partnership agreement, which sets out how the partners and landowners of the 72 hectare site - the council, Network Rail, Homes England and the National Railway Museum - will deliver ambitious regeneration plans.

The agreement details the contributions made by each of the partners, and how each of the costs will be repaid and risks rewarded as the development is delivered.

The council will deliver the infrastructure needed to open up the site, and will more than repay its original investments through both land receipts and the ability to retain 50% of business rates which would usually go to central government.

The business rates from York Central should more than repay the £35m the council is borrowing and, in the best-case scenario, could bring in an extra £52m to reinvest in future economic development across the city.

Network Rail and Homes England will invest around £55m in buying and clearing land on the site. As master developers, they will then receive a maximum of 20% return on their investment. The council could repay its initial investment and receive up to £77.1m to reinvest in building homes across the city.

Councillor Ian Gillies, leader of City of York Council, said:

“York Central is going to play a huge role in the future long-term prosperity of this city, delivering the housing, employment, public and cultural spaces the city needs.

“This agreement makes a great deal for York even better. It would mean repaying our costs and potentially rewarding our risks with an additional £130m over 15 years which would otherwise go into national funds.

“Without this partner and public sector leadership, we wouldn’t be on the brink of delivering this once in a lifetime regeneration. It is only right that York residents benefits from York Central’s future success as we reinvest in the city we love.

“The partnership is making great progress, and I’m particularly looking forward to seeing our plans to deliver affordable housing in the first phase of development.”

The partnership agreement also reaffirms some of the key principles to make York Central work for York’s businesses and residents. This includes a commitment to high quality design, homes that York needs and people can afford, and the continued role of community engagement in shaping the scheme.

Councillor Keith Aspden, executive member for economic development and community engagement, said:

“We must make sure that York Central is a well-designed community where many York residents will get their first home, start or grow a family, or choose to retire. 

 “It will have as big an impact on employment for the next generation, as Rowntrees had in the past, bringing more and better paid jobs so our young people can continue to live in the city they love. 

“Many generations will live, work and play there  – it will be a place for the whole city. 

 “Most importantly, thank you to everyone who has already shaped the York Central proposals. Your contribution has been essential to getting us this far, and will continue to play a key role in exploring opportunities and overcoming the challenges that lie ahead.”

Tamsin Hart-Jones, project lead from York Central Partnership, said:

"York Central is one of the biggest opportunities to transform York in generations and the partnership agreement is an important milestone for the next phase of the development.

"Each of the partners has worked hard to get the York Central project to this point and develop a strong vision which will help to grow the local economy and bring much needed high-skilled, high-value jobs and homes to the city.

"The collective expertise and investment which each of the partners has brought to this project has been crucial to bring the plans forward and we look forward to continuing to work closely together as we move ahead with the development."

The council’s Executive will be asked to sign up to the partnership agreement next Thursday (17 January). The report also asks the Executive to:

  • Release £6.25m to prepare the site ahead of core construction works 
  • Agree for the council to prepare:
    1. a business case to make sure that affordable housing is delivered in the first phase of the residential developments on site.
    2. proposals for economic development on the site
    3. proposals for the next phase of community development

Executive takes place on Thursday 17 January from 5.30pm and is open to members of the public or is available to watch live online from https://democracy.york.gov.uk/ieListDocuments.aspx?CId=733&MId=10476&Ver=4

The partnership agreement – who would do what?

Partner

Role

Risk / investment

Reward

City of York Council

Deliver the infrastructure to open up the site,

Attract inward investment

Potentially invest itself (for example in council housing)

Act separately as statutory planning and highway authority

 

Conduit for grant funding:

Anticipated total 37m grant from West Yorkshire Transport Fund (west Yorkshire- Plus Transport Fund) to deliver access at front and rear of the station)

Anticipated £77.1m Housing Infrastructure Funding (HIF)

Direct investment:

£35m borrowed from York, North Yorkshire, East Riding Local Enterprise Partnership against future business rates

£5m WYTF levy

£10m from Economic infrastructure Fund

 

Recover upfront investment and

up to £77.1m from land sale receipts (capped at the equivalent of HIF grant) to reinvest in housing

50% of all business rates, which will cover the loan and up to £52m additional investment for local economic investment

Homes England / Network Rail

Master developer – work with private sector partners to bring sites forward for development in line with the planning application.

 

£55m land acquisition and clearance of current uses

Return from land receipts capped at 20%

National Railway Museum

The cultural heart of York Central

As a Charitable organisation, NRM cannot undertake any development activity on non-Museum land, so will not share in either the York Central development costs or receipts

 

Invested £1.14m so far to develop masterplan within context of wider scheme

Disposed of surplus land to Homes England to integrate into overall scheme

 

 

As cultural anchor, continue to shape scheme

 

Land disposal facilitates early phases of £50m expansion plans

 

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