The North West Evergreen Fund, jointly with Lloyds Banking Group, has invested £9.5 million (approx. 11.6 mln) into Citylabs through the provision of a loan. Citylabs is the flagship redevelopment of Manchester's former Royal Eye Hospital led by developers Bruntwood.
Forming part of Corridor Manchester, the city's knowledge quarter, Citylabs is a new 100,000 ft² (approx. 9,290 m²) biomedical centre of excellence featuring high-specification flexible office and laboratory space.
Located on Oxford Road, it sits within Europe's largest clinical and academic campus, made up of Central Manchester University Hospitals NHS Foundation Trust, The University of Manchester and Manchester Metropolitan University. The development is expected to create 440 new jobs and add £60 million per annum to Manchester's income (gross value added).
Citylabs will open in spring 2014 and has already secured pre-lets to The Central Manchester University Hospitals NHS Foundation Trust Charity, The Manchester College, NHS spin-out TRUSTECH and Icon Developments the global provider of development services to the pharmaceutical, biotechnology and medical device industries.
The North West Evergreen Fund, which is made up of 16 local authority limited partners was established to provide funding to support real estate projects which are critical to the region's economy, generating jobs and growth.
It is capitalized through the European Regional Development Fund (ERDF) and other public money allocated under the Joint European Support for Sustainable Investment in City Areas (or 'JESSICA') initiative, which is managed by the European Investment Bank in the North West on behalf of the Homes and Communities Agency. The application to the EIB was led by the Association of Greater Manchester Authorities.
The Evergreen model provides loan funding to be invested in projects which will generate a financial return and will then be recycled back into the fund to help support further projects. The fund is advised by CBRE Indirect Investment Services Limited, the FSA regulated arm of CBRE, and co-chaired by Manchester City Council and Lancashire County Council.
The Evergreen/Lloyds investment follows recent investments in the project by Manchester City Council and the ERDF.
Sir Richard Leese, leader of Manchester City Council, said:
"This is another example of an innovative use of public funding to support private enterprise in these challenging times and deliver jobs and growth in the area. The Evergreen Fund is investing in priority schemes which unlock opportunities and stimulate the success of the region and Citylabs will make an important contribution towards this goal. Biomedical research is an exciting growth area which has the potential to make a very important contribution to Manchester's economy."
Tony Martin, Head of Investment Advisory at CBRE said:
"Citylabs is Evergreen's second investment, having already provided a £6 million loan to The Carlyle Group's Soapworks redevelopment.
"Evergreen was established to provide developers with an opportunity to secure much-needed finance for strategic sites that will make a significant contribution to the success of the North West's economy and Citylabs meets all our criteria. Evergreen's investment portfolio has already grown since we launched and we are in advanced negotiations with a number of other parties on schemes of differing sizes and focus, and hope to announce further investments shortly."
Lord Peter Smith, chair of the Association of Greater Manchester Authorities, added:
"The Evergreen Fund in Greater Manchester is helping to drive research and innovation in the region. This is the second major investment the fund has made and demonstrates its commitment to investing in major projects which promote economic growth."
Chris Oglesby, Bruntwood Chief Executive said:
"The availability of Evergreen funding is a key element to Citylabs' success, enabling our vision for creating an environment that will foster scientific innovation in the biome