Development (Economic Development) Sub-Committee 30 November 2005
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D516
Wednesday, 30th November, 2005
Contents |
MEETING OF DEVELOPMENT (ECONOMIC DEVELOPMENT) SUB-COMMITTEE
Members present: Councillor M. Browne (Chairman); the Deputy Lord Mayor (Councillor Convery); and Councillors Crozier, D. Dodds, Empey, Jones, P. Maskey, McCann, McCarthy, Newton, Smyth and Stoker.
In attendance: Ms. S. McCay, Head of Economic Initiatives; Ms. S. Watson, Economic Development Manager; and Mr. N. Malcolm, Committee Administrator.
Apology
An apology for inability to attend was reported from Councillor McClenaghan.
Minutes
The minutes of the meeting of 2nd November, which had been printed and circulated, were taken as read and signed as correct.
World Trade Centre
The Sub-Committee considered a report regarding the establishment of a World Trade Centre for Belfast. A copy of the report, with the exception of Appendix 1 referred to therein, is set out hereunder:
“Purpose of Report
To provide Members with an update on plans for World Trade Centre, Belfast.
Background
Members will be aware that following the meeting of the Development (Economic Development) Sub-Committee, 7th September, 2005, two options were presented for consideration concerning the development of World Trade Centre Belfast. These included:-
Option 1
To pursue the World Trade Centre (WTC) concept as a virtual model whereby Belfast City Council works in conjunction with external agencies, such as Invest NI and the Northern Ireland Chamber of Commerce and Industry (NICCI), to develop a single
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integrated interface for business support in Belfast. This would involve the formulation of appropriate legal agreements between bodies based on joint approaches to international trade and investment.
This option need not involve any physical changes to the location of Belfast City Council's Economic Development unit, Invest NI or Northern Ireland Chamber of Commerce and Industry as it would rely on virtual/internet collaboration supported by regular joint meetings.
Option 2
This option involved the progression of the WTC concept as a physical development whereby Belfast City Council would enter into a contract with the private sector to deliver the project. Actual terms and conditions naturally would need to be investigated and acted upon at the outset along with the precise role/contribution of Belfast City Council within this project. Should a commercial property be developed as a WTC, it would be necessary to ensure a physical presence within the building for business contact.
At this meeting, Members agreed to progress Option 1 with a report to be submitted to a future meeting and a further report for Option 2.
Option 1 – Development of a Virtual World Trade Centre for Belfast
Over the past two years much work has been undertaken to develop the World Trade Centre concept for Belfast, which has included the development of a business plan and consultation with both public and private sectors agencies.
In essence the primary objective of World Trade Centre Belfast is to reposition Belfast in the international business market by changing perceptions of the city as a place within which to live, do business and visit – this necessitates a stepped change in the organisation and management of existing programmes and agencies linked to international trade including Invest NI and Northern Ireland Chamber of Commerce and Industry. The WTCB could provide a renewed focus and support in this area of activity for businesses as well as lending enhanced credibility and support for the regeneration of the City’s international identity. It will also provide an opportunity to avail of previous services provided by the First Stop Shop that relate to international trade.
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Virtual World Trade Centre Objectives
WTC Belfast has the ability to develop and deliver, with the Council and other public and private stakeholders (including NICCI and Invest NI), a strategy and plan to promote Belfast as a world class location within which to live, work, invest and visit. The related objectives would include the following:-
- to be a premier business gateway to encourage investment in and access to Belfast and Northern Ireland and to help and encourage companies to access UK, Republic of Ireland and overseas markets;
- to link and collaborate with other WTC's across the world and all other agencies and organisations, within and outside Northern Ireland, that will help the WTCB and its clients access markets;
- to develop and deliver effective and efficient business services, programmes, information and training to support business investment, start-ups and growth by focusing on commercial opportunities in trade and export and through the application of innovation, leadership, entrepreneurship, knowledge and good management practices in companies;
- to establish a membership base which will offer added value services;
- to operate at the heart and be a key influencer of the Belfast business community, working in partnership with and generating commitment from a wide range of stakeholders, demonstrating measurable and positive achievements.
Developing the Virtual WTC for Belfast
This virtual approach ensures that WTC Belfast could be launched in 2006 with the development of economic development services and products managed and co‑ordinated by Belfast City Council. This will include some of the previous activities delivered under the Belfast First Stop Shop.
Some of the existing services and products delivered by Invest NI and NICCI would continue to be delivered by these organisations but branded under the WTCB.
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World Trade Centre Belfast (WTCB) structure
The structure of the WTCB to comprise three functions substantially integrating the functions of the relevant agencies (see Appendix I).
- International Trade and Investments - Business Development - Marketing and Communications
A number of benefits exist in the proposition to integrate existing projects and programmes into the WTCB brand, through the virtual model.
- Business customers will find it easier to identify appropriate services to meet their needs;
- Joint marketing of services will result in less market confusion and lower marketing costs;
- A stronger negotiating position will be developed by the joint activities of the partners to both rationalize services (eliminating duplication and inefficient services) and building new services to meet market need, as well as attracting new funds in to build these services.
Virtual WTCB
The virtual model presented today to Members allows Belfast City Council to work in conjunction with external agencies such as INI and NICCI to develop a single integrated interface for business support in Belfast initially under International Trade and Investment. This would involve the formulation of appropriate legal agreements between bodies based on joint approaches to international trade and investment. These will include:-
- Single point of contact for companies between BCC, INI and NICCI. - Co-ordinated external trade mission programme including planning, recruitment, delivery and follow up. - Co-ordinated delivery of business support programmes on export development. - Referral service for all external enquiries received through the WTC portal. - Integrated marketing and promotional campaigns of Belfast abroad.
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Financial and Resources
A key requirement for the development of WTCB will be the resources required to develop the virtual WTCB. Whilst the majority of costs will be absorbed by the re‑branding of existing programmes and initiatives a number of items will be required including to take forward the virtual model.
DETAIL COST (£)
Set-up
Appraisal of programmes/projects/equipment costs/network participation/portal/development
20,000
Brand Development and marketing and communications
65,000
Industry engagement programme 15,000
TOTAL 100,000
Conclusion
To proceed with the development of a virtual WTC, lead by Council and incorporating the international activities of outside agencies including Invest NI and NICCI.
There are now a number of steps that need to be undertaken over the course of the next few months to activate WTCB. These are:-
(i) Enter into negotiations to develop a tri-partite relationship between BCC, INI and NICCI. (ii) Activate the World Trade Centre Portal. (iii) Participation in WTC network meetings. (iv) Develop a branding and communications plan and commence implementation. (v) Engage with private sector regarding membership potential and participation on WTCB. (vi) Integration of FSS Services into the WTC concept. (vii) Identify private sector property developer to partner the World Trade Centre Licence.
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Environmental Implications
None.
Equality Considerations
None.
Capital City Strategy Reference
To drive the economic growth of Belfast.
LED Plan Reference
To support and develop business growth and competitiveness.
Budgetary Implications
£100,000.
Recommendations
(i) To note the comments of the report and approve the virtual model that positions Belfast City as the lead organisation within World Centre Trade Belfast.
(ii) To approve expenditure of £100,000 to develop virtual WTCB.
Decision Required
To approve the foregoing recommendations.”
In answer to Members’ questions, the Head of Economic Initiatives indicated that the proposed virtual World Trade Centre would be more than a website which contained links to various organisations. It would involve the Council working with such agencies as Invest Northern Ireland and the Northern Ireland Chamber of Commerce and Industry to encourage investment in Belfast and to assist Belfast-based businesses to access markets outside Northern Ireland. She indicated also that those two Bodies had committed themselves verbally to the project and that appropriate legal agreements would be prepared. She stated that the World Trade Centre brand was recognised throughout the world and that such Centres were being planned also for Dublin, Cardiff and Edinburgh.
She informed the Members that, during the Creative Industries Showcase visit to America, the Council’s delegation had visited the Boston and New York World Trade Centres and had ascertained that there were business development opportunities which the Council was not pursuing but which could be undertaken by a World Trade Centre in Belfast. She pointed out that each city had developed its Centre in a manner which met its requirement and that the World Trade Centres in Amsterdam and Barcelona had started originally as virtual projects. The Head of Economic Initiatives reiterated that a further report regarding the possibility of the establishment of a physical World Trade Centre in Belfast would be submitted to a future meeting.
During discussion in the matter, a Member made the point that Invest Northern Ireland had on previous occasions been reluctant to promote Belfast as a single entity since it considered itself to being responsible for the development of the entire Province. Accordingly, he suggested that the Council should ensure that Invest Northern Ireland was committed totally to the project prior to expending resources in connection with the virtual Trade Centre.
After further discussion, it was
Moved by Councillor Crozier, Seconded by Councillor D. Dodds,
That the Sub-Committee agrees to the creation of a virtual World Trade Centre for Belfast, in which the Council would be the lead organisation, and that expenditure in the sum of £100,000 be allocated to the development of a virtual Centre, subject to the Council ensuring that all the potential partner organisations were committed fully to the project. In addition, should the Head of Economic Initiatives consider it to be necessary, that a meeting be sought with the relevant Government Minister to ensure that the furtherance of the virtual World Trade Centre would receive such commitment.
On a vote by show of hands nine Members voted for the proposal and two against and it was accordingly declared carried.
North Foreshore Economic Development Project.
The Head of Economic Initiatives submitted a report in relation to the North Foreshore Economic Development Project. A copy of the report, with the exception of the appendices referred to therein, is set out hereunder:
“Purpose of Report
To update members on progress made with the North Foreshore Economic Development Project.
Background
Members will be aware that the North Foreshore site is located to the north of Belfast City Centre and is bounded to the east and north by Belfast Lough. The site comprises approximately 335 acres (132 hectares).
The North Foreshore area is currently operated and owned by Belfast City Council having been acquired from the Government’s Department for Social Development. A condition of the sale is to ensure that it is managed properly and that adequate environmental protection is provided so that the site can be developed as an asset for the City and citizens of Belfast.
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As Members will recall there are three main strands to the development at North Foreshore;
- the proposal for an environmental business park on the South West corner (approx. 25 acres); - Integrated Waste Management Facility on the South East corner (approx 25 acres), and - the remaining part of the site to be used for open space/recreation purposes.
The key area of relevance to the Economic Development Sub‑Committee is the proposal for an Environmental Business Park on the North Foreshore site. Members will be aware that at the Economic Development Sub-Committee of 4th June, 2003 the Committee agreed to pay a total of £100,000 towards the Council’s purchase of the North Foreshore site for economic development activity. Following this a further meeting of the Economic Development Sub-Committee on 6th August, 2003 the Committee agreed to a business plan and economic appraisal to identify market opportunities for environmental business growth and the development of an environmental business park. Both pieces of work have now been completed.
Business Plan and Economic Appraisal Process
Following a competitive tendering process Faber Maunsell was commissioned by the Council to explore the concept of an Environmental Business Park at the site through the business plan. A summary of the key findings are contained within Appendix I.
In essence, the business plan stipulated that they North Foreshore Environmental Business Park could contain the following components:-
- Construction Waste Materials Recycling Facility - Central Environmental Business Exchange - Post incubation Starter Units - Bespoke Units - Serviced Sites - Green Retail facility - Eco-penthouse - Strategic Infrastructure - Landscaping - Park & Ride facility - Waste Management Facility
In addition to the business plan, KPMG has been commissioned to produce an economic appraisal on establishment of an Environmental Business Park at the North Foreshore site in Belfast.
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Northern Ireland Environmental Business Sector
In parallel to the economic appraisal process an in-depth study was carried out into the current state of the sector in terms of size. (Definition and explanation of the market is provided in Appendix II). The report concluded that.
- There is a positive trend in the growth of the environmental sector in Northern Ireland, particularly the recycling sector, growing an average 22.4% year on year;
- UK sources forecast the value of the waste management sector over the years 2003 – 2007, to increase from £4.6 billion to £6 billion;
- Waste is not the only growth area in the environmental sector. Legislation is also a key driver in the fields of noise and pollution prevention for example, which require measurement, monitoring and guidance, contributing to further growth of the environmental sector in Northern Ireland;
- The concept of renewable energy is also gaining in momentum in Northern Ireland. With the implementation of the Renewable Obligation and the limited number of energy companies, there is huge market potential for new companies to help meet the targets set by the Department of Enterprise, Trade and Investment;
- The environmental sector in Northern Ireland comprised a total of 218 companies employing 4500 people;
- Environmental companies vary in size and structure;
- Waste and waste management comprised 52% of the environmental sector;
- Employment within the sector had grown by 27% in the over the period 1999 – 2003;
- Turnover within the sector had grown by 43% over the period 1999-2003; and
- Turnover for the 218 companies was estimated to be approximately £200 million.
Economic Appraisal Results
A number of potential outcomes and targets, summarised below, have been identified that would steer the development of the business park development and these are contained in Appendix III. However, some of the key actions are summarised below;
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- Transforming the image and identity of North Foreshore from a former landfill site to an internationally recognised location promoting tangible job opportunities;
- Supportive policy framework;
- Need to develop social economy projects on site Potential of North Foreshore to grow the environmental business cluster;
- Establishment of a dedicated research and development facility on site to accelerate the commercialisation of academic research;
- Creation of new, sustainable jobs including a North Foreshore job matching service (LEAP). This is the new current funded employability initiative in North Belfast.
- Environmental starter units established on site
- At least one high profile environmental business to be located in the park within 12 months of opening
- Establishment of an educational facility on-site funded through the Big Lottery’s Living Landmarks programme
Components to be based at North Foreshore Business Park
KPMG carried out a high level scoping exercise to ascertain what components, as specified in the business plan, would not be feasible from a technical and informed environmental viewpoint. This exercise eliminated specific components from the original business plan and the remaining components of the site were deemed to be suitable for inclusion. These included:
Educational Facility/ Central building: Education Facility to be built and operated by the Council looking specifically at Increasing awareness of biodiversity and sustainability, conduct educational programmes on biodiversity, and recycling sustainability and managing the land for wildlife and nature conservation. It is proposed that funding for this component would be made through the Big Lottery’s Living Landmarks fund.
Bespoke & Serviced Units: Research has indicated that there are no comparable developments in Belfast. Assuming that the proposed use of the site as a Business Park is the best use, it offers close proximity to roads, rail and ports, as well as ARC21.
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Starter Units: Research has indicated that the existing provision is almost at full capacity and that waste management companies have had difficulties locating to premises previously.
Construction Waste Materials Recycling Facility (MRF): This will be a mobile facility, considered within the context of bespoke units
Preferred Option for Development: The selection of the preferred option for development was based on both qualitative and quantitative analysis. It then looked at the affordability of this option and identifies all the proposed sources of funding.
The preferred option selected included the following components.
- Infrastructure and landscape to BMAP requirements, to include general site clearance, external services, earthwork, road works and surfacing;
- Allocate 53,050m2 (13 acres) of the site for bespoke unit development and offer long term lease for all potential tenants (environmental business selection criteria);
- Allocate 19,000m2 (5 acres) of the site for serviced unit development and offer long term lease for all potential tenants (no selection criteria);
- Education Facility to be built and operated by the Council looking specifically at increasing awareness of biodiversity and sustainability, conduct educational programmes on biodiversity, and recycling sustainability and managing the land for wildlife and nature conservation. It is proposed that funding for this component would be made through the Big Lottery’s Living Landmarks fund (first call January 2006);
- Allocate 7,000m2 (2 acres) of the site for starter units to be developed and operated by a third party operator. These units will be for environmental business sector tenants only; and
- Include contractual stipulation that all building adhere to sustainable building principles.
It is intended that the project will provide the necessary infrastructure requirements to attract the private sector to develop Belfast City Council’s vision of the North Foreshore Environmental Business Park through an open development brief competition.
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Costs and funding
A detailed costing and funding analysis (Appendix III) was conducted into the requirements for the site. The overall infrastructure costs identified amounted to £5,905,061. This included £1,662,500 for an educational facility.
Members will be aware that £300,000 has already been approved for the North Foreshore project. It is intended that a further application of £4,242,561 would be required for development and therefore this project has the potential to utilise as much funding as possible. Other funding sources will be explored including various national and European sources including Belfast City Council’s Capital Programme. Belfast City Council has already agreed to submit an application to the Big Lottery Fund Living Landmarks Programme (£10-25m) for the broader community and environmental enhancements related to the project. In addition to this a further £200,000 has been earmarked from the economic development budget for development on the North Foreshore site and Members are asked to endorse this.
The ERDF element of this funding will be subject to approval by the Economics Department of DETI, with funds to be committed by December 2005 and drawn down by December 2007.
Conclusion
North Foreshore is the gateway location and so the Environmental Business Park will play a significant role in continuing Belfast’s renaissance and improve the competitiveness of Belfast and Northern Ireland accelerating technology transfer; new firm formation and business growth; fresh inward investment and the creation of new jobs.
Through the provision of infrastructure Belfast City Council will attract the private sector to develop the site aligned to the parks overall vision to create a very high quality, innovative and internationally recognised Environmental Business Park constructed using sustainable principles and which will drive economic development and growth in the environmental business sector in Northern Ireland.
Members should note that the Economic Appraisal for the North Foreshore is in its final stages and is currently under consideration. Members will receive a full update at a further meeting of the Economic Development Sub-Committee.
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Next steps
- Formal approval to be sought from Belfast City Council following economic appraisal; - Planning application made for outline planning permission. Marketing literature developed and negotiations with environmental industries commence with a view for bespoke development; - Infrastructure requirements finalised; - Development brief produced; - Develop strong relationship with both universities; - Third party deliverer for starter units identified and project developed; - Employment matching programme embarked. Through a service level agreement with North Belfast Partnership Board they are going to consult with the community regarding North Foreshore and manage LEAP; - Application to Living Landmarks, Big Lottery fund; Explore and develop funding packages.
Environmental Implications
The North Foreshore project has positive environmental implications in relation to the plans for the site.
Equality Considerations
None.
Capital City Strategy Reference
Leaving a legacy.
3.1 To drive the economic growth of Belfast
Becoming a better place
4.4 To ensure sustainable development
LED Plan Reference
Increasing Investability.
Budget Implications
£200,000
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Recommendation
That Members approve the approach to the project outlined and approve an additional £200,000 for the North Foreshore project.
Decision Required
To approve the foregoing recommendations.”
The Head of Economic Initiatives drew the Sub-Committee’s attention to various aspects of the report and stated that a report on the full economic appraisal which had been undertaken by KPMG would be presented to the next monthly meeting of the Sub‑Committee.
The Head of Economic Initiatives responded to Members’ questions by pointing out that the Council was keen to obtain community feedback and that efforts in that regard had met with little success. However, a meeting which had been arranged in conjunction with the North Belfast Partnership Board, would be held on 8th December to enable the Council to obtain the views of local residents. In addition, the project to convert the landfill gas to electricity was underway, the associated plant for which would require only a small area of land at the Site.
Following further discussion, the Sub-Committee adopted the recommendation contained within the report.
Start a Business Programme
The Sub-Committee was reminded that, at its meeting on 3rd August, it had agreed that a letter be forwarded to Invest Northern Ireland expressing concern at the considerable reduction in the budget which it had allocated to the Start a Business Programme.
The Head of Economic Initiatives reported that a response, copies of which had previously been circulated, had been received from Invest Northern Ireland indicating that the reduction in funding for the Programme had been as a result of the budgetary restrictions imposed by Central Government, the removal of European Regional Development Fund monies and the inability of Councils to make-up the shortfall due to the absence of matched funding from the European Union. The letter indicated also that the impact and effectiveness of the Start a Business Programme would be reviewed and, to that end, the Council, together with other local authorities in Northern Ireland, would be consulted on the terms of reference of the review.
The Head of Economic Initiatives informed the Sub-Committee that the above‑mentioned consultation had been completed by way of the Local Economic Development Forum and that the consultants which had been appointed to undertake the review would commence work in January. She pointed out that it was envisaged that the review would include policy implications as to its relevance to Invest Northern Ireland’s overall plan and its economic impact in terms of wealth creation.
After discussion, the Sub-Committee agreed to note the information which had been provided by the Head of Economic Initiatives.
Chairman
