Ravi Pankhania writes:
The announcement has, understandably, caused no little consternation. Birmingham residents are worried about the consequences of a fire-sale of the Council’s property. The City Council owns 26,000 acres of land – 40% of all land within the city’s boundaries. It owns approximately 6,500 property assets, which generate £32mn in revenue and £30mn in capital receipts per annum.
This portfolio represents a huge economic footprint; its future will have ramifications not just for the council, but the city writ large. A number of groups such as Historic England and Arts Council England have voiced concerns over the fate of local heritage in the event of a sale, given that, of 6,500 assets on the portfolio, 330 are deemed to be of historical significance. These include beloved buildings such as the Jacobean Aston Hall, the Library of Birmingham, and the Moseley Road Baths.
If such a sale is to take place, it should be carefully planned and managed. By working closely with each other, developers and local government can craft a strategy for this portfolio – one that preserves cultural heritage, improves the city’s stock of commercial and residential property, and helps the City Council meet its financial obligations.
Certainly, the sale of any heritage buildings should not be considered. The people of Birmingham did not cause this fiscal crisis and should not be forced to pay the price in terms of their intangible cultural heritage. The inclusion of historic buildings would also poison the atmosphere of the sale. Public support for it would drain away, and buyers would shy from involvement in such a controversial project. This would make the arguably necessary sale of other assets on the portfolio much more difficult. Whatever else is decided, a cast-iron guarantee of the West Midlands’ architectural heritage is surely the first step.
The sale of other assets should be carefully planned. An asset strip of the city’s portfolio would not benefit its residents, and would, again, simply rouse public anger. One idea that has been suggested would be for Birmingham City Council to sell a portion of its residential and commercial property portfolio to developers – but with a number of stipulations. Developers would be required to improve the quality of the stock that they purchase, and to manage it to a high standard. After an agreed time period, the Council would be offered the first opportunity to buy back these assets.
In other words, ‘investment’ should be the City Council’s watchword during a putative sale. Such an approach would bring several benefits to the city. The initial sale would, of course, help the City Council meet its immediate financial obligations. But developer trusteeship would make a positive impact as well. Because of the sheer size of the City Council property portfolios, many assets are underused or derelict. Developers could play a key role in restoring the vitality of these sites – upgrading, renovating, and bringing them under more exacting management.
Additionally, the resources of developers could be used to adapt existing structures to changing patterns of work and life seen since the pandemic. A carefully managed sale could, for example, see a new spate of attractive mixed-use redevelopments in central Birmingham, helping commercial office sites to adapt to the decline of traditional modes of work. This would also go some way to address chronic housing shortages. Finally, once Birmingham City Council has restored its finances and repurchased these sites, the upgrades made since the sale would increase yearly revenues from the portfolio. In this way, the city’s finances could be put on a surer footing for the future.
Ultimately, the City Council should not take the easy route of a quick sale to meet financial obligations. An investment-based approach is more likely to command public confidence and would pay social and economic dividends over the long term. Above all, transparency and careful thought is key. This £2.4bn portfolio represents a major chunk of the city of Birmingham itself; it must be handled with care and consideration for all involved.