Appendix D Flexibiliy Facor/Margin of Choice Deskop Research
Cheshire Eas Council Cheshire Eas Employmen Land Review Conens D1 Flexibiliy Facor/Margin of Choice Deskop Research 2 Final Ocober 2012 \\GLOBAL.ARUP.COM\EUROPE\MANCHESTER\JOBS\200000\223489-00\4 INTERNAL PROJECT DATA\4-05 REPORTS\NOVEMBER 2012\CHESHIRE EAST_ELR_APPENDIX_D_07_11_12_ISSUE.DOCX
Cheshire Eas Council Cheshire Eas Employmen Land Review D1 Flexibiliy Facor/Margin of Choice Deskop Research This appendix presens he findings from a deskop research exercise underaken o idenify differen flexibiliy facors adoped by local auhoriies in England. Please noe he research represens a snapsho only and is no exhausive. Documen Greaer Mancheser Employmen Land Posiion Saemen Auhoriy / Area Flexibiliy Facor Norh Wes 20% Commens There exiss a degree of uncerainy in esablishing employmen land requiremens and here may be a need o provide addiional land o ake accoun of special circumsances such as he expansion requiremens of a paricular business. I is for ha reason ha policy W3 incorporaes a flexibiliy facor of 20%, poenially adding o he sub-region s requiremen. There was concern ha paricularly srong growh in B1 uses may no be me by he allocaions and ogeher wih he srengh of he economy of Greaer Mancheser a 20% flexibiliy facor was considered sufficien o suppor fuure economic growh. Bolon 20% Used o ensure consisency wih he regional levels and oher ELRs produced by Arup Norh Wes. Bury 0% Mancheser 20% Oldham 0% The ELR idenifies an addiional 7.44ha on op of he demand requiremen of 76.9ha. However, he poenial addiion of 7.25ha ha have been idenified in he consulaion draf Bury bu Beer sudy would effecively represen an allowance for an addiional 20%. Used as srong growh projecions, alhough considerable evidence of landless growh in recen years, a rend expeced o coninue. No flexibiliy facor has been applied. The preferred mehodology is based on pas ake up raes ha have hen been moderaed by facoring in he proporional change in B-use employmen from he Greaer Mancheser Forecasing Model. Rochdale 20% Based on previous sudies and Daa Transformaion Service s (DTS) marke knowledge. Salford 0% Sockpor 0% No flexibiliy facor applied alhough ELR consulans did acknowledge he need for i in he analysis of Greaer Mancheser Forecasing Model forecass. No flexibiliy facor applied as limied supply of available sies; may require landless growh, high densiy office developmen in he own cenre. Final Ocober 2012 Page D2
Cheshire Eas Council Cheshire Eas Employmen Land Review Documen Auhoriy / Area Flexibiliy Facor Tameside 20% Used in accordance wih Norh Wes RSS. Commens Trafford 0% No flexibiliy facor applied based on discussions and agreemen wih Trafford Council. I was viewed ha a 20% margin of choice was oo high as mos crieria for locaion by secor are he same. In addiion, i was considered ha a 20% oher uses such as leisure developmen (which is an aspiraion for he Council) could poenially be resriced from developing. Eas Midlands Employmen Land Assessmen: Audi of Employmen Land Sudies, Eas Midlands Developmen Agency, December 2010 Eas Midlands Various; in % erms and in pas year ake up erms) This relaes o he addiional margin or allowance ha is ofen added o he iniial esimae of fuure requiremens for employmen space in order o provide some flexibiliy o allow for forecasing error, developer choice, fricional vacancy, delays in sies coming forward ec. Again, he approach aken o his facor varied considerably. Whils all bu four of he 36 disrics wih ELRs made some allowance for his (excepions being cerain disrics in Leicesershire and Norhamponshire), hey used a wide range of figures and approaches: 10 ELRs added a margin equivalen o five years of pas ake-up; 6 ELRs used wo years of pas ake-up; 5 ELRs used a fricional margin equivalen o 10% of he curren floorspace sock for offices and 5% of he indusrial sock (in he Noingham Ciy Region ELR); and 3 applied a 50% uplif on op of demand; 5 used 25%, 2 used 30%/33% and 1 used 15%. There was clearly quie a wide variaion here in he level of flexibiliy applied o he original esimaes of fuure requiremens. This could have he effec of exaggeraing differences in requiremens beween differen sudies and clearly does no indicae a consisen basis for esimaing requiremens a regional level. While here may be argumens for differen facors o reflec differen local circumsances, reasons for using differen margins were no always eviden and a more consisen approach o applying any safey margin would be desirable. Final Ocober 2012 Page D3
Cheshire Eas Council Cheshire Eas Employmen Land Review Documen Norhumberland ELR Auhoriy / Area Flexibiliy Facor Commens I is sandard pracice o allow for a degree of flexibiliy, or margin of choice, in he allocaions by applying a saed facor in he demand calculaions. This reflecs he need for a fairly generous addiional allowance on op of he iniial esimae of employmen space needs for a number of reasons, including: Norhumberland Two years pas ake up figure of 20.87ha apporioned across he B-use classes on he basis of economeric floorspace growh projecions by secor As a margin for error given he uncerainies in he forecasing process; To allow developers and occupiers a reasonable choice of sies; To give some flexibiliy and decaning space while older premises are redeveloped and new premises are coming forward; and To cope wih facors such as some allocaed sies no coming forward and some redundan indusrial sies no being suied for new employmen uses. The SEEPB guidance suggess ha an appropriae margin for each use class should be based purely on how long i akes a sie o move from being a commimen o compleion, bu gives no guidance on wha hese imescales ypically are or how he floorspace allowance o reflec his margin should be esimaed. Typically, however, an amoun equivalen o 1-2 years of pas compleions raes has been used, depending on local marke condiions. Given he weak commercial marke a presen and he increasing ime lag beween he gran of planning permission and he implemenaion of he scheme, a conservaive margin of choice equal o 2 years worh of pas ake up is recommended. This is considered o be an appropriae and relaively modes margin of choice on he basis ha his allows for flexibiliy for developers whils reducing he risk of oversupply of employmen land in he Couny. Consequenly, by adding on an allowance for replacemen of losses and facoring in wo years of ake up (based on long erm rends) o allow a margin for choice, his resuls in a gross oal requiremen of 506.09ha beween 2010 and 2030. Supplemenary o his he RSS proposes ha a furher facor could also be applied o calculaing he oal need for employmen developmen in cases where, excepionally, i may be appropriae o provide addiional land o ake accoun of special circumsances. This is a Flexibiliy Facor uplif of 20%. The Cenral Lancashire auhoriies have decided o apply his facor because of he regional imporance of he area for economic developmen and he high number of regionally significan employmen sies locally. The poenial for economic growh (pos recession) remains high in Cenral Lancashire a fac no refleced in he low (4.25%) increase in pas ake-up raes applied across he whole of Lancashire. Preson, Souh Ribble and Chorley Employmen Land Requiremens. December 2010 Preson, Souh Ribble and Chorley 20% Final Ocober 2012 Page D4
Cheshire Eas Council Cheshire Eas Employmen Land Review Final Ocober 2012 Page D5