Legal & General to help build £350m Newcastle Science Central
Legal & General Capital, the principal investment arm of Legal & General Group, is to partner with Newcastle City Council and Newcastle University, to help build and finance the £350 million Newcastle Science Central development.
Science Central will become a major UK hub for scientific research, and technology businesses. The North-East's new devolution deal creates the opportunity to bring this powerful local vision to life, creating knowledge-based jobs for future generations in Newcastle and extending the Northern Powerhouse to "the North of the North".
Newcastle Science Central is one of the biggest urban regeneration projects of its kind in the UK. The 24-acre science and technology hub on the former brewery site, famed for brewing Newcastle Brown Ale, is located in Newcastle's city centre and is set to create over 4,000 jobs, 500,000 sq ft of office space, and 450 new homes. Legal & General Capital's initial £65 million investment will deliver over 200,000 sq ft of Grade A office space, facilitating significant economic growth in the City, and unlocking further investment in commercial and residential opportunities at Science Central.
Nigel Wilson, CEO at Legal & General, commented: "I am thrilled that Legal & General is investing in the future of Newcastle. This investment is further evidence of the power of 'bulldozer money' to deliver high-tech growth and jobs through regeneration in the North. Whatever the EU Referendum outcome, we need growth in the UK - and this is the way to deliver it."
Legal & General plans to invest £15 billion in UK infrastructure, direct investments and urban regeneration projects. It has already invested over £7 billion, and is committed to modernising Britain's great cities as it aims to invest £15 billion.
Councillor Nick Forbes, Leader of Newcastle City Council said: "Today's announcement is a major milestone for the partnership, and further testament to the progress taking place on Science Central through significant joint investments already made by both Newcastle University and the council.
"Legal & General Capital's investment is a major vote of confidence in Newcastle from one of the UK's leading investors, who have clearly recognised the enormous potential of Newcastle and the region. Securing the deal will act as a catalyst to attract further investment, putting us firmly on the map as a UK hub for the science and technology sector and creating knowledge-based jobs for future generations, sending out a strong message that Newcastle is open for business.
Professor Chris Brink, Vice-Chancellor of Newcastle University, said: "Today's announcement by Legal & General Capital is a reflection of what has been achieved so far and testament to the potential of Science Central as an exemplar of sustainable urban development.
"Building on our recent outstanding research successes, with the announcement of our three National centres - the National Centre for Ageing Science and Innovation, the National Institute for Smart Data Innovation (NISDI) and the EPSRC National Centre for Energy Systems Integration - this investment will take us a step closer to realising our vision for Science Central."
The deal represents the fourth project to be delivered since the start of Legal & General's partnership with the Regeneration Investment Organisation (RIO), launched at 10 Downing Street in January 2015. Bringing with it an extensive network of international investor contacts and deep property expertise, Legal & General is committed to co-invest £1.5bn into RIO pipeline projects alongside capital from other institutions and major overseas investors and is working with the government's inward investment body, UKTI, to attract an additional £15 billion of investment into critical regeneration projects that support UK growth.
Rachel Dickie, Head of Urban Regeneration at Legal & General Capital, added: "The delivery of Newcastle Science Central will help support the wider Newcastle economy and we are delighted to be working with Newcastle City Council and Newcastle University to deliver this major regeneration scheme. Providing an excellent match for our long term money, this public and private sector partnerships model demonstrates that we can unlock major regeneration projects that support the economic growth prospects of the UK by closing the funding gap, as well as delivering strong financial returns for our shareholders and policyholders."
Gordon Aitchison, Director, Investment & Development at LGIM Real Assets, said: "This partnership with Newcastle City Council and Newcastle University proves the importance of the private and public sector partnerships model in driving forward UK urban regeneration projects. We have been able to provide the necessary capital and skills to bring forward Newcastle Science Central and local government have provided the access and support to create this opportunity. We look forward to working with our new partners on this exciting scheme and attracting further investment into the area."
Newcastle Science Central is located in the city's Accelerated Development Zone, next to Newcastle United's football ground, St James's Park, and to the north of Newcastle train station.
For further information, please contact:
Tom Gough, Head of Communications, Legal & General Capital and LGIM Real Assets
0203 124 2777
Richard King, Head of Group Corporate Communications
0203 124 2095
Notes to editors:
Newcastle Science Central:
Originally the Elswick Colliery, then later the production centre for Scottish and Newcastle Brown Ale, Newcastle Science Central is the city's £350 million flagship project. It is a hub where investors, businesses, entrepreneurs, students, scientists and citizens can collaborate, innovate and develop solutions for tomorrow's cities; creating a global centre for urban innovation in the heart of the city.
The vision for Science Central is to be a new urban quarter in the centre of Newcastle which will be an exemplar of sustainable urban development. It will attract leading edge scientific and technology organisations to a mixed new community encompassing a variety of R&D, educational, business and residential uses. It will provide a financial and reputational gain to the partners.
A global centre for urban innovation in the heart of the city, the 24 acre Science Central project is a long term committed partnership between Newcastle City Council and Newcastle University. http://www.newcastlesciencecentral.com/
Legal & General Investments in Northern Powerhouse:
Legal & General is a significant investor in the Northern Powerhouse, and the Newcastle investment will be the Legal & General Capital's sixth major urban regeneration project across the North, adding to the Group's wider investment in the region. In Leeds Legal & General Capital has committed over £160 million to Thorpe Park, unlocking 7,000 new homes and 13,000 new jobs. It also owns 50 per cent of MediaCity UK in Salford, and has just announced plans with the Peel Group to double the size of the scheme and create £1 billion in development value. Additional investment in the region includes projects in Liverpool, Wakefield and a second site in Salford.
Legal & General Group Plc:
Established in 1836, Legal & General is a leading provider of insurance, savings and investment management products in the UK. The Group has a market capitalisation of £14bn (as at 31 March 2016) and is responsible for investing £746bn worldwide (as at 31 December 2015) on behalf of investors, policyholders and shareholders. Legal & General has over seven million customers in the UK for life assurance, pensions, investments and general insurance plans and over one million customers in the US who rely on us for life assurance. In 2015, Legal & General's operating profit (on the IFRS basis) was £1,455m and adjusted earnings per share were 18.58p for the period, an increase of 14% and 11% respectively.
For more information on Legal & General, please see http://www.legalandgeneralgroup.com/
Legal & General Capital:
Legal & General Capital (LGC) focuses on direct investments in four key sectors: UK Housing, UK Urban Regeneration, Alternative finance and Clean Energy. These reflect our aim to invest for the long term in economically and socially useful assets, to secure competitive returns and to create new asset classes for Legal & General's varied investment requirements, for our partners and for the wider marketplace. We work closely alongside other businesses within Legal & General to ensure the broadest range of skillsets are deployed on any project and to utilise principal investment and asset management synergies across the Group. Investments to date have included CALA Homes (housebuilding), Media City/Salford (urban regeneration), Pemberton (alternative finance) and NTR (clean energy).
LGIM Real Assets:
LGIM Real Assets is a division of Legal & General Investment Management (LGIM), one of Europe's largest institutional asset managers and a major global investor. LGIM manages £717bn in assets on behalf of over 3,100 clients (30 September 2015), providing products and solutions spanning all asset classes. LGIM Real Assets, headed up by Bill Hughes, has an aggregate asset value of £21.4bn (31 March 2016) and is responsible for the division's direct investment capabilities in property and infrastructure. LGIM Real Assets is made up of three specialist divisions, Legal & General Property (LGP), its property fund management arm, LGIM Infrastructure, its specialist infrastructure lending and investment division, and Commercial Lending Limited (CLL), its commercial lending arm.
Regeneration Investment Organisation (RIO):
The UK government is creating the ideal business environment for investment in regeneration projects across the UK. The Regeneration Investment Organisation (RIO) has a strong pipeline of urban renewal projects seeking investment in sectors including commercial, industrial, leisure, residential, retail and mixed use. These projects are at various development stages and typically are each worth over £100m in investment value. Over 40 regeneration projects are listed on RIO's website seeking more investment or development partners.