FUTURE DEMAND - SHORT TERM/LONG TERM - Short Term Demand - Milton ...
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Milton Keynes Partnership GVA Grimley LLP
5. FUTURE DEMAND – SHORT TERM/LONG
TERM
Short Term Demand
5.1 In the short term existing property market information provides a reasonable basis upon
which to assess demand. However we would urge caution against reading too much into
past trends in terms of spatial distribution. There has been limited availability of
development opportunities in CMK over the last 5 years or so and burgeoning office
development has therefore been met out of town. Whilst there is some differentiation
between out of town and in town office markets there is also extensive overlap. It would be
wrong to assume that the extent of out of town office take up in the past points necessarily
towards the trend continuing in the future.
5.2 Our conclusions, based on a level of growth the same as that outlined by the monitoring
reference value in the MKSM Strategy of 44,900 additional jobs by 2031, are:
• Continuing demand for offices floorspace. Development trend data would suggest an
average take-up of land of 23,000 sqm/year – 6.3 ha/year depending on the densities
assumed. This will consist of demand from established business of all sizes. This
demand will contain elements wanting to purchase freeholds given the still attractive
proposition to place property assets in pension funds for this sector. Buildings from
290 sq m to 900 sq m are likely to be in the greatest demand from this source;
• External demand for offices seems likely to focus on back office functions rather than
corporate headquarters. Some of this will focus on CMK but a lack of readily available
Grade A supply may well frustrate this and lead to further pressure on more peripheral
sites. Encouraging a pipeline of supply in CMK is therefore crucial if further peripheral
development is to be avoided;
• We would anticipate continuing modest demand from industrial occupiers. Most of this
will originate locally and be driven by restructuring or the opportunity to capture value
up lift on existing sites; and
• Distribution demand will continue to expand driven by relative land availability and
price close to motorway junctions, or where large plots are available for development.
Requirements would be large a minimum of over 9,000 sq m (100,000 sq ft) up to
70,000 sq m (750,000 sq ft) although we expect most requirements to be less than
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45,000 sq m (500,000 sq ft). Milton Keynes’ growing population and availability of land
will continue to attract demand from this sector. Overall to meet industrial/distribution
16 net ha per annum (17.5 – 19 ha gross) will be required.
Demand to 2021/2031 – Future Economic Scenarios
Economic Projections and Scenarios
5.3 The following section sets out the methodology for the preparation of the land demand
forecasting component of the study. This includes the use of employment forecasts and
the development of alternative forecasting scenarios, their translation into employment
floorspace forecasts and subsequently into estimates of future land requirements. The
approach requires the development of a series of alternative economic scenarios to 2031
which form a starting point for the demand forecast.
Selected Scenarios
5.4 At present there are no employment forecasts for Milton Keynes for the relevant period that
are sufficiently disaggregated to use as a basis for employment land forecasting. The only
agreed quantified estimates of future employment in Milton Keynes are the jobs targets set
in the MKSM Sub-Regional Strategy (see Chapter 2 above) of 44,900 additional jobs
expected within Milton Keynes to 2021. It was decided, in consultation with the client
group, that base-case employment projections for this study would be based on this MKSM
monitoring reference value and an alternative economic scenario would be formulated to
take account of the client group’s own local economic development aspirations, policies
and strategies.
5.5 In addition to the economic policy and research documents and initiatives reviewed in
Chapter 2 above, the client group provided guidance regarding the potential direction of
alternative scenarios, taking account of local economic strategies, policy-led economic
targets, “aspirational” benchmarks for economic growth and consideration of the
distribution of employment growth between sectors. On the basis of this information, it was
decided to adopt an MKSM base-case Scenario 1 and an alternative policy-on Scenario
2 for the employment land forecasts.
5.6 With regard to future employment and employment land needs, the study brief also
proposed examining the link between the development of housing and the way in which
this might directly increase the need for local service employment in, for example,
education, health services, retailing, personal services, etc. These sectors of employment
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are often referred to as “non-basic” sectors (the “basic” sectors being those such as most
of the manufacturing sectors, primary industries and other footloose service sectors which
are not dependent on local demand). Economic Base Analysis has been used to define
and measure the size of these sectors and this study has examined the relationship
between these and the growth of housing using the MKSM Sub-Regional Strategy housing
monitoring reference values to 2021 and 2031. As this is only a partial analysis of the
impact on the non-basic local service sectors, this is not treated as a full alternative
scenario but the analysis and results are presented as an economic base projection with
the analysis of scenarios below.
Scenario 1: MKSM Base-case Scenario
5.7 The base-case scenario is a projection of employment growth to 2031 based on the stated
MKSM Strategy jobs monitoring reference value for Milton Keynes - i.e. an additional
44,900 jobs from 2001 to 2021 and then rolling this same level of growth forward to 2031.
It should be noted that MKSM job reference values have been determined assuming 1 job
per new house from 2001 to 2021. The projection here uses actual employment levels –
based on ABI sample data – for 2001 and 2004 and then projects a linear rate of growth to
the 2021 target and on to 2031.
5.8 Whilst the MKSM Strategy provides an overall reference point for job growth to 2021, it
does not provide any estimate of how the sectoral structure of the economy could be
expected to change during this period. For a base-case scenario the existing 2001 or 2004
sectoral structure could be adopted, but as the studies reviewed in section 2 indicate
Milton Keynes has had a relatively dynamic and changing economic structure. It was
therefore recommended that the projected distribution of the MKSM target jobs between
sectors should be based on the changing sectoral trends from the period 1995 to 2004 –
the longest period over which consistent employment data by sector is available. Thus the
base case scenario projects the structural changes based on the 1995-2004 trend in each
2-digit SIC sector and then controls these sectoral changes proportionately back to the
reference point 44,900 jobs in 2021. A straight line trend was assumed in all sectors from
2004 to 2021 and on to 2031. In some cases it was necessary to make manual
adjustments to the trend data before it was controlled to these targets, since compound
growth rates were not thought to be appropriate for all sectors. In the case of industries
which had grown from a very low base in 1995, the total number of additional jobs over the
10 year period was added for the whole period to 2031. For other selected sectors which
have grown by a very high proportion it is more appropriate to use a fraction of the
compound growth figure. The following adjustments were made in the following 10 sectors:
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Table 5.1 – Sectors in which Adjustments were made
Total jobs change
02 : Forestry, logging and related service activities 95-04 taken to
2031
Total jobs change
23 : Manufacure of coke, refined petroleum products and nuclear
95-04 taken to
fuel
2031
Total jobs change
35 : Manufacture of transport equipment 95-04 taken to
2031
One fifth of 95-04
60 : Land transport; transport via pipelines
trend taken to 2031
Total jobs change
61 : Water transport 95-04 taken to
2031
63 : Supporting and auxiliary transport activities; activities of travel One fifth of 95-04
agencies trend taken to 2031
Total jobs change
67 : Activities auxiliary to financial intermediation 95-04 taken to
2031
One fifth of 95-04
72 : Computer and related activities
trend taken to 2031
Total jobs change
91 : Activities of membership organisations not elsewhere classified 95-04 taken to
2031
Half of 95-04 trend
92 : Recreational, cultural and sporting activities
taken to 2031
Source: GVA Grimley, 2006
Scenario 2: Policy–on Scenario
5.9 The policy-on growth scenario is based on a more aspirational forecast which maintains
job growth levels of around 3,750 jobs per annum, based on recent employment growth
trends continuing into the future. From the base year (2004) this would generate around
65,000 additional jobs in the 17 years to 2021 – again rolled forward at the same rate to
2031. It should be noted that, although this rate of jobs growth is based on recent jobs
growth trends, this scenario is equivalent to more than 1.5 jobs per dwelling in 2021 if
MKSM housing targets are met.
5.10 In this case, the base-case sector growth is assumed to be the same and then the
additional jobs are distributed between sectors based on economic policies and targets
implied in the MK2031 Growth Strategy and MK Local Plan policy. This was calculated
through an estimation of potential changes in employment in 13 “policy-on” sectors
identified qualitatively in the strategy and plan using appropriate regional, national or trend
growth benchmarks for the relevant sectors. The remainder of the target is distributed
amongst the other service sector industries according to their current employment
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structure. The assumptions for the “policy-on” scenario for the 13 relevant sectors were as
follows:
Table 5.2 – Policy-on Assumptions
51 : Wholesale trade and commission Average p.a. growth rate adjusted upwards to
trade, except of motor vehicles and SEEDA projections for transport and
motorcycles communications
52 : Retail trade, except of motor Average p.a. growth rate adjusted upwards to
vehicles and motorcycles; repair of SEEDA projections for distribution hotels and
personal and household goods catering
Base scenario already above comparator
55 : Hotels and restaurants
projections, so set to half '95-'04 trend
Average p.a. growth rate adjusted upwards to
60 : Land transport; transport via
SEEDA projections for transport and
pipelines
communications
Average p.a. growth rate adjusted downward to
63 : Supporting and auxiliary transport
SEEDA projections for transport and
activities; activities of travel agencies
communications
Average p.a. growth rate adjusted upwards to
65 : Financial intermediation, except
SEEDA projections for financial and business
insurance and pension funding
services
Average p.a. growth rate adjusted upwards to
66 : Insurance and pension funding,
SEEDA projections for financial and business
except compulsory social security
services
Average p.a. growth rate adjusted upwards to
67 : Activities auxiliary to financial
SEEDA projections for financial and business
intermediation
services
Base scenario already above comparator
72 : Computer and related activities
projections, so set to half '95-'04 trend
Average p.a. growth rate adjusted upwards to
73 : Research and development SEEDA projections for financial and business
services
Average p.a. growth rate already above SEEDA
74 : Other business activities projections so adjusted upwards to UK projections
for financial and business services
Average p.a. growth rate adjusted upwards to UK
80 : Education
projections for Health and Education
92 : Recreational, cultural and sporting Base scenario already above comparator
activities projections, so set to half '95-'04 trend
Source: GVA Grimley, 2006
An Economic Base Projection
5.11 As noted above the study is also examining the direct effects of the MKSM housing growth
targets to 2021 and 2031 on the demand for so called “non-basic” local service jobs –
expected to result in the growth of local service employment in, for example, education,
health services, retailing, personal services, etc - with or without any aspirations or policy
targets for jobs growth. This scenario analyses the impact on employment of the MKSM
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Strategy targets for an extra 44,900 dwellings being constructed by 2021 and a further
23,700 new homes within Milton Keynes, making a total of 68,600 new homes, to 2031.
5.12 In order to test the relationship between the growth of new dwellings and local service
employment a cross sectional regression analysis was carried out using 2001 census and
ABI data from every local authority in England. The analysis tested the relationship
between number of dwellings and two groups of local services defined by using 2-digit SIC
data:
• Taking nine local service sectors where nearly all employment can normally be
classified as non-basic, the analysis shows that the relationship is significant and
remarkably consistent across the sample of towns and cities such that an increase of
one dwelling is associated with an increase of 0.31 jobs in these sectors, irrespective
of the size of the town. These sectors are:
• Other service activities;
• Private households as employers of domestic staff;
• Undifferentiated goods producing activities of private households for own use;
• Undifferentiated services producing activities of private households for own use;
• Health and social work;
• Sewage and refuse disposal, sanitation and similar activities;
• Renting of machinery and equipment, personal and household goods;
• Retail trade and repair of personal and household goods;
• Sale, maintenance and repair of motor vehicles and motorcycles; and
• retail sale of fuel.
5.13 A further seven local service sectors were identified where most employment can normally
be classified as non-basic depending on the size and local / regional / national role of the
town or city. When these are incorporated into the non-basic sector the analysis again
shows that the relationship between number of dwellings and these local service jobs is
still statistically significant and does indeed vary as towns increase in size. Furthermore, a
distinct structural break in the relationship between the size of towns and employment in
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this larger group of local service sectors was found to be statistically significant with the
break around the 200,000 population mark (approximately the size of Milton Keynes now).
This analysis suggests that, if Milton Keynes rises above this population level in future and
as the city’s regional role grows, an increase of one dwelling would be associated with a
further increase of 0.37 jobs in these seven larger local sectors, i.e.:
• Construction;
• Hotels and restaurants;
• Real estate activities;
• Public administration, defence and social security;
• Education;
• Activities of membership organisations; and
• Recreational, cultural and sporting activities.
5.14 These ratios were therefore used to examine the impact on employment in these sectors of
the projected increase in dwellings in Milton Keynes to 2021 and 2031.
Results of the Scenario Projections
5.15 Summaries of the employment forecasts in 2021 and 2031 for Milton Keynes under each
scenario, together with estimates of the impact of the “Economic Base Projection” are
given in Table 5.3 below.
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Table 5.3 - Summary of Employment Projections based on Economic Scenarios
Scenario 1 Scenario 2
Base Case Policy-on Economic Base Projections
2004 (actual) 2021 2031 2021 2031 2021 2031
01 : Agriculture, hunting and related service activities 82 84 86 84 86 82 82
02 : Forestry, logging and related service activities 48 68 79 68 79 48 48
05 : Fishing, operation of fish hatcheries and fish farms; service activities incidental to fishing - - - - - - -
10 : Mining of coal and lignite; extraction of peat - - - - - - -
11 : Extraction of crude petroleum and natural gas; service activities incidental to oil and gas extraction
4 excluding2surveying 0 2 0 4 4
12 : Mining of uranium and thorium ores - - - - - - -
13 : Mining of metal ores - - - - - - -
14 : Other mining and quarry 25 14 7 14 7 25 25
15 : Manufacturing of food and beverages 1,969 1,081 559 1,081 559 1,969 1,969
16 : Manufacture of tobacco products - - - - - - -
17 : Manufacture of textiles 32 14 3 14 3 32 32
18 : Manufacture of wearing apparel; dressing and dyeing of fur 18 7 1 7 1 18 18
19 : Tanning and dressing of leather; manufacture of luggage, handbags, saddlery, harness and42footwear 17 3 17 3 42 42
20 : Manufacture of wood and products of wood and cork, except furniture; manufacture of articles 193 of straw and219plaiting materials
234 219 234 193 193
21 : Manufacture of pulp, paper and paper products 581 777 892 777 892 581 581
22 : Publishing, printing and reproduction of recorded media 934 453 171 453 171 934 934
23 : Manucature of coke, refined petroleum products and nuclear fuel 189 241 272 241 272 189 189
24 : Manufacture of chemicals and chemical products 415 177 38 177 38 415 415
25 : Manufacture of rubber and plastic products 939 423 120 423 120 939 939
26 : Manufacture of other non-metallic mineral products 118 115 114 115 114 118 118
27 : Manufacture basic metals 198 96 36 96 36 198 198
28 : Manufacture of fabricated metal products, except machinery and equipment 1,494 890 534 890 534 1,494 1,494
29 : Manufacture of machinery and equipment not elsewhere classified 1,579 1,078 783 1,078 783 1,579 1,579
30 : Manufacture of office machinery and computers 144 100 74 100 74 144 144
31 : Manufacture of electrical machinery and apparatus not elsewhere classified 652 301 95 301 95 652 652
32 : Manufacture of radio, television and communication equipment and apparatus 996 892 831 892 831 996 996
33 : Manufacture of medical, precision and optical instruments, watches and clocks 458 197 43 197 43 458 458
34 : Manufacture of motor vehicles, trailers and semi-trailers 942 599 398 599 398 942 942
35 : Manufacture of transport equipment 345 424 470 424 470 345 345
36 : Manufacture of furniture; manufacturing not elsewhere classified 421 204 76 204 76 421 421
37 : Recycling 44 23 10 25 14 44 44
40 : Electricity, gas, steam and hot water supply 100 44 10 46 15 100 100
41 : Collection, purification and distribution of water 55 23 4 24 5 55 55
45 : Construction 3,433 5,907 7,362 7,741 10,274 5,456 6,531
50 : Sale, maintenance and repair of motor vehicles and motorcycles; retail sale of automotive 4,715
fuel 3,883 3,394 4,729 4,737 6,560 7,581
51 : Wholesale trade and commission trade, except of motor vehicles and motorcycles 9,503 10,108 10,464 11,280 12,325 9,503 9,503
52 : Retail trade, except of motor vehicles and motorcycles; repair of personal and household 18,897
goods 21,207 22,565 21,788 23,489 25,477 29,446
55 : Hotels and restaurants 6,182 8,061 9,166 9,085 10,793 9,165 10,970
60 : Land transport; transport via pipelines 3,572 4,315 4,753 4,240 4,633 3,572 3,572
61 : Water transport 20 27 32 35 44 20 20
62 : Air transport - - - - - - -
63 : Supporting and auxiliary transport activities; activities of travel agencies 4,868 8,172 10,115 5,778 6,314 4,868 4,868
64 : Post and telecommunications 3,152 1,469 479 1,588 668 3,152 3,152
65 : Financial intermediation, except insurance and pension funding 5,330 3,465 2,368 7,142 8,208 5,330 5,330
66 : Insurance and pension funding, except compulsory social security 239 99 17 320 368 239 239
67 : Activities auxiliary to financial intermediation 877 1,017 1,099 1,175 1,351 877 877
70 : Real estate activities 2,081 6,030 8,352 8,110 11,657 2,900 3,471
71 : Renting of machinery and equipment without operator and of personal and household goods 778 2,872 4,104 3,895 5,728 998 1,153
72 : Computer and related activites 6,294 13,735 18,111 13,735 18,111 6,294 6,294
73 : Research and development 89 49 25 104 113 89 89
74 : Other business activities 20,748 30,371 36,032 30,624 36,433 20,748 20,748
75 : Public administration and defence; compulsory social security 5,056 5,632 5,971 7,120 8,334 7,142 8,550
80 : Education 8,811 7,255 6,340 12,046 13,949 13,464 16,116
85 : Health and social work 8,939 20,279 26,949 26,992 37,611 11,570 13,372
90 : Sewage and refuse disposal, sanitation and similar activities 527 592 630 748 879 670 775
91 : Activities of membership organisations not elsewhere classified 1,452 1,722 1,881 2,191 2,626 1,881 2,251
92 : Recreational, cultural and sporting activities 3,369 5,256 6,365 6,254 7,951 4,498 5,384
93 : Other service activities 1,484 1,514 1,531 1,895 2,137 1,897 2,192
95 : Private households as employers of domestic staff - - - - - - -
96 : Undifferentiated goods producing activities of private households for own use - - - - - - -
97 : Undifferentiated services producing activities of private households for own use - - - - - - -
99 : Extra-territorial organisation and bodies - - - - - - -
Total 133,433 171,598 194,048 197,183 234,683 159,385 175,501
Source: GVA Grimley, 2006
5.16 Table 5.3 provides an overall comparison of the two alternative scenarios and the effect on
non-basic local service sectors (only) of the economic base projection. The base-case
scenario generally shows modest rises in employment from 2004 of just over 38,000 to a
total of 171,500 by 2021 and to 194,000 by 2031. The increase of 38,000 from 2004 to
2021 is nearly 7,000 less than the baseline jobs reference value from 2001 to 2021 of
44,900 jobs – implying that nearly 7,000 jobs of the 44,900 MKSM reference value had
been achieved during the period 2001 to 2004. The Policy-on scenario (scenario 2)
projects a higher level employment growth of around 64,000 jobs to 197,000 jobs by 2021
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– higher than the 2031 level for Scenario 1. By 2031 Scenario 2 jobs are projected to grow
to nearly 235,000 – growth of over 100,000 jobs.
5.17 Sectorally, employment in the Milton Keynes economy is expected to decline in virtually all
manufacturing sectors at more or less the same level in both Scenarios 1 and 2. This is
because the policy–on scenario does not target manufacturing sectors significantly and
existing declining trends are expected to continue. Service sector employment in sectors
such as construction, transport, retailing, computing services, professional services, other
business services is expected to grow significantly in both scenarios – and at generally
higher levels in Scenario 2. Sectors such as finance and education show additional
significant growth under scenario 2 however.
5.18 The Economic Base projection, as noted above, focuses only on the non-basic local
service sectors identified (no change is shown at all in the other service and manufacturing
sectors) but shows that, if the effect of simply increasing the number of dwellings is as
analysed, then total employment in these local service sectors can be expected to rise
“automatically” by 26,000 jobs by 2021 (+44,900 dwellings) and 42,000 jobs by 2031(+
68,600 dwellings). It is stressed that this is a partial (local service only) view of jobs growth
- and to some extent overlaps with, and is included in, Scenario 1 and 2 - and it is not
recommended that this economic base projection should be treated as a scenario for
employment land requirement purposes.
5.19 As noted above the study is also examining the direct effects of the MKSM housing growth
targets to 2021 and 2031 on the demand for so called “non-basic” local service jobs –
expected to result in the growth of local service employment in, for example, education,
health services, retailing, personal services, etc - with or without any aspirations or policy
targets for jobs growth. This scenario analyses the impact on employment of the MKSM
Strategy targets for an extra 44,900 dwellings being constructed by 2021 and a further
23,700 new homes within Milton Keynes, making a total of 68,600 new homes, to 2031.
Long Term Property Requirements
5.20 One of the principal tasks of the employment land study has been to provide long term
forecasts of floorspace requirements by linking the property and economic analysis. The
study notes that this has been subject to some discussion on achieving an appropriately
detailed level of spatial and sectoral analysis to meet the requirements of the recent ODPM
Guidance (Employment Land Reviews – Guidance Note ODPM 2004). An analysis was
carried out to determine the most appropriate sectoral groupings for the Milton Keynes
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economy, which is sufficiently robust as a basis for the economic forecasting of future
floorspace needs and their use in the spatial modelling of employment land scenarios.
5.21 As noted above the employment land forecasts have been based on the employment
projections scenarios developed in the previous section. With regard to translating
employment forecasts into floorspace and land use classes/property types, we have noted
that the ODPM Guidance acknowledges that this is also "difficult and to some extent a
matter of professional judgement." This is best achieved by grouping SIC data into say 20-
30 sectoral groupings appropriate for the study area and the employment property product
types available. This section sets out the methodology underpinning the preparation of the
land demand forecasting component of the study providing a clear audit trail of the
methods, assumptions and stages of work of the study.
5.22 Based on the principles above the methodology for the employment land forecasts is set
out in five steps:
• Employment forecasts;
• Employment and land categorisation;
• Apply employment densities;
• Prepare floorspace requirement forecasts;
• Convert floorspace to land estimates and forecast land requirements.
Step 1: Employment Forecasts
5.23 The scenario based employment projections used in this study utilise ABI employment
data which aggregates 2-digit SIC activity groupings into 62 industrial sectors, as shown in
Table 5.3 above. The projections include historical data from 1995 to 2004 and projections
from 2005 to 2031 for Milton Keynes.
Step 2: Employment and Land Categorisation
5.24 The next step was to identify appropriate sector groupings for Milton Keynes, which reflect
the structure and spatial distribution of employment and also reflect different land use
types. This requires the selection and aggregation of the 62 ABI sectors to develop a
shortlist of between 20 and 30 sector groupings, based on an analysis of sector size,
growth, and local concentrations / competitive advantages.
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5.25 Some 26 groups - 10 manufacturing groups and 16 service groups - were adopted for
forecasting purposes. The groupings are set out below in Table 5.4, together with the
corresponding ABI 2-digit SIC categories for each. It should be noted that not all CE
sectors and 2-digit categories are included – primary agricultural and extractive industries
are for example excluded since they do not directly give rise to demand for employment
land. In addition, in the following SIC categories, only the following percentages of
employment were assumed to give rise to demand for employment land:
• Construction: 15% of employment assumed to be located in fixed employment
premises;
• Education: 10% of employment assumed to be in non-educational - mainly office
premises; and
• Health and social work: 15% assumed to be in headquarters, back-office and other
office premises
Table 5.4: Selected Sector Groups and Corresponding SIC Sectors
Sector Groupings SIC 2003
M1 Manufacturing of food and beverages 15
M2 Manufacture of textiles, wood products and 17, 18, 19, 20,
furniture 36
M3 Manufacture of pulp, paper and paper 21
products
M4 Publishing, printing and reproduction of 22
recorded media
M5 Manufacture of coke, chemicals, minerals, 23, 24, 26, 27,
basic metals and recycling 37
M6 Manufacture of rubber and plastic products 25
M7 Manufacture of machinery and metal 28, 29
products
M8 Manufacture of electronic goods 30, 31,32
M9 Manufacture of medical, precision and 33
optical instruments, watches and clocks
M10 Manufacture of transport equipment 34, 35
S1 Construction 45
S2 Sale, maintenance and repair of motor 50
vehicles and motorcycles; retail sale of
automotive fuel
S3 Wholesale trade and commission trade, 51
except of motor vehicles and motorcycles
S4 Retail trade, except of motor vehicles and 52
motorcycles; repair of personal and
household goods
S5 Hotels and restaurants 55
S6 Land transport and auxiliary activities 60,63
S7 Post and telecommunications 64
S8 Financial intermediation and insurance 65. 66. 67
S9 Other business activities and real estate 70, 71, 74
S10 Computer and related activites 72
S11 Research and development 73
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Sector Groupings SIC 2003
S12 Public administration and defence; 75
compulsory social security
S13 Education 80
S14 Health and social work 85
S15 Other service activities and organisation 91, 93
membership
S16 Recreational, cultural and sporting activities 92
Source: GVA Grimley, 2006
5.26 Table 5.5 below gives the total and sector breakdown of employment for these 26 sector
groups under each scenario and for the economic base projection (referred to in the Table
as Scenario 3). It should be noted that the total employment in 2004 is reduced from
133,433 (see Table 5.1) to 110,922 – and similarly for each scenario total - as a result of
excluding non-relevant sectors for employment land purposes.
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Table 5.5 Employment in Selected Sector Groups
Scenario 1 Scenario 2 Economic Base
Base Case Policy-on Projections
2004 2031 Change 2031 Change 2031 Change
M1 1,969 559 -1,410 559 -1,410 1,969 0
M2 706 317 -389 317 -389 706 0
M3 581 892 311 892 311 581 0
M4 934 171 -763 171 -763 934 0
M5 964 469 -495 473 -491 964 0
M6 939 120 -819 120 -819 939 0
M7 3,073 1,317 -1,756 1,317 -1,756 3,073 0
M8 1,792 1,000 -792 1,000 -792 1,792 0
M9 458 43 -415 43 -415 458 0
M10 1,287 868 -419 868 -419 1,287 0
S1 1,133 2,429 1,296 3,391 2,258 2,155 1,022
S2 4,715 3,394 -1,321 4,737 22 7,581 2,866
S3 9,503 10,464 961 12,325 2,822 9,503 0
S4 18,897 22,565 3,668 23,489 4,592 29,446 10,549
S5 4,946 7,333 2,387 8,634 3,688 8,776 3,830
S6 8,440 14,868 6,428 10,947 2,507 8,440 0
S7 3,152 479 -2,673 668 -2,484 3,152 0
S8 6,446 3,485 -2,961 9,927 3,481 6,446 0
S9 23,607 48,489 24,882 53,818 30,211 25,372 1,765
S10 6,294 18,111 11,817 18,111 11,817 6,294 0
S11 89 25 -64 113 24 89 0
S12 5,056 5,971 915 8,334 3,278 8,550 3,494
S13 881 634 -247 1,395 514 1,612 731
S14 1,788 5,390 3,602 7,522 5,734 2,674 886
S15 2,936 3,412 476 4,762 1,826 4,443 1,507
S16 337 637 300 795 458 538 201
Total 110,922 153,441 42,519 174,727 63,805 137,775 26,853
Source: GVA Grimley, 2006
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Match Sector Groupings to Land Use Class Categories
5.27 This step goes on to allocate all or divide parts of these employment sector groups
between the standard land use categories. These were allocated on the basis of
professional judgement and experience of the consultants’ team, but have remained
disaggregated as far as possible in order to narrow the range of the judgement to be made
for any individual employment group or land use category. Thus the full breakdown of land
use classes (e.g. A1, A2a,b,c etc, A3, B1a,b,c etc., B2, B8, C1) is used together with the
26 sector groups. Where an employment group is allocated to more than one land use
class the percentage of employment assumed to be in each land use class is identified.
Wherever possible this has been determined using 2, 3 or even 4-digit SIC data (2004 ABI
data) to determine the proportions of employees in each relevant sub-sector, for example
to reflect the split between employment in hotels and employment in restaurants for the
study area.
5.28 Table 5.6 shows how the 26 sectors and the proportion of employment in each sector are
allocated to the land use categories. All further aggregations of employment, floorspace
and employment land use categories are based on this disaggregation.
Step 3: Apply Employment Densities
5.29 In order to convert the employment forecasts to floorspace requirements the other key
variable is the worker density assumptions to be applied in the model. Employment
densities are a key link between employment change and land use. The ODPM Guidance
cites a number of comparative density analyses of which the most detailed are those
prepared by Arup Economics and Planning based on original survey data. We have re-
examined these and compared them with those also cited in the Guidance and other
international data. The variation in the key sectors such as office, warehousing and
industrial are limited and the Arup densities cited are the most disaggregated and therefore
adaptable for use in the disaggregated model form adopted for this study. We therefore
recommend the use of the Arup estimates as the most authoritative and fit for purpose.
These are summarised in Table 5.6 below.
5.30 It should be noted that most of the Arup densities are quoted as gross internal floorspace
per worker and that these have been converted to gross external rates by increasing all
business and industrial classes (B1 and B2) by +3.5%, and increasing all shops, financial
and professional services, hotels and catering premises (A1, A2, A3 and C1) by +10%,
whilst the densities for storage and distribution (B8) have remained unchanged.
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Table 5.6: Worker Densities for Milton Keynes Study Sectors
Land Use Density (sq. m /
Activity Sector Group
Category worker)
General & Specialist Manufacturing B2 34
Manufacturing M1, M2, M3, M4, M5, M6, M7, M8
Precision and Electronic Goods M8, M9 B2 / B1c 34 / 29
Transport equipment M10 B2 34
Logistics & Distribution S3 B8 50
Distribution Transport & Communications S6, S7 B8 50 - 80
Offices Various S1, S12, S13, S14, S15, S16 B1a / A2c 19 - 20
Retail Retail – general S4 C1 / B1a / A2 19
Retail Shops / Computer Services S10 A1 19
Insurance, Banking & Finance S7 A2a 20
Retailing, Computing / Professional A2a/b 19 – 20
Services S7, S8
Miscellaneous Services A2c 20
Hotels and Restaurants S5 C1 / A3 13
Research and development S11 B1b 29
Automotive Motor distribution & fuel S2 B2 34
Source: GVA Grimley, 2006
5.31 The density assumptions used are based on current worker/floor space densities. There
are factors impacting on future employment densities which may move towards lower
overall densities or less reliance upon traditional forms of employment floorspace to meet
economic needs. This study has not made adjustments for such changes because we
believe it is better to use consistent and well understood national estimates for a long term
forecasting whilst recognising that these should be monitored.
Step 4: Prepare Floorspace Requirement Forecasts
5.32 The resulting estimates of floorspace requirements for 2031 are summarised in Table 5.5
below. As might be expected from the employment results there are similar declines in the
requirement for B1b/c and B2 floorspace in both scenarios as a result of the continuing
decline in manufacturing and related activities. There are increasing requirements in all
other use classes particularly in A2 and B1a. In the case of Scenario 2, this requires
significantly more B1a space than Scenario 1 and proportionately high increases in some
of the smaller use classes. There is also a growing demand for B8 space in both scenarios
of 175,000 (Scenario 2) to 275,000 sq.m (Scenario 1) - although in proportion to the
existing stock of over 1.1million sq.m this reflects a lower level of increase than in other
high growth sectors. In the case of B8 the growth in demand in Scenario 1 derives from the
continuing 10 year growth trend in distribution, transport and logistics employment but in
Scenario 2, the “Policy-On” assumption is that further growth in these sectors will be
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encouraged but at a rather lower level than the recent high trend – in line with SEEDA
(lower) growth policies for some B8-type sectors (se Table 5.2).
5.33 Although, as noted above, the Economic Base Projection should not be treated as an
independent scenario, the analysis of the effects of increasing the number of dwellings on
local service jobs suggests that this would, in turn, translate into the need for additional
floorspace particularly in the A1 / A2 and B1a classes of use.
Table 5.7 Floorspace requirements by land use class (sq.m)
2004 2031 2031 2031 Change 2004-2031
Scenario Scenario Economic Scenario Scenario 2 Economic
1 2 Base 1 Policy-on Base
Base Policy-on Projections Base Projections
Case Case
A1 144,804 195,059 201,492 218,292 50,255 56,688 73,489
A2 131,649 157,206 163,640 205,138 25,557 31,991 73,489
A2a 86,448 95,221 186,542 94,801 8,773 100,094 8,353
A2b 59,195 170,337 170,337 59,195 111,142 111,142 -
A2c 64,592 75,074 104,775 97,754 10,482 40,183 33,162
A3 35,361 52,432 61,734 62,751 17,071 26,373 27,390
B1a 873,720 1,539,292 1,819,785 1,094,502 665,572 946,065 220,783
B1b 2,671 751 3,393 2,671 -1,920 722 -
B1c 71,740 33,884 33,884 71,740 -37,856 -37,856 -
B2 538,829 287,848 335,244 639,691 -250,981 -203,585 100,862
B8 1,161,910 1,433,088 1,336,008 1,161,910 271,178 174,098 -
C1 35,361 52,432 61,734 62,751 17,071 26,373 27,390
Total 3,206,280 4,092,624 4,478,567 3,771,196 886,344 1,272,287 564,916
Source: GVA Grimley, 2006
Step 5 - Churn Property
5.34 The existing baseline floorspace was calculated using Commercial and Industrial
Floorspace and Rateable Value Statistics 2004, obtained from the Office of the Deputy
Prime Minister (ODPM). This information gave the amount of floorspace in each district
“bulk class”, the main classification of commercial and industrial property. For the data
used in this study, bulk classes are split into four discreet categories, these being:
• Retail premises;
• Offices;
• Factories; and
• Warehouses.
5.35 The Retail and Offices categories can then be sub-divided further to give more detailed
floorspace figures, due to the varied nature of the land use types in these categories. Table
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5.8 below shows the baseline position in terms of the amount of floorspace in each bulk
class by district.
Table 5.8 – Baseline Amount of Floorspace
2
Bulk Class Existing Floorspace (m ) (2004)
Retail Premises 465,000
Commercial Offices 627,000
"Other" Offices 48,000
Factories 991,000
Warehouses 1,531,000
Other Bulk Premises 90,000
Source: ODPM, 2004
5.36 It can be seen above that the dominant bulk classes are Factories and Warehouses, which
together account for over two thirds of all floorspace in Milton Keynes.
5.37 Non-employment growth led property demand, otherwise known as Churn, takes account
of existing businesses that may require new premises due to expansion of their operations
or their desire simply to relocate, in order to acquire newer premises or for strategic
reasons as part of their business operation.
5.38 Churn can have a significant effect on the amount of employment land and floorspace that
is required in order to meet the predicted demand. We have used knowledge from previous
studies to agree a level of churn for different land uses within the study area, which are
detailed below.
Table 5.9 – Churn Factors by Land Use Class
Bulk Class Churn Factor
Commercial Offices 0.50%
"Other" Offices 0.50%
Factories 0.50%
Warehouses 0.50%
Source: GVA Grimley, 2006
5.39 On the basis of these assumptions over a 25 year period 12.5% of employment stock
would be replaced without any employment impact.
Step 6 - Leakage
5.40 We have also considered the effect of leakage from employment areas to other
employment locations such as town centres and other urban and rural locations that are
not existing employment areas.
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5.41 We have based our analysis upon data from the Milton Keynes Employment survey. Using
post code, sector and employment data we have been able to identify the extent of
employment by broad land use in the following locations:
• Employment Areas;
• CMK; and
• Other locations (smaller centres residential area).
Table 5.10 – Employment by Location
% of Jobs
Central Milton Keynes/Employment Areas 61%
Other Urban/Rural Locations 39%
Milton Keynes Employment Survey, 2004
5.42 Further examination of this data indicates that office uses are the major form of
employment outside Employment Areas and CMK (70% of all employment in these
locations). B8 uses are almost exclusively located within employment areas (90% of all
employment) whilst B2 employment is located mainly within employment areas
approximately 15% is located in other urban/rural areas probably reflecting standalone
units.
5.43 We have therefore assumed a leakage of 35% of office employment to other urban/rural
locations and 10% of employment for manufacturing and distribution. These reflect
prudent assumptions based on the existing evidence. We consider a 10% leakage for
manufacturing and distribution to reflect one off standalone units which may occur outside
employment areas/sites including the expansion of existing facilities.
5.44 The table below represents how the effects of churn the amount of existing floorspace for
the whole of Milton Keynes and its implications for employment land.
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Table 5.11 – Effects of Churn and Leakage within Milton Keynes
Bulk Class Land Use Existing Churn Churn Churn Churn Churn
Designation Floorspace (floorspace (land (land (land (land
(m2/year)) (ha/year)) (ha(( 10 (ha)) 20 (ha)) 25
Year Year Year
Summary Summary Summary
(to 2016) (to 2026) (to 2031)
Retail (A1) 465,000 N/A N/A N/A N/A N/A
Premises
Commercial B1a 627,000 3,135 0.8 7.8 15.7 19.6
Offices
“Other” B1a/B1b 48,000 240 0.1 0.6 1.2 1.5
Offices
Factories B2 991,000 4,955 1.1 11.0 22.0 27.5
Warehouses B8 1,531,000 7,655 1.7 17.0 34.0 42.5
Other Bulk - 90,000 N/A N/A N/A N/A N/A
Premises
TOTAL 3,752,000 15,985 3.6 36.5 72.9 91.1
Source: GVA Grimley, 2006
5.45 Overall, the effects of churn in the study area make an additional requirement of 91
hectares of employment land to 2031. The effects of leakage to town centres and other
locations reduce the overall land requirement across the study area by (CoH to add) ha.
5.46 Calculations of churn work on the premise that all predicted floorspace calculations are
positive, therefore in order to produce a positive result where the economic scenarios
predicted negative demand for floorspace in any of the use classes we have set these
values to zero. For instance if demand for B2 floorspace is negative in terms of calculating
land demand we have assumed this to be zero. Otherwise total demand for B2 land could
well be negative when the evidence suggests that land for this use is still in demand.
5.47 The floorspace requirements therefore, for Scenarios 1 and 2 , are shown below.
Overall Floorspace and Land Requirements
Scenario 1 – MKSM Base Case
5.48 Taking into account both demand generated from additional employment and the effects of
churn and leakage the following floorspace requirements are predicted up to 2031.
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Table 5.12 - Floorspace Requirements Scenario 1
2004 – 2011 2012 – 2016 2017 – 2021 2022 – 2026 2027-31 2004 - 2021 2004 - 2031
B1a/B1b 129,832 122,216 121,373 120,530 119,688 373,420 613,638
B1c/B2 34,685 24,775 24,775 24,775 24,775 84,235 133,785
B8 193,430 178,120 178,120 178,120 178,120 549,671 905,911
357,947 325,111 324,268 323,425 322,583 1,007,326 1,653,334
Source: GVA Grimley
5.49 The most significant increase in floorspace requirements is in the distribution (B8) sector at
2 2
549,000 m by 2021 and 906,000 m by 2031 (54.7%) of total floorspace demand. Light
and general manufacturing (B1c/B2) would be expected to grow modestly (largely based
around the relocation of existing businesses). Office and technology space requirements
2
are expected to grow by 613,600 m .
5.50 If all demand is assumed to take place at densities expected on employment sites
(ignoring the potential for much higher densities in CMK and other centres) then the
following employment land requirements are predicted up to 2021 and 2031.
Table 5.13 - Employment Land Requirements Scenario 1
2004 – 2012 – 2017 – 2022 – 2027 – 2004 – 2004 –
2011 2016 2021 2026 2031 2021 2031
B1a/b 35.7 33.6 33.4 33.1 32.9 102.7 168.8
B1c/B2 8.5 6.1 6.1 6.1 6.1 20.6 32.7
B8 47.3 43.5 43.5 43.5 43.5 134.4 221.4
91.5 83.2 83.0 82.7 82.5 257.6 422.9
Source: GVA Grimley
5.51 Therefore, as a maximum 258 hectares of employment land would be required upto 2021;
and 423 ha by 2031. Requirements are dominated by distribution (B8) 134 ha by 2021
and 221 ha by 2031. The overall land requirement 2006 -2026 is 306 ha.
Scenario 2 ‘Policy On’
5.52 Under this scenario overall floorspace requirements amount to 1.47 m2. This is less than
Scenario 1 despite the higher numbers of jobs envisaged. This is the result of growth
being focused in sectors requiring office and technology space which are occupied more
2
efficiently in terms of jobs/m than distribution and manufacturing uses.
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Table 5.14 – Floorspace Requirements Scenario 2
2004 – 2011 2012 – 2016 2017 – 2021 2022 – 2026 2027 - 2031 2004 - 2021 2004 - 2031
B1a/B1b 198,956 192,504 192,797 193,089 193,383 584,256 970,729
B1c/B2 34,685 24,775 24,775 24,775 24,775 84,235 133,785
B8 85,825 70,515 70,515 70,515 70,515 226,856 367,887
319,466 287,794 288,087 288,380 288,674 895,347 1,472,401
5.53 Floorspace requirements are dominated by office and technology (B1a/b) space which are
predicted to grow by 584,000 m2 by 2021 and 970,000 m2 by 2031. Light and general
manufacturing space is predicted at the same level as under Scenario 1 (this is driven
entirely by relocations). Distribution (B8) floorspace requirements are much reduced from
2
Scenario 1 at only 368,000 m . This reflects deliberate policy choices envisaged under
this Scenario.
5.54 If converted into land requirements, Scenario 2 would require the following in terms of land
supply (noting that for offices/technology space the requirement is based on business park
plot ratios rather than those achievable in CMK and other centres).
Table 5.15 - Scenario 2 – Land Requirements
2004 – 2011 2012 – 2016 2017 – 2021 2022 – 2026 2027 - 2031 2004 - 2021 2004 - 2031
B1a/B1b 54.7 52.9 53.0 53.1 53.2 160.7 267.0
B1c/B2 8.5 6.1 6.1 6.1 6.1 20.6 32.7
B8 21.0 17.2 17.2 17.2 17.2 55.5 89.9
84.2 76.2 76.3 76.4 76.5 236.7 389.6
5.55 The overall land requirements under Scenario 2 are therefore less than Scenario 1 at 390
ha. This reflects the limited growth in B8 which requires far more land for given levels of
employment than other sectors. Requirements are dominated by office/technology (B1a/b)
267 ha, 68% of all land required. The overall land requirement 2006 -2026 is 292 ha
(including CMK sites).
Comparisons of Scenarios Against Past Development Trends
5.56 Employment Land Review Guidance (ODPM 2004) sets out a number of alternative means
of calculating future employment requirements. Our approach has been based upon
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economic scenarios using employment densities as this allows potential policy options to
be fully explored. An alternative approach which is useful for comparison purposes is to
consider past trends. Data on floorspace completions for office and industrial floorspace
built over the period 1997 – 2006 is available. For comparison purposes we have
examined completion rates over the short term (5 years) and longer term 10 years and
compared these to predicted take-up rates (from Scenario 1 and Scenario 2).
5.57 Figure 5.1 below illustrates the comparison for offices/technology space over a ten year
period using average development rates.
Figure 5.1 – Comparison of Predicted Development Rates (10 Year Period)
Comparison Offices
40,000
35,000
Scenario 1 Ave
Floorspace m2
30,000
Demand
25,000
20,000 Scenario 2 Ave
Demand
15,000
10,000 5 Year Trend
5,000
- 10 Year Trend
1 2 3 4 5 6 7 8 9 10
Year
2
5.58 The 5 year development trend represents the highest level of demand at 36,000 m per
2
annum with Scenario 2 slightly lower at 34,700 m . The long term development trend
represents a slightly higher average demand than Scenario 1. It is however worth noting
that in Scenario 1 job growth is limited below that experienced in recent years by adhering
to the MKSM reference value of 44,900 jobs to 2021.
5.59 Industrial/distribution development rates are compared against the scenario in Figure 5.2
below.
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Figure 5.2 – Comparison of Predicted Development Rates (10 Year Period)
Comparison Industrial / Distribution
80000
Built Floorspace m2
70000
Scenario 1 Ave
60000
Demand
50000
40000 Scenario 2 Ave
Demand
30000
20000 5 Year Trend
10000
0 10 Year Trend
1 2 3 4 5 6 7 8 9 10
Years
5.60 In both cases the trend data is significantly above that predicted by the scenarios. The
following are likely explanations:
1. Scenario 2 represents a deliberate policy choice to limit the growth of distribution
space therefore demand is limited.
2. Both the short term and long term development rates include very high peaks in
the development in 1999 and 2003 which are likely to distort the figures.
3. Scenario 1 reflects a lower level of overall job growth than the period upon which
the development floorspace figures are based (1997 – 2006).
Conclusions
5.61 The key points are:
• Overall demand for floorspace from employment sites, centres and in CMK is
2
expected to rise to between 1.47 million to 1.65 million m (2004 – 2031), by 2021
2 2
requirements will have risen to 0.9 million m to 1.07 million m ;
• Land requirement terms (expressed as a maximum figure due to the use of low site
densities for office space in CMK) would lead to a requirement for between 237 ha
– 258 ha by 2021 and 389 – 423ha by 2031;
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• In Scenario 1 the base case floorspace requirements are dominated by the
distribution sector (reflecting relatively low employment densities and the growth in
this sector in the recent past).
• Under Scenario 2 growth is focused towards offices reflecting policy choices and
the fact the job growth under this scenario is not constrained by the MKSM
Monitoring figure. This scenario does include a deliberate policy choice to curtail
the growth for distribution and logistics (B8) most likely through limiting the land
supply for this sector.
5.62 Further analysis has been undertaken of the impact of housing growth on the local
economy. This has concluded that there is a relationship between housing growth and
jobs. This is influenced by the size of the settlement with a particular change in
settlements about 200,000 population. The conclusions from this analysis is that:
5.63 Based on this analysis it is possible to predict potential growth in employment fuelled by
housing and therefore increases.
• By 2021 at 26,000 increase in employment from 2004 (not allowing for the
difference in start dates) achieving 58% of the MKSM Monitoring reference value.
• By 2031 42,000 additional jobs.
5.64 Section 6 compares the scenarios against likely supply.
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6. CONTRASTING FUTURE DEMAND/SUPPLY
6.1 The previous two chapters have outlined the total supply and demand within the study area
under a number of scenarios. This chapter compares the amount of supply with that of
demand to assess whether the predicted supply of employment floorspace will be sufficient
to cope with expected demand.
Scenario 1
6.2 The projected demand for floorspace within Milton Keynes to 2031 under Scenario 1 is
shown below.
Table 6.1 – Floorspace Requirement under Scenario 1
2004 – 2011 2012 – 2016 2017 – 2021 2022 – 2026 2027-31 2004 - 2021 2004 - 2031
B1a/B1b 129,832 122,216 121,373 120,530 119,688 373,420 613,638
B1c/B2 34,685 24,775 24,775 24,775 24,775 84,235 133,785
B8 193,430 178,120 178,120 178,120 178,120 549,671 905,911
357,947 325,111 324,268 323,425 322,583 1,007,326 1,653,334
Source: GVA Grimley, 2006
6.3 When compared to the 10 year trend data this scenario reflects a slightly lower level of
overall demand for office space. In contrast this scenario suggests industrial / distribution
2
space requirements significantly below trend data (average take up figures of c73,500m
per annum 1997 – 2006). However the trend figures do include a small number of very
large developments which may skew the long term trend (e.g. Tesco distribution plant). It
could also reflect much lower actual employment densities in distribution developments
than we have assumed on the basis of the best available guidance.
Table 6.2 – Land Requirements under Scenario 1
2004 – 2012 – 2017 – 2022 – 2027 – 2004 – 2004 –
2011 2016 2021 2026 2031 2021 2031
B1a/b 35.7 33.6 33.4 33.1 32.9 102.7 168.8
B1c/B2 8.5 6.1 6.1 6.1 6.1 20.6 32.7
B8 47.3 43.5 43.5 43.5 43.5 134.4 221.4
91.5 83.2 83.0 82.7 82.5 257.6 422.9
Source: GVA Grimley, 2006
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6.4 Under Scenario 1 the total demand for land to 2031 is 369.7ha, with the majority of
demand for B1a and B8 floorspace. The table below shows the anticipated amount of
supply from proposed employment sites.
Table 6.3 – Supply of Floorspace from Proposed Employment Sites, CMK & Other
Centres
B1/b B1c/B2 B8 TOTAL LAND B1 B2 B8 TOTAL
1,621,5
GRAND TOTAL (ALL SOURCES) 846,336 283,612 491,562 10 103.50 88.35 81.55 273.40
Source: GVA Grimley, 2006
6.5 The figure below compares the amount of anticipated demand with the supply from
proposed employment sites, etc.
Figure 6.1 – Comparison of Supply and Demand under Scenario 1 to 2021
(Floorspace m2)
Supply / Demand to 2021 (Scenario 1)
500,000
400,000
300,000
200,000
100,000
0
B1a/b B2 B8
-100,000
Source: GVA Grimley, 2006
2
6.6 It can be seen above that there is a deficit of B8 space amounting to around 58,000 m
sq.m equivalent to approximately 13 ha by 2021. There is a significant surplus of
B1a/B1band B1c/B2 space. Given the potential surplus of light and general manufacturing
land which broadly has the same characteristics as land suitable for distribution we would
argue that no further land allocations are required prior to 2021.
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6.7 Figure 6.2 below presents the analysis of demand and supply up to 2031.
Figure 6.2 – Comparison of Supply and Demand Scenario 1 to 2031
Supply / Demand to 2031 (Scenario 1)
500,000
400,000
300,000
200,000
100,000
0
-100,000 B1a/ B1b B1c/ B2 B8
-200,000
-300,000
-400,000
-500,000
6.8 This analysis confirms that the deficit of B8 space will grow substantially 2021 – 2031
2
leading to an overall deficit 414,349m equivalent to approximately 100 hectares of land.
However, it should be noted that there is a potential surplus of 383,000 m2 in B1c/B2
floorspace. This land will share the broad characteristics of land suitable for B8 uses.
However it should be noted that not all of this land is likely to be suitable for B8 purposes
particularly smaller infill sites in the established industrial areas which will lack the plot size
suitable for B8 uses. The overall conclusion is that some additional B8 land would be
required post 2021.
Employment Land Analysis
6.9 Figure 6.3 presents an analysis of employment land to 2031 supply against demand. In
order to provide a meaningful analysis for office/technology uses we have assumed that all
of the capacity in CMK and other centres will be developed by 2031, this has therefore
been deducted from the overall requirement to establish a residual surplus/deficit which
would need to be addressed in out of town locations.
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Figure 6.3 – Employment Land Demand and Supply Analysis
Demand Supply Scenario 1 2031
150
100
50
0
ha
B1a/ B1b B1c/ B2 B8
-50
-100
-150
6.10 It can be seen above that when only taking into account the demand for employment land
outside CMK under Scenario 1 there is a deficit of B8 (warehouse) land in the order of 100
ha by 2031. It would appear however that if CMK is developed to its potential, there would
be enough capacity to accommodate the predicted demand for B1 (office) space without
the need for additional land allocations. As can be seen above, there would be a surplus of
around 60ha of B1a/B1b land and around 90 ha of B1c/B2 land, suggesting that under
Scenario 1, some sites would not be required and could be re- allocated.
6.11 We would anticipate that the overall supply of B8 land would be exhausted by 2015,
however as discussed above given the suitability of some of the stock of B1c / B2 land for
B8 uses then additional allocations may not be required until post 2021.
Comparison of Demand Against Commitments
6.12 We have also assessed demand under the scenarios against commitments (outline and
full planning consents) from 2007 onwards. Figures 6.4 and 6.5 compare this against
demand.
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