Manchester sold itself to Abu Dhabi’s elite - Guardian article

[west didsblue]

Those are the same properties & deals, the table you're referring to simply showed which Jersey based company the land was transferred to.

Yes I realise that, but as I said the comparison did not show the land area.
The location would also be important. A per unit comparison without the full picture is a bit meaningless.

 

[mexico1970]

The guardian and its readers can fuck off.

 

[M18CTID]

Very odd. Has East Manchester considerably changed for the better due to this deal? Yes. Is the sheik making money off the deal? Probably, like any land developer (we live in a capitalist world). Was the land undersold or was the deal clouded in controversy? No, doesn't seem to be the case.

I'm surprised the article was given the green-light by the editor. It's pointless.

Maybe the author would be more positive about it if it was Gary Neville who had bought the land.

The only real issue I have with any of it is that when it first came about, I think there was talk of affordable housing but the prices of these properties are out of reach for many people. However, that's just typical of the housing market in general over the past few years. When houses are now changing hands for north of £200,000 in Gorton of all places, then I think it's fair to say that affordable housing is little more than a pipedream in even the poorest areas these days.

 

[KS55]

If you're really interested -

View attachment 50442


Data gleaned from viability assessments suggests that the prices of land leased by Manchester City Council to Manchester Life are lower than for comparable sites purchased by other developers. When accounting for the price paid per unit, the value of land at Eliza Yard, a 118 Build to Sell development brought forward in 2021, was estimated at £5,600 by the consultancy Savills. This compares to an estimated price paid per unit of roughly £15,000 for the Victoria Riverside site bought by the Hong Kong developers Far East Consortium, and £17,000 for the Fierra Capital development on Long Acre Street, both considered comparator developments by Savills.


In response to our queries, Manchester City Council said that all leases achieved best consideration, were underwritten by a red book valuation at the time and involved the payment of a premium. Variations in the range of prices per unit paid may partially reflect additional costs due to differences in site conditions and may also reflect decisions to sell at different moments in the property market cycle, with land values likely to be lower in the post-recessionary period of 2014 and 2015. It is nonetheless notable that the price per unit paid to developers can be much higher for neighbouring developments even in years like 2016, such as the £38,251 paid for the NCP car park site on Tib Street in Manchester’s Northern Quarter – two years before the leaseholds were sold for the One Vesta Street development, where the price paid per unit was considerably lower (figure 5).

The council claims that they have ‘overage’ arrangements in place which may provide them with additional income. However, they were unwilling to disclose the details of those overage arrangements on commercial grounds: e.g. how much are they entitled to, what events trigger the overage payment (does the leasehold need to be sold, for example?) and above what threshold do overage payments kick in? The council also did not provide us with a figure for how much they had received via overage payments in the project overall (i.e. via land, buildings, rental income etc), and we can find no details of these arrangements or record of any overage payments received by the council in their accounts or the public domain generally.

It is important to be sensitive to the conditions of each plot. A lower estimated price per unit paid may also reflect requirements for lower carbon development at, for example, Eliza Yard as a land plot owned by Manchester City Council. However, overall our estimates of the prices paid per unit for other Manchester Life projects suggest that Manchester Life have been able to access land at a cheaper rate than many comparable developments. We estimate that if the leasehold transfers had used a calculation of £17,700 per unit, equivalent to that of Ancoats Gardens, the Council could have leased land to Manchester Life for a total of £17,292,900. This would have generated an additional £12,341,620 in income to the public purse, rather than the £4,951,280 that was actually received.

It should be noted that the market price paid to the council for these leaseholds is also much lower than land bought by the council in the vicinity at market value. For instance, the council bought the nearby Ancoats Retail Park in 2017 at over £3.2m per acre, over four times higher than the average price of the leaseholds paid by Manchester Life entities. The Council may be selling the leasehold at the bottom of the market, while buying land back once a property boom is underway. If that is the case, there are questions to be answered about the council’s stewardship of its land assets and whether they are effectively protecting the option value of their own land assets.

In response to our queries on these features of the development, the council has stated that ‘from the outset Manchester Life was set up to restart the market and be a platform for multiple investors to deliver a significant number of homes on the eastern edge of the city in 2012/15 as a consequence of the earlier financial crisis of 2014/15. The partnership was established with robust financial and structural arrangements to protect the Council’s interests’61. This periodisation is contestable in our view – we would argue that the financial crisis took place in 2007/8 and that by 2014/15 some confidence had returned to real estate markets after significant government and central bank interventions. And whilst the council stresses that their governance arrangements have protected value for money, without evidence of value returned to the council we have no means of assessing that claim. In our view, the comparably low rates paid for the leaseholds for land in the absence of competition raise value for money questions.

Who has written this piece?

 

[KS55]

I think that only a full assessment of AbuDhabi’s relationship with Manchester Council and the many other development projects, eg Fallowfield University campus, can produce a meaningful conclusion. There will be quid pro quos across the deals. Don’t expect the Grauniad to do that.
I don’t think this is really an attack on City, but the refs to the club are just there to get popular interest.
Serious economic commentators treat Chakraborti as a joke.

 

[domalino]

Who has written this piece?

The link to the Sheffield University study is in the Guardian article, all the required information is in pdf of the study.

 

[youngbob]

Think it's a good article tbh.

 

[mac]

Very odd. Has East Manchester considerably changed for the better due to this deal? Yes. Is the sheik making money off the deal? Probably, like any land developer (we live in a capitalist world). Was the land undersold or was the deal clouded in controversy? No, doesn't seem to be the case.

I'm surprised the article was given the green-light by the editor. It's pointless.

Also is the season upon on us and are the red wankers worried?

 

[The Pandorica Opened]

Not sure why everyone is so rattled by this. We don't support the Abu Dhabi United Group, after all.

It's a complicated conversation about allowing interests like these to buy out the areas they do, with fairly obvious positives and negatives. Nothing wrong with an article about it, written with obvious research behind the points, and the best response to it isn't bland old buzzwords like "agenda", "Grauniad", or whatever, which only serves to bring the same old "Al-Manchester", "Oil Clasico" stuff in return - but reading the information from all sources and coming to your conclusions based on that; not just that the same investment group has made your favourite football club rich.

I think the problem is that the housing market has been fucked harder than Mia Malkova by the economics we've had since the 70's, which makes it hard to assess the success of any one particular project with that context. Personally, I don't think the investments are any great ground for criticism, although I do understand the doubts. I will say that criticising the investment on the grounds of the (atrocious) humans-rights record of the UAE is a weak point; it simply isn't relevant, unless you think Mansour intends to convert east-Manchester into an enclave of the UAE with it's own para-military force. His dealings with City are also completely besides the point. However, the murkiness of the purchase and it's surveying are more salient. All in all, I can only say that it's borderline-impossible to assess a single project without the obvious context of the housing market in 2022. Solutions should come a well-funded and common-sense government prepared to house it's own citizens. This isn't ideal, but nothing about housing/land is, right now.

 

[manimanc]

Chaka can't.