Business News Round Up (31/07/2023)
CBRE research reveals Scottish office market performance in second quarter of 2023
Leading real estate advisor CBRE has released its latest figures on the Scottish office market during the second quarter of 2023. Commenting on the Scottish office market prospects, Angela Lowe, Head of Advisory and Transactions at CBRE Scotland, said: “The role of the office has changed over time to maintain alignment with occupier requirements, as the way we use the workspace evolves. The movement from cellular offices to flexible and agile formats has reduced the average space requirement per employee, and hybrid working is challenging historic norms in working practices. Occupiers focusing on talent attraction and retention are considering a range of flexible, amenity-rich spaces to curate the optimum user experience. But of course, in tandem with these trends, demand for office space ultimately continues to be driven by the wider economic environment. “Future growth for office real estate is largely determined by demand metrics such as GDP growth, working age population, access to highly skilled workers and forecast office-based employment. All of these fundamentals could impact office demand and subsequent size of the occupier footprint in the next decade in Scottish cities. Meanwhile, markets with sufficient development or capacity to refurbish second-hand units will be able to capitalise as trends in ESG and design exacerbate demand for quality space.”
£1bn milestone as NPIF continues to support business expansion
More than £1bn has been invested in Northern companies after the Northern Powerhouse Investment Fund (NPIF) surpassed a significant milestone. It has made £405m of direct investments, enabling £613m of private sector co-investment. Launched in 2017 by the British Business Bank, NPIF provides commercially focused finance through its microfinance, debt and equity finance funds which offer financing ranging from £25,000 to £2m, specifically to help small and medium-sized businesses secure the funding they need for growth and development. To date, it has supported 1,188 companies through 1,636 investments and has also helped create more than 7,900 jobs across the region. The North West has secured £537m of direct and private sector co-investment since the launch of the fund. Recent success stories include two in the North West region, MyPura, a husband-and-wife-founded eco-friendly nappy company that recently expanded internationally into the USA, and Chester-based ChloBo, a handmade jewellery brand that is also expanding overseas. Founded in 2019, Cheshire-based MyPura secured a £4.25m funding round in February 2022.
Robust industrial strategy a £230 billion opportunity for economy
The UK faces missing out on a £230 billion opportunity if it cannot provide a more robust industrial strategy to funnel STEM graduates into work relevant to their expertise. Competition from more lucrative employment in the finance and business sectors, as well as a hostile environment to immigrants in the UK driving international students away, is creating a talent shortage in the scientific fields the country was hoping to drive the economy after Brexit. A new study produced by the Society of Chemical Industry (SCI) and L.E.K. Consulting has assessed the socio-economic benefits of the UK government developing and delivering a new, modern industrial strategy. The strategy would focus on industries identified by Chancellor Jeremy Hunt as being a priority for future growth. These include heavy industry, cleantech, life sciences and emerging digital technologies. Part of this plan would see incentives and tax breaks deployed to aid spending in the STEM sector. With a major economic slowdown and heightened inflation continuing to bite, many firms are scaling back on research and development (R&D) investments in the hope of weathering the storm. But this threatens the UK falling behind similar economies in terms of scientific development – at precisely the time when it had suggested becoming a leading technology hub would make up for revenues lost to the Brexit process.
Circularity Scotland folded with debts of £86 million
The company set up to administer Scotland’s Deposit Return Scheme (DRS) had debts and liabilities of more than £86m when it fell into administration. Circularity Scotland, a not-for-profit company funded by the drinks industry, called in administrators in June. Companies House documents, reported in the Mail on Sunday newspaper, show it had liabilities £86.2m and assets of £2.1m. Some 66 staff lost their jobs when the company folded, following the decision to delay the DRS until at least October 2025, in order to bring it in line with a planned date for a UK-wide scheme. The Scottish Government blamed Westminster’s refusal to allow glass in the scheme for the latest delay, accusing the Conservatives of sinking Scotland’s DRS and undermining devolution. However, the UK Government said the delay was entirely the decision of ministers in Edinburgh, who failed to design the scheme properly. The Companies House documents show that Biffa is the largest creditor with a liability of £65m. The company was contracted to provide logistics for the DRS.
https://www.insider.co.uk/news/circularity-scotland-folded-debts-86-30590297