With the economic outlook improving, the UK’s regional towns and cities look poised for a period of sustained growth in 2014, with Cambridge leading the way, according to research by national commercial property consultancy, Lambert Smith Hampton (LSH).
To identify those towns and cities best placed to drive the regional recovery, Lambert Smith Hampton’s ‘UK Vitality Index’ has ranked 65 of the largest towns and cities outside London, to provide a thorough view of the health of the local economies, and identify which are best placed to support future economic growth.
The top 10 towns and cities in the UK Vitality Index are:
Cambridge
Guildford
Brighton
St Albans
Reading
Wokingham
Maidenhead
Warwick
Milton Keynes
Bournemouth, Edinburgh, Reigate (joint place)
Tom Leahy, Associate Director of Research at LSH, said: “We set out to create an annual guide that will track the vitality and performance of the major UK towns and cities, across a range of socio-economic measures. It can be used as a resource for occupiers and investors when choosing where to locate or invest.
“The results of the UK Vitality Index are a reminder that amid some of the well-publicised problems faced in the regions, such as the structural decline of high streets, many local economies are thriving. Considering 78% of UK GDP is generated outside London, the successes of the regions can be overshadowed by the capital.
“For the UK economy to make up the ground lost over years since the recession it is vital that growth spreads out from London and into the regions. The towns and cities at the top of the index have healthy and robust local economies, are well placed to support growth and will provide opportunities for businesses to expand.
“Cambridge is the top ranking city in our index. It has a vibrant business start-up scene and a well-educated workforce making it ideally-placed to support future economic growth. Driven by its expertise in bioscience and information technology, Cambridge has a dynamic local economy that outperforms on almost all of the 20 different measures used to assess the health of the UK’s main regional economies.”
Although the list of the top ten towns and cities is dominated by the South East of England, the top ten also features Warwick, Edinburgh and the south coast resorts of Brighton and Bournemouth.
After three successive quarters of GDP growth, the improvements in the regional economies are starting to feed through to the property market. The residential property market outside London has seen a real turn-around in fortunes in 2013: the latest Q3 2013 data shows that house prices in all parts of the UK grew in comparison with Q3 2012. Regional commercial property investment volumes in the first nine months of 2013 have already eclipsed the whole of 2012.
Tom added: “In commercial property, almost without exception, the major regional office markets have seen growth in take-up in 2013 in comparison with 2012. While in many cities, average office rents for regional commercial property have already returned to growth in 2013.
“We expect the top 10 towns and cities highlighted in our report to outperform in 2014 as their strong economies feed through to the property markets – both commercial and residential.”