Christchurch Borough Council THE FUTURE ROLE OF LAND AT BOURNEMOUTH AIRPORT IN THE SUB- REGIONAL ECONOMY FINAL REPORT WE/30385/GM/JR March 2008 Offices also in: Cardiff Manchester Newcastle upon Tyne Nathaniel Lichfield & Partners Ltd 14 Regent s Wharf All Saints Street London N1 9RL T 020 7837 4477 F 020 7837 2277 london@nlpplanning.com www.nlpplanning.com
LON2006/WE30385-001
CONTENTS EXECUTIVE SUMMARY 1.0 INTRODUCTION... 1 2.0 ECONOMIC CONTEXT... 3 3.0 BOURNEMOUTH AIRPORT AND THE NORTHERN DEVELOPMENT ZONE... 15 4.0 DEMAND & SUPPLY OF EMPLOYMENT LAND IN THE SUB-REGION... 21 5.0 POTENTIAL DEMAND FROM GROWTH SECTORS... 35 6.0 ECONOMIC DEVELOPMENT AT OTHER UK AIRPORTS... 49 7.0 DEVELOPMENT CONSTRAINTS... 61 8.0 FUTURE ECONOMIC POTENTIAL OF BOURNEMOUTH AIRPORT... 69 9.0 CONCLUSIONS... 87 APPENDICES REFERENCE DOCUMENTS APPENDIX 1: ORGANISATIONS CONSULTED APPENDIX 2: SUMMARY OF ECONOMIC POLICY AIMS APPENDIX 3: ECONOMIC STATISTICS APPENDIX 4: THE AIR FREIGHT & AIRCRAFT MAINTENANCE SECTORS APPENDIX 5: DEVELOPMENT AT SELECTED UK AIRPORTS APPENDIX 6: FACILITIES AT SELECTED BUSINESS PARKS APPENDIX 7: REVIEW OF MIXED USE EMPLOYMENT SITES ELSEWHERE APPENDIX 8: PREMISES REQUIREMENTS OF DIFFERENT USES APPENDIX 9: NOTES OF INTERVIEWS WITH KEY ECONOMIC BODIES LON2006/WE30385-001
LON2006/WE30385-001
1.0 INTRODUCTION 1.1 This economic study has been commissioned by Christchurch Borough Council to examine the future potential role, within the sub-regional economy, of employment land at Bournemouth Airport. The findings of the study will inform the Council s Local Development Framework (LDF), including the preparation of the Core Strategy and an Area Action Plan for Bournemouth Airport. 1.2 Bournemouth Airport ( the Airport ) consists of both the operational airport and the adjoining 80 ha strategic employment site (known as the Northern Development Zone). Part of the latter has been developed as the Aviation Park business park, as well as containing a number of aviation-related activities requiring airside access, but the majority of the site remains undeveloped. The focus of this study is on the role of the strategic employment site as opposed to the operational airport, although where these are related either currently or potentially then both are considered. 1.3 The key outputs required from this study are: an overall vision and context in which development of the site can take place; advice on the types of economic sectors that the site could attract and be promoted for; and guidance on how the site could best be promoted and brought forward to achieve its potential. The study therefore focuses on the economic potential of the site. While setting out broad development principles, it does not consider site conditions and constraints in detail nor aim to produce a masterplan for the site s development. 1.4 In this context, the study addresses a number of key questions as set out in the Borough Council s brief for the study: What is the relationship of land at the airport within the existing economy of South East Dorset and the wider region? What level of employment is development at the airport likely to provide in the short, medium and long term? What role should the following types of employment play at the airport: aviationrelated employment, knowledge-based employment, major office developments, other types of B class employment, lower order employment uses? Should certain types of the listed employment development be specifically promoted, avoided or restricted in some way? What is the role of the airport for aviation-related businesses? LON2006/WE30385-001 1
Should the airport s northern sectors have an overall development vision? What type and size of premises should the airport be developed for? What are the key locational requirements of future occupiers of the site? Is there a need for any associated development at the airport which would complement or enhance its economic role e.g. hotel and leisure development? Methodology 1.5 The study draws upon the following information sources: published economic and employment data for the sub-region; a review of relevant policy and economic strategy documents; employment land studies for nearby districts; previous studies of Bournemouth Airport; experience of development at other UK airports; interviews with key stakeholders and relevant organisations (see Appendix 1). 1.6 The report is structured as follows: a brief review of current economic conditions and recent trends in the South East Dorset sub-region provides the context for considering the future economic role of the strategic employment site (Chapter 2); analysis of the current economic use of the land at the airport, including planned proposals at the airport and identification of infrastructure and other constraints on future development (Chapter 3); a review of the current demand and supply of employment land in the subregion based on published studies, commercial property market factors and competition from other strategic employment sites (Chapter 4); consideration of the main drivers of demand for employment land in the subregion and the sectors most likely to be attracted (Chapter 5); a review of experience of economic development at other relevant airports within the UK, including the scale and types of economic activity attracted, levels and pace of development, degrees of success and the factors that have been influential (Chapter 6); assessment of the future economic role of the airport within the sub-region, the sectors and types of activities for which it offers most competitive advantage, and development options to maximise the site s economic potential (Chapter 7); measures required to bring the site forward and encourage its development by appropriate sectors (Chapter 8) Chapter 9 provides overall conclusions. LON2006/WE30385-001 2
2.0 ECONOMIC CONTEXT 2.1 This chapter establishes the economic context for the study by examining economic conditions within the South East Dorset sub-region and the South West regional economy. This is important in identifying the strengths and overall characteristics of this local economy, to provide a background against which the economic role of the Airport can be considered and to identify factors likely to influence the nature and level of future demand for employment land at the Airport. 2.2 For this study, the South East Dorset sub-region includes the districts of Christchurch, Bournemouth, Poole, Purbeck and East Dorset. This defines the area referred to as the local area or local economy (Plan 2.1). Plan 2.1: Sub-regional context of Bournemouth Airport Bournemouth Airport South East Dorset sub-region Bournemouth Airport LON2006/WE30385-001 3
The South East Dorset Sub-Region 2.3 The sub-region is an attractive area on the south coast and on the south-eastern edge of the South-West region. Although much of the area is rural, the Bournemouth- Poole-Christchurch conurbation within it, with some 350,000 residents and over 167,000 jobs, is the largest conurbation in the region after Bristol. It is also larger than some sizable cities such as Southampton. Bournemouth Airport lies some 7 km to the north east of this urban area (Plan 2.1). 2.4 The Poole/Bournemouth/Christchurch area is a popular retirement destination and has an older age profile than the South West region. 1 Only some 56% of the subregion s population are of working age, compared to 60% across the region. The area also suffers from net outward migration of 15-24 year olds, especially graduates. 2 2.5 In terms of accessibility, the area has some limitations. It lies some 50 km west of Southampton and some 15 km from the M27 motorway, which provides links to Southampton, Portsmouth and London. Otherwise, the A31 and A35 offer the only direct routes westwards from Bournemouth, towards Weymouth and there is no direct motorway link to Bristol. Christchurch, Bournemouth, Poole and Weymouth all have direct rail links to Southampton and London, the latter two hours journey time from Christchurch. The Port of Poole is the base for a number of cross channel ferries. Economic Centres 2.6 The main centres of current or potential economic activity and employment within the sub-region include: the 80 ha Aviation Park at Bournemouth Airport, which contains a range of engineering and aviation related firms with around 3,500 people employed on the airport site as a whole; the Lansdowne office quarter in central Bournemouth which contains various large financial services firms; the Winfrith Technology Centre, a 50 ha employment site between Poole and Dorchester, which has been acquired by English Partnerships to develop a science park; 1 Christchurch Local Plan Adopted 2001 2 Raising the Game. Economic Development Strategy 2005-2016. Bournemouth, Dorset and Poole Economic Partnership 4
Cobham Plc, which is a major aerospace and defence systems manufacturer based in Wimborne, north west of Bournemouth, and which plans to establish a national centre for advanced engineering at this location; various industrial estates, the largest of which are Ferndown (57 ha) in East Dorset, the Holton Heath Trading Estate (10 ha) in Purbeck and the Nuffield and Mannings Heath estates in Poole; few sizeable office parks, the only significant one, Acorn in Poole, being relatively small; the Bournemouth University innovation centre; the Enterprise Pavilion, an innovation centre in Poole for the creative industries, which contains design and digital media firms as well as managed office workspace; the Full Sail Ahead regeneration scheme planned to the east of Poole town centre aims to provide new housing and modern office space. 2.7 Further afield, Southampton forms the nearest major economic centre, containing a major port, an airport and related activities, and this centre is likely to compete with South East Dorset for investment. Economic Trends 2.8 Current economic conditions and recent trends in the sub-region are summarised below, with detailed statistics contained in Appendix 2. These allow the recent performance of the sub-region s economy to be compared with the South West region and Great Britain. 2.9 There were some 212,800 employee jobs in the sub-region in 2005. This reflects job growth of 22.1% since 1997, higher than both the South West region (19.9%) and the national rate (16%) (Table 1). Within the sub-region, Bournemouth had the highest share of jobs and the highest growth rate (36.2%). 2.10 The sub-region s economy is dominated by the service sector. In employment terms the largest sector is public administration, education and health, partly reflecting an Arts Institute and University in Bournemouth. This sector accounts for just over 25% of all jobs, a slightly lower share than regionally (28.2%) or nationally (26.9%). Its job growth between 1997-2005 (21.7%) has also been below national rates (29.7%). 2.11 The finance, IT and business services sector, with 22.6% of all jobs, is more highly represented in the sub-region than regionally (18.4%) or nationally (20.7%). This is a 5
high value added sector where employment has grown by some 60% locally since 1997, twice the national rate (31%). 2.12 The distribution, hotel and catering sector accounts for a quarter of all local employment (24.8%), slightly lower than regionally (26%) but similar to the national average (24.1%). In recent years employment in this sector has grown by 17%, but underperformed national growth in this sector (24.4%). 2.13 In contrast, the manufacturing sector has declined since 1997, losing over 27% of its jobs, but this is similar to manufacturing decline nationally. Manufacturing now accounts for only 9.5% of all employment in the sub-region, less than regionally (11.4%) and nationally (11.1%). Some of this can be attributed to decline in traditional sectors such as engineering. Figure 2.1: Principal Sectors of Employment in the Sub-region % of Employment 50 45 40 35 30 25 20 15 Sub-region 1997 Sub-region 2005 SW Region 2005 10 5 0 Manufacturing Construction Distribution, Catering & Hotels Transport & Communications Finance,IT,other business services Public Admin, Educ & Health Tourism Source: Annual Business Inquiry 1997 & 2005 2.14 Despite the presence of the airport, the transport and communications sector accounts for only a small proportion of employment in the sub-region (4.5%). This share is slightly lower than for the region (5%) and Great Britain (6%). Growth of only 13.4% since 1997 has also been slower than that national average (20.2%). 6
2.15 Reflecting the area s attractive environment and the coastal location, tourism is an important sector locally. It employs some 18,600 people (8.7% of all employees), the same proportion as regionally, but more than England (8.1%). 2.16 There are some 14,000 firms in the sub-region, with few large firms and 74% employing fewer than 5 employees. This compares to 76% in the region and 67% nationally (Table 4). Major private sector employers include British Aerospace, Allied Signal (an engineering and manufacturing firm based at the Airport), Siemens, Wayfarer Transit Systems, Wessex Power, and various financial sector firms such as Abbey Life Assurance, Standard Life Healthcare, Barclays International, Unisys Insurance and JP Morgan Chase. 2.17 Between 1994-2006, the stock of VAT registered firms in the sub-region grew by 15.6% with some 2,150 new registrations. This rate of growth was slightly higher than that of the South West (11.5%) and the UK (14.3%) (Table 5). Three year survival rates in the sub-region vary by district but are generally similar to those for the South West region (73%) and higher than the UK rate (70%) (Table 7). 2.18 Using new business formation rates as a measure of entrepreneurial activity, the subregion overall had 37 registrations per 10,000 population in 2005, similar to the UK and regional average. Between districts, performance varied from East Dorset 47 per 10,000 population, to 37/38 in Bournemouth and Poole and 25 in Purbeck (Table 6). This suggests an average level of entrepreneurism in the local area. 2.19 Within the sub-region there was some variation in GVA between districts. In Poole it was 15,800, above the UK average ( 15,600). Bournemouth s GVA exceeds both national and regional averages, but in Purbeck the rate was below both. 3 4 These figures paint a picture of relatively low productivity, but may reflect the above average rate of retired people in the sub-region (Table 17). 2.20 The sub-region has very low unemployment, with 3,130 claimant unemployed persons, averaging only 1% of the resident workforce. This rate is lower than the South West (1.5%), and less than half the national rate (2.4%). In Christchurch, unemployment is particularly low at 0.9% (Table 8). This pattern of unemployment below regional and national rates has prevailed historically. Despite this, there are 3 Source: The Dorset Countywide Monitoring Report 2005. Bournemouth Borough Council, Dorset County Council and Borough of Poole. June 2006. 4 Gross Value Added (GVA) measures the contribution to the economy of each individual producer, industry or sector, by estimating the value of its outputs, less purchases and taxes. 7
some pockets of higher unemployment, particularly in inner areas of Bournemouth and Poole. 2.21 Long-term unemployment 5 across the sub-region (13%) is similar to regional levels, but lower than nationally (17%) (Table 8). As not all unemployed workers claim benefit, actual unemployment levels in the sub-region are significantly higher. 6 2.22 The sub-region s low unemployment results in a tight local labour market. In May 2007, there was only 0.7 of a claimant unemployed worker for every notified job centre vacancy in the area. This is much lower than the ratios for the South West (1.2) and GB (2.6) and indicates a low supply of available local labour to meet any growth in employment (Table 9). 30 Figure 2.2: Occupational Profile of Labour Force % of Employment 25 20 15 10 Sub-Region South West England 5 0 Managers Professional Associate profess& technical Administrative Skilled trades Personal service Sales Machine operatives Elementary Source: 2001 Census 2.23 Within the sub-region, there appears limited scope to expand the indigenous local labour supply should employment demand grow further. This reflects a local economic activity rate the proportion of working age residents who are economically active averaging 81%, which is slightly lower than the regional average (82.4%) but above the rate for England (78.9%) (Table 10). 5 % of claimant unemployed who are out of work for over 12 months 6 International Labour Organisation measure indicates total number unemployed and actively seeking work and is typically double the claimant rate. 8
2.24 The sub-region s labour force has a very similar profile by occupational group to the South West region and national profile, but with relatively more residents in management and administrative occupations. However, proportionally slightly fewer people work in professional, machine operative and low skilled elementary occupations than regionally and nationally (Figure 2.3 and Table 11). 2.25 Local skill levels appear below average. The proportion of the sub-region s working age residents with a degree or higher qualification (16%) is much lower than the regional and national averages (both 27%). Similarly, the proportion of working age residents with no qualifications (24%) is much higher than regional levels (10%) and approaching twice the national average (14%) (Table 12). Compared with the region, Poole, Bournemouth and Christchurch have fewer workers with NVQ level 3 qualifications or higher, and skill gaps are reported in the manufacturing sector in particular. 7 Outward migration of younger residents with graduate skills is also a problem. Such skill deficits can constrain development of a modern knowledgebased economy. Figure 2.3: Sought Occupation of Claimant Unemployed in the Sub-Region Elementary/unskilled (21.8%) Managers (9%) Professional (7.7%) Assoc Prof/ Technical (9.0%) Administrative (11.5%) Machine operatives (10.3%) Sales (12.8%) Personal services (6.4%) Skilled trades (11.5%) Source: Nomis, 2007 2.26 As shown in Figure 2.3, among claimant unemployed workers in the sub-region, the most sought occupations are for elementary/unskilled work (28%), sales and customer services (21%), skilled trades (10%), and administrative work (11%). However, demand for managerial, and professional and associate professional occupations is still slightly higher than comparative proportions at regional and 7 Raising the Game, Bournemouth, Dorset, Poole Economic Partnership, 2005 9
national levels. At the same time, demand for elementary/unskilled employment (28%) is lower than both regional and national averages (Table 13). 2.27 Across the sub-region, average wage levels vary. In terms of resident earnings, all districts except Poole fall below the national average, and average wages in Bournemouth, Poole and Purbeck are also below the regional average. This probably reflects a significant proportion of employment in lower paid tourism, catering and public sector occupations. The proportion of households receiving income support in the sub-region (6.6%) is, however, lower than the South West (8%) and England (10%) averages (Table 14). 2.28 In terms of housing affordability, looking at incomes of 20-39 year olds, the ratio of house prices to incomes is 5.6 in Christchurch, 6.1 in Bournemouth, and 5.3 in East Dorset. 8 All these are higher than the regional (4.9) and national ratios (4.4), indicating housing affordability problems in the sub-region. Inward Investment 2.29 The Bournemouth/Poole area attracted a significant number of larger financial sector firms in the late 1980s and early 1990s. These included relocations from the London area and often involved backroom office activities of firms such as Standard Life Healthcare, Barclays International, American Express, JP Morgan and Abbey Life. This reflected the area s attractive lifestyle factors, good links to London and the South East of England and relatively low commercial property and employment costs. However, more recently, levels of inward investment to this area have been low with the only major incoming businesses being the Royal Mail (1996) and the Portman Building Society (2001). This may reflect greater competition from locations in the South East as well as a few sizable business parks or other employment locations. Knowledge-based Industries 2.30 Knowledge-based industries are those sectors of the economy where value-added is derived from the intensity and accumulation of knowledge, often fostered by the increasing use of technology. This includes the following classifications: 9 high-technology manufacturing (e.g. pharmaceuticals, office machinery and computers, aircraft and scientific instruments); 8 Christchurch Economy & Labour Market Profile. Dorset County Council May 2007. 9 Based on the definition adopted by the Organisation for Economic Co-Operation and Development (OECD). 10
medium high-technology manufacturing (e.g. motor vehicles, electrical machinery, chemicals, non-electrical equipment); and knowledge-intensive services (e.g. post and telecommunications, financial intermediation, insurance and pensions, computing, research and development). 2.31 Firms within this sector tend to grow faster and have greater future potential than many other sectors. This may reflect greater processes of innovation, and the application of knowledge to generate new products and services, which can extend to more traditional activities as well as advanced technologies. 10 The relative proportion of these knowledge-based activities is considered an important indicator of an economy s competitiveness and skill-base, and of its prospects for future growth. 2.32 As Figure 2.5 below illustrates, the proportion of knowledge-based employment in the sub-region is broadly similar to that of the region and Great Britain. These include high technology manufacturing firms clustered in Poole and East Dorset, such as Cobham Plc. However, most of this is concentrated in Bournemouth, where its 31% of knowledge based jobs is the 4th highest proportion in the region. Poole (with 28%) is also well represented but other districts shares are well below the national average. Figure 2.5: Knowledge Economy Employment, 2003 100 % 90 80 70 60 50 40 30 20 10 21 20.6 21.7 79 79.4 78.3 Knowledgebased industries Other employment 0 Sub-region South West GB Source: The Knowledge-Driven Economy, Regional Economic Strategy and Regional Spatial Strategy in the South West of England 10 Boddy, M. (2005) The Knowledge-Driven Economy, Regional Economic Strategy and the Regional Spatial Strategy in the South West of England. Report to SWRDA. 11
2.33 Bournemouth (37%) had the highest employment growth in this sector between 1998 and 2003, followed by Poole (24%), which respectively had the 2 nd and 4 th highest growth across all districts in the South West region. Commuting 2.34 The sub-region experiences a low level of both in and out-commuting. In 2001, excluding trips to work within the sub region, some 24,900 employees travelled out of the area to work, equivalent to 12% of resident employees. The principal destinations were New Forest, Southampton, North Dorset and Salisbury. This outflow was offset by approximately 19,750 employees travelling into the sub-region to work, predominantly from New Forest and Weymouth & Portland districts, as well as North and West Dorset. These in-commuters were equivalent to just 10% of all employee jobs across the sub-region. This indicates a relatively self-contained local economy where most of the residents both live and work within it. 2.35 Internal commuting patterns within the sub-region indicate a relatively high level of commuting between Bournemouth, Christchurch and Poole. Poole is the most common destination for employees, attracting some 30% of all out commuting trips from the sub-region. Bournemouth is the most common destination for commuters from Christchurch and other districts. Conclusions 2.36 The above indicators point to the sub-region being a relatively prosperous area with a relatively good performing local economy, with above average levels of entrepreneurial activity, low unemployment and a tight labour market. The main strengths of this local economy, which will influence its ability to support new employment space, include: a high quality environment and an attractive place to live for skilled staff; strong employment growth across the local economy, and reasonable growth in the knowledge economy sector; the presence of a university with associated innovation centre, and a high technology centre at Winfrith; a diverse economic base not overly reliant on one sector or industry; an established centre for financial services; above average growth in new business formation; and the presence of local port and airport services. 12
2.37 However, potential weaknesses and threats to future economic growth include: lack of a strong image as a business location; relatively poor strategic motorway access and limited public transport infrastructure, especially west of Bournemouth. limited attraction of inward investment in recent years, reflecting a possible lack of sizable employment sites and competition from other locations; above average proportions of retired people, not contributing to economic growth or the local workforce; low unemployment and high economic activity rates which potentially limit local labour supply, although there is scope to claw back some residents working outside the area; problems of housing affordability, exacerbated by below average wage levels, which may hinder staff recruitment and retention; and net out-migration of younger skilled graduates and lower than average skills in the local labour force. 13
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3.0 BOURNEMOUTH AIRPORT AND THE NORTHERN DEVELOPMENT ZONE 3.1 This section examines the current function and characteristics of Bournemouth Airport and the Northern Development Zone (NDZ) that adjoins it. It also examines the planned growth of the airport that may affect future demand for employment land in the area. Current Role of Bournemouth Airport 3.2 The Airport is located some 9 km north east of Bournemouth and 4 km north west of Christchurch. Current road access is from the single carriageway B3073 which lies approximately 1.5 km from the A338 dual carriageway leading to the M27 and M3 motorways 25-30 km away. 3.3 Bournemouth Airport and the NDZ together comprise some 366 ha of land. The entire operational Airport site is designated as Green Belt and some 67 ha comprises areas of nature conservation interest. 11 The Airport s main function is catering for short haul leisure/holiday flights, although it contains some aircraft maintenance and leisure flying activities. While no commercial airlines operating scheduled flights currently have an operational base here, it does contain the training centre for National Air Traffic Services (NATS). Some 480 jobs are currently involved in the operation of the Airport. 3.4 The Airport has one operational runway some 2,270 metres in length, which is longer than those of other regional airports such as Exeter, Bristol or Southampton, but much shorter than Heathrow or Gatwick. It has a passenger terminal constructed in the early 1980s but no dedicated cargo terminal. 3.5 Although still relatively small, Bournemouth Airport has been one of the UK s fastest growing regional airports in recent years. In 2005/06, it handled some 917,000 passengers, a 70% increase over the previous 5 years. Much of this increase has come from introduction of new routes by budget airlines supplementing growth in chartered holiday flights. 3.6 Some 84% of all flights are to international destinations, higher than the average for other UK regional airports (63%). Nearly all (83%) of these destinations are in 11 Bournemouth Airport Masterplan 2006-2030 15
western Europe, primarily holiday rather than business destinations. These include Alicante, Lanzarote, Marseille, Prague and Venice. The remaining 16% are UK domestic flights, mostly to the Channel Islands on small turbo-prop aircraft, or services to Scotland or Ireland. 12 Ryanair operate one daily flight to Glasgow (Prestwick) and Dublin. The airport handles occasional long haul chartered flights using larger aircraft, but there are no long haul scheduled flights. 3.7 However, compared with other airports in the region and the London airports which firms based in the sub-region could reach relatively easily, Bournemouth Airport has a limited number of routes to business destinations, and some of these are to less convenient airports (Table 3.1). It does have a service to Amsterdam, a hub airport from where connections to other destinations are possible. Table 3.1: Comparison with Other Airports Airport Max. Runway Length (metres) No. of Destinations Bournemouth 2272 37 8 Southampton 1723 48 16 Exeter 2087 49 13 Bristol 2011 107 35 London Heathrow 3902 170 150 London Gatwick 2565 175 63 Source: Airport websites, 2007 No. of Business Destinations 3.8 In terms of aircraft movements, commercial passenger aircraft account for a relatively small 16%. Indeed, some 60% of the 83,000 aircraft movements at the airport in 2005 related to a leisure flying club located on the north eastern area of the site. Air cargo flights accounted for only 4% of movements with some 11,600 tonnes of cargo handled in 2005, mostly newspaper, magazines and mail (Table 3.2). Table 3.2: Aircraft Movements at Bournemouth Airport in 2005 Movement Type Number % Light aero club 49,980 60 Air Taxis, Private and Business Aviation 13,000 16 Military/Maintenance 3,780 5 Cargo/Mail 3,240 4 Passenger air transport 13,000 16 Total 83,000 100 Source: Bournemouth Airport Master Plan 2006-2030. Aircraft movement = a take off or landing. 3.9 In terms of carriers, Palmair use Bournemouth as a base and operate many of the summer leisure destinations noted above. Low cost airlines make up many of the remaining services. Easyjet flies to Geneva and a service to Grenoble will start in December 2007, whilst Ryanair flies to destinations such as Barcelona, Dublin and 12 Figures from Bournemouth Airport Master Plan 2006 2030. 16
Pisa. Package tour operators, particularly Thomsonfly and Thomas Cook Holidays make up the remainder. 3.10 The Airport serves a sub-regional market, with approximately half of all departing passengers residing in the Bournemouth-Poole conurbation, and others in Weymouth, Dorchester, Salisbury, Southampton, Portsmouth and Basingstoke. The addition of more low-fare routes has increased the airport s share of passengers from beyond this area and its main competitor is Southampton airport. Although the latter offers more destinations, Bournemouth is reportedly able to offer more competitive fees and handling charges. Future Role of Bournemouth Airport 3.11 The Airport s 2007 masterplan, produced on behalf of Manchester Airport Developments Ltd, sets out the future scale and direction of growth at the Airport. Based on the Aviation White Paper, and taking into account the recent growth of lowcost airlines at the airport, its commercial passenger throughput is forecast to increase to up to 4.5 million passengers by 2030. The main increase in air movements is anticipated in commercial, predominately low-cost airlines, with up to 39,000 movements at the airport expected per year by 2030 (Table 3.3). However, no significant increase in general aviation or cargo traffic is expected in this period. Table 3.3: Forecast Commercial Passengers and Aircraft Movements Year Passengers Aircraft Movements 2005/06 932,000 13,000 2009/10 1,800,000 18,000 2014/15 3,000,000 27,000 2029/30 4,500,000 39,000 Source: Bournemouth Airport Masterplan 3.12 In terms of air freight, Bournemouth Airport currently handles a modest 5,500 tonnes annually. 13 Whilst Government forecasts estimate the Airport has potential to handle up to 80,000 tonnes of freight by 2030, the Airport masterplan does not predict that the amount of freight activity will increase significantly in this period. 14 The Airport s planned growth is expected to result in some 740 direct FTE operational jobs by 2015, and some 940 by 2030. 3.13 To deal with the expected increase in passengers, planning permission has recently been obtained to extend and modernise the existing terminal building. This 13 CAA Annual Airport statistics, 2005 14 Department of Transport UK Air Freight Study Report (2005) 17
permission introduces quotas on numbers and types of night time flights, whereas no restrictions on night time flying had previously existed. The Northern Development Zone 3.14 To the north of the Airport operational area lies some 80 ha of land, known as the Northern Development Zone or Aviation Park. Some 67 ha remains undeveloped. 15 This area is allocated for employment use in the adopted Christchurch Local Plan and is excluded from the Green Belt. In addition, a 5.6 ha site on the western boundary is allocated for a Mechanical Biological Treatment (MBT) plant. 3.15 Several environmental designations apply to the adjoining area, including an SSSI and several other sites of nature conservation interest within the Northern Development Zone itself. The flood plain of the Moors River runs along the site s eastern side. The Local Plan also designates a highway reserve corridor and a need for junction improvements from the north east side of the Northern Development Zone to the A338. This designation has existed for many years but with no progress made. 3.16 The Northern Development Zone is split into two distinct parts by a disused runway. The majority of this land is unoccupied. The land to the east of the disused runway called Aviation Park East, or the Eastern Business Park contains a small number of aircraft maintenance operations, some small scale industrial uses such as vehicle repair and storage, a recycling firm and a local flying club. 3.17 The land to the west contains some 134,000 m 2 of floorspace occupied by 200 office and industrial firms with some 2,700 jobs. 16 B2 and B8 uses account for about 75% of space and B1 uses only 15%. This comprises a mix of modern office/industrial premises and older industrial buildings and hangars. There is a wide range of activities such as aviation related uses, freight forwarders, aircraft furnishing designers, marine-related activities, engineering firms, environmental consultants, a removal firm, plant/tool hire, and steel fabricators. A Basepoint Centre containing 70 firms in small serviced-offices and workshops is also located in this area. 3.18 Strategic road access to much of this site is currently limited. It lies approximately 1.5 km west of the A338 to the north east of Bournemouth, a road which has good links to the M27 Motorway. However, access to both the Northern Development Zone and the 15 Based on data from Dorset County Council on remaining employment land at 2005 18
Airport is off Parley Lane (B3703), a secondary road. This means that business vehicles frequently compete with airport passenger traffic and there are periods of congestion. Road access to the eastern part of the site is worse, being partly served by a single track road. This poor strategic road access appears a major constraint on development of the eastern side of the Northern Development Zone; while a road link to the A338 could greatly improve this, the cost is understood to be very high. 3.19 The site also has a number of other current limitations as a high quality employment location or for major development: while premises near the western entrance are modern and of good quality, many other industrial buildings on the site are much older and in poorer condition; nature conservation designations and a river adjoining and/or within the site form a constraint to development and to improving road access; no on-site amenities or services, such as shops, hotels or restaurants, other than one small café and also very few services near the site; this may make the area less attractive for staff of potential relocating firms, and for office based firms in particular; very little structural landscaping and no street lighting; some long tenant leases on large areas of land; the planned MBT plant on the western edge of the site may constrain higher value uses nearby; lack of coherent internal road structure with some roads not suitable for HGVs; very poor quality roads on the eastern part of the site; poor public transport accessibility with no railway station nearby and only one bus service between Bournemouth and the Airport, which does not operate at times convenient to employees at the site; attempts to improve the frequency and speed of services have, so far, been unsuccessful. 13 while the adjoining Airport raises the site s profile to some extent, the location is rather remote from town centre facilities and experiences some aircraft noise. 3.20 A masterplan was prepared on behalf of the Airport owners in 2003 to guide future development of the NDZ land. 13 This considered several options for development with and without the A338 road link. The preferred option was based on this road link and proposed a mix of industrial and office development taking up most the NDZ site. Within this it included a number of different zones of distinctive character zones such as a significant area designated for industries requiring airside access, a high quality office area, a standard quality office area and a general industrial area. This 16 Northern Development Zone at Bournemouth Development Feasibility and Masterplan final report. EDAW, DTZ Peter Brett Associates and Davis Langdon and Everest. July 2003. 19
document indicated that the scheme could not be fully funded by commercial development of the site Conclusions 3.21 Bournemouth Airport is a small regional airport which has experienced strong growth in recent years from budget airlines travelling mainly to leisure/tourism destinations and domestic, business and freight traffic is not anticipated to increase significantly. The Northern Development Zone adjacent to the airport is a very large site capable of accommodating a wide range of aviation and non-aviation related employment uses. It is a site of strategic importance with some profile advantages from location beside a growing airport, and containing land with airside access. However, the Zone s potential, particularly the eastern half, is limited by poor strategic and local road access, lack of public transport access, traffic congestion, adjoining nature conservation and floodplain areas, and distance from the range of services typically found in town centres. 20
4.0 DEMAND & SUPPLY OF EMPLOYMENT LAND IN THE SUB-REGION 4.1 This chapter examines market demand for employment premises and land in the sub region. It also assesses the current and emerging supply of employment land and premises across the sub-region, including planned new developments and potential sites that could compete for new investment with the Northern Development Zone at Bournemouth Airport. Demand 4.2 A general picture of levels of demand for different types of employment premises was obtained from discussions with property agents active in the area and from Council economic development departments, as well as analysis of enquiries for business premises. 17 A general point underlying this analysis is that the commercial property market in the Bournemouth/Poole/Christchurch area was identified as quite distinct from areas such as Southampton to the east and Weymouth to the west, with most demand generated from within the area and relatively little inward locations of any scale. Office Space 4.3 Demand for office space across the sub-region was identified as steady, rather than strong. Most of this is for premises in the range 200-1,000 m 2, but with a few enquiries for larger units (2,000-4,000 m 2 ). Much of this demand is locally generated and focused on the two largest town centres, particularly Bournemouth and to some extent Poole. Some is from existing financial services firms looking to expand or obtain better premises. However, there is little interest from major new office occupiers, who tend to go to the M3/M27 corridor near Southampton. Demand tends to be more for modern, high specification premises with low running costs and good parking/accessibility for staff. In contrast, much office accommodation in Bournemouth is perceived as dated and relatively expensive for its quality and age. Despite this, vacancy is generally low and some speculative development in the town centre has occurred recently. 4.4 There also appears to be good demand for office accommodation in Poole, especially for high quality, prestige offices. Council officers here received a relatively large 17 Using enquiries recorded by Property Pilot Database of Dorset County Council 21
number of enquiries for this type of office space, mostly from firms looking to relocate from London, but this demand could often not be met. Whilst some firms still occupy lower grade offices, these are considered less likely to retain a long term presence in the area until larger more modern premises become available. Some of this demand may be met through the planned regeneration scheme in Poole town centre. 4.5 Elsewhere, whilst sites are occasionally developed, there is more limited demand for office space although the Arena scheme at Ferndown industrial estate has attracted various office occupiers in small, modern business units. Industrial (B1(c), B2 and B8) 4.6 There is strong demand for industrial space across the sub-region, again from firms already based in the sub-region. Vacancy levels on existing sites are generally low and available sites are taken up relatively quickly. This is particularly for smaller units (100-200 m 2 ), mostly freehold, as well as for 1,000-2,000 m 2 design & build units. Most demand is for B1(c) and B2 but there is also significant demand for small/medium sized B8 units and half of all enquiries are for warehousing. The prime locations for this demand are Poole, Ferndown, Ringwood and Bournemouth Airport. 4.7 Much of the relatively high take-up in Poole is considered to be a result of very high demand for start up B1(c) and B2 industrial units of around 200 m 2 from local businesses. New developments of small, flexible business units, such as the Arena scheme at Ferndown, are taken up very quickly. Other Indicators of Demand Table 4.1: Enquiries for Commercial and Industrial Premises Size (sq. ft) 0-999 1000-1,499 1,500-1,999 2,000-4,999 5,000-25,000 25,000-50,000 Over 50,000 % by Use Industrial 150 13 14 192 41 12 10 25% Light Industrial 301 14 8 238 20 1 6 34% Warehousing 77 14 5 113 23 8 13 14.6% Offices 235 19 9 128 17 0 0 24% Serviced offices 41 2 0 5 0 0 0 2.8% % by Size 47% 3.6% 2.1% 39.1% 5.8% 1.2% 1.7% Source: Dorset County Council Property Pilot database Note: Enquiries only apply to Bournemouth, Poole, Christchurch and East Dorset districts. 4.8 A further indicator of demand is the level of enquiries for premises made in four of the sub-region districts to local agents and Dorset County Council between 2006-07 (Table 4.1). There may be some double counting in these figures if the same 22
enquiries are made to different districts, and some inconsistency with other sources has been identified. 4.9 However, subject to these caveats, the data suggests that most demand is for some type of industrial premises (73% of enquiries) with reasonable demand for office premises (27%). It also shows the strong focus on smaller premises, with 91% of enquiries for units under 465 m 2 with very little demand for premises above 2,300 m 2. The strongest demand is for very small units below 95 m 2. 4.10 Business surveys undertaken by the sub-region districts as part of employment land reviews also provide some indication of potential future demand from the growth of local firms. The robustness of this data is limited by not all districts being surveyed but some general points emerge. 4.11 The majority of responding firms are not considering relocating. Although the proportions differed across the sub-region, only between 5% (Purbeck) and 15% (Poole) indicated they were considering moving, whilst in Christchurch the figure was 25%. Of those considering a move, most wished to remain within the sub-region and most wanted larger premises. Demand was mainly for modern, purpose built industrial as well as office accommodation within the sub-region. In terms of space requirements, most firms wanted relatively small/medium sized premises, from 100 m 2 to 1,000 m 2. Demand at Bournemouth Airport 4.12 Good demand was reported for existing premises at the Airport, with 3-4 enquiries per week. 18 Most of these were for industrial premises of 200-450 m 2 and predominantly from existing tenants or firms already based within the sub-region. There have been few direct enquiries for office space, reflecting the type of premises available. Demand is influenced by the quality of premises available, many being older units such as hangars, but with strong demand for the newer premises. A vacancy level of only 2% suggests good demand for the premises available. 4.13 The main attractions of the site are seen as its diverse range of premises by size, the relatively low cost of the space, easy parking and a reasonably accessible and environmentally attractive location within the sub-region. Some firms also like the prestige of an airport location. The main constraints are limited road access, the lack 18 Based on discussions with Airport Estates Office of Manchester Airport Developments Ltd 23
of premises to meet demand and the poorer quality of some units, which need improvement if tenants are to be retained. In this context, the Airport site is competing with areas such as Ferndown, rather than Southampton, which is seen as a different market. 4.14 Some future demand is likely to come from a few existing aviation-related firms wishing to expand and possibly for small scale maintenance facilities from the budget airlines when they reach the stage of having 6-7 aircraft based at the Airport. There are current enquiries for large hangars (2,000 and 15,000 m 2 ) from an air livery firm and for a sales base for a private aircraft business, but these are also considering other airports. There is also some demand for hangars purely for storing private aircraft. However, a survey of around 20 other firms based at Aviation Park identified very few planning to expand and requiring more space on site. 19 Many of these firms had been attracted to the Airport site by availability of suitable land/premises and parking rather than any special features of an airport location. 4.15 A view from agents was that the Airport site offers greatest potential for industrial uses which should occupy the bulk of the site. Part of it would also provide a good office campus site, which the sub-region currently lacks, but it would not attract large occupiers which would go to the M3/M27 area. Some occupiers also prefer town centre locations and currently planned schemes in Bournemouth will compete for these. Demand would only support about 20% of the total area for office use, up to about 10 ha. This would require a master planned approach, with distinct office and industrial areas, and careful phasing. Any office element should be located at the gateway(s) to the site and would require a high quality environment to be attractive. Some speculative development would probably be required to kick-start the scheme. 4.16 There were also other views that the future role of the Airport land should not be constrained by short term views and current market conditions. It was noted that bringing forward suitable sites in the area has generally attracted demand and that provision of premises/land for knowledge based firms may change current patterns of demand to some extent. Employment Land Supply 4.17 The assessment of land supply is based on recent Employment Land Reviews by the sub-region districts as well as consultation with commercial property agents and 24
planning officers in these districts. These found that the sub-region contains a reasonable range of employment sites of different sizes and types but with some gaps, as described below. Industrial Estates 4.18 Most of the large industrial sites are concentrated in Poole. These include the Nuffield (64 ha) and Mannings Heath (91 ha) industrial estates. Both these sites have reasonable strategic road access, accommodate large industrial and distribution uses and are located north of Poole town centre. The port of Poole is also a significant industrial area containing freight handling facilities and large amounts of warehouse and storage space. Along with smaller industrial estates located nearby and the large Ferndown estate in East Dorset, these sites comprise the main industrial supply of the sub-region. 4.19 Only a few significant sites are located in Bournemouth, the largest being Yeoman s Road (14 ha) to the north of the town which contains manufacturing and warehouse units. Several industrial sites are located elsewhere in Purbeck and East Dorset which appear to accommodate spill over demand from the Poole-Bournemouth- Christchurch conurbation. These include the large Ferndown industrial estate in East Dorset (57 ha) and the Holton Heath Trading Estate in Purbeck (10.3 ha). These sites have relatively good transport links to the conurbation and accommodate a range of large manufacturing and distribution units. Adjacent to Holton Heath, Admiralty Park (12.7 ha) contains predominantly small B1 units at low density. Office Sites 4.20 The sub-region lacks any significant office park at present. There are some office firms at Aviation Park West, and a cluster of financial and business services occupy office space in Bournemouth and Poole town centres. The Lansdowne area in Bournemouth is an established office quarter near to the railway station, but largely developed in the late 1980 s. Chase Manhattan Bank and JP Morgan also have large office sites beside the Hospital. Until very recently, there had been no significant speculative development in Bournemouth for 15 years but some developments are now coming forward. Elsewhere in the sub-region, Acorn Business Park in Poole is a small office park which is full, while small office areas lie in centres such as Swanage and Wareham. 19 Telephone survey carried out by NLP in August/September 2007 25