2,500 jobs boost for Sheffield thanks to property loans scheme
A taxpayer-funded property loan scheme is being hailed a success after Â£23m in payments resulted in room for 2,500 jobs in eight buildings worth Â£100m.
The JESSICA fund has kick-started schemes across the region which would still be on the drawing board, including 3 St Paul’s, Steel City House and the NUM building - all in Sheffield city centre - and new units on the Advanced Manufacturing Park and in Barnsley.
The loans bridged a gap where bank lending or investor finance fell short - a requirement for almost all construction projects outside London.
Launched three years ago, most of the loans have been repaid and a second round is planned with extra money from the City Region.
JESSICA was set up by Creative Sheffield - the city council’s business department - in 2013 with two thirds of the money from Europe, via the City Region.
The cash is looked after by fund manager CBRE, which has produced a report on its progress.
John Mothersole, chief executive of Sheffield City Council, said: “The Fund has fully invested its first round despite uncertain times and has built a credible and respected position within the local investment market.
“This success has been acknowledged by all our partners and is now resulting in additional Sheffield City Region funds being made available to support and encourage further development in our regional economy.
“Through its recent investment activity, the Fund has become a major investment brand in the regional economy, recognised by the major developers for its market facing approach to funding.”
David Topham, chief executive of CTP which built 3 St Pauls Place, said: “It has ensured the delivery of Grade ‘A’ office in Sheffield city centre - a market where speculative development would not otherwise have been possible.”
JESSICA also helped fund the redevelopment of two historic mills at Kelham Island, called Little Kelham.
Fraser Stride, CITU finance director, said: “The SCR JESSICA funding has been a key part in delivering a scheme at Kelham Island that wouldn’t have been possible using traditional funding sources.”
William Church, CBRE director, said: “Our expectation is that over the first 10 years assets totalling £250m will be enabled using SCR JESSICA and associated funding, through recycling of capital. This will aim to draw in and leverage more than £100m of private-sector capital, much of which would not be invested in the region without the Fund’s flexible approach.”