It is by no means a new conversation that town and city centres across Scotland require significant regeneration to return them to the vibrant epicentres of our communities they once were.
Over the last decade our towns and city centres have had faced challenges, exacerbated by cultural, social and technological changes, most notably the Covid pandemic and a significant shift towards online retail.
Local authorities across Scotland and both the Scottish and UK Governments recognise the issues at play, with the Programme for Government announcement made by the First Minister John Swinney on 4 September underlining the measures that will grow Scotland’s economy.
This includes the delivery of affordable housing, better infrastructure and attracting more foreign investment.
Support has been made too by the UK Government, which awarded six projects in Scotland a collective £122m from the third round of its Levelling-Up Fund that is designed to breathe life back into our towns and city centres.
While wholly positive, to make long-term and meaningful change there needs to be an honest assessment of how deteriorated our city centres have become.
Let’s take Glasgow, for example. This dear green place has been scrutinised for the lacklustre city centre and empty units that now line once prominent retail destinations. It is a sorry sight, but there is opportunity for renewal.
That opportunity starts with change, and crucially, better collaboration between private and public sector organisations.
In my opinion, it is a two-way street; the city centre needs private development and funding to achieve the ambitious, ‘sustainable-first’ blueprint it has in mind, and developers must recognise the investment potential of Glasgow city centre.
Equally, the perception that private developers and funders are the bad guys, needs to stop. There must be a meeting of minds if we are serious about change.
We all know that key to the stimulation of town and city centres is people living there. New figures released by Glasgow City Council in August highlight that the number of people living in Glasgow city centre has risen by a third in just over a decade, with 28,341 now calling it home.
This is good news, but for this to grow exponentially as is required, a mixed tenure of housing and best-in-class social amenities is essential. We can’t expect people to re-locate to the city centre if the right housing or amenities are not readily available.
The recently proposed Housing (Scotland) Bill and the associated rent controls has put the brakes on the investment appetite from build-to-rent (BTR) developers.
This unintentional consequence is, of course, concerning, but BTR is not the only housing tenure that will solve the city centre demand.
We need a considered mix of affordable and private housing that critically addresses the demand and is reflective of the long-term objectives of the city council.
There are great examples of how city centre regeneration and improved housing opportunities have been achieved internationally that we can draw inspiration from.
CBRE is active across various cities in the US and our team sees first-hand the positive impact that development, stimulated through tax incentives, has on economic growth.
A prime example is Low-Income Housing Tax Credits (LIHTC). LIHTC is a federal programme in the US that has contributed to the development of nearly three million affordable rental units over the past 30 years.
Under the LIHTC structure, investors receive a dollar-for-dollar reduction in federal tax liability over a 10-year period in exchange for providing affordable housing.
This is a fantastic example of public (tax policy implementation) and private (real estate development delivery) collaboration that has economic and social benefit.
Today, LIHTC stands as the largest single contributor to the US’s affordable housing stock – an achievement that is truly remarkable.
In the end, collaboration is the key to successful regeneration. We all share a common vision of breathing new life into our towns and city centres, transforming them back into the bustling business and social hubs they once were.
With a united effort from both public and private sectors, I am confident that we can make this vision a reality.