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Making the economic case for better streets and places.

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Presentation on theme: "Making the economic case for better streets and places."— Presentation transcript:

1 Making the economic case for better streets and places

2 Scene setting UK population increased by 5.8% between 1998 and 2009, accompanied by £10 billion increase in spend over that period That spending is not reflected on the high street Shopping as a share of all trips is falling On average there were 19% fewer shopping trips in 2011 compared to 1995-7 High street spending only accounted for half of all retail spend in 2011

3 Investment in the public realm Generally held view that it’s good for retail and regeneration Challenging area to measure; limited number of cost benefit analyses, mostly case study evidence Focus on footfall, economic activity and consumer and business perceptions Diversity of retail offer beyond the scope of this paper

4 Methodological challenges difficult to transfer the findings to formal economic forecasting and appraisal methods Some information (e.g. prices, rents and attributes of buildings) is confidential Hard to prove empirically that an improved pedestrian environment has had a direct impact on sales (to the exclusion of other factors) How to measure indirect benefits Boundaries are fuzzy


6 Report structure The report reviews the evidence for: Impacts on existing business Urban regeneration Improved consumer and business perceptions As a result of improvements to the public realm.

7 Impacts on existing business Well planned improvements to public spaces can improve retail sales by 30% and retail footfall by 10-25% There is a general finding that pedestrians and cyclists are better customers and spend more than people arriving by motorised forms of transport - even when they buy smaller quantities

8 Urban regeneration The importance of improving public spaces is commonly acknowledged. This section looks at the evidence of benefits on: Investment, tourism and business start-up rates Effects on property and rent Employment benefits, and Social exclusion

9 1. Local economic development Improving the public realm is an important part of urban regeneration Limited evidence linked to start-ups (figures included in total turnover) need to account for displacement and substitution effects Some start-ups likely to benefit, tourism also seen to benefit

10 2. Effects on property and rent Evidence that public realm improvements positively affect property prices Hong Kong controlled study found 17% increase in rental value following pedestrianisation Walking and non-motorised projects increase land values from 7-300% Relationship to property values shows increases of 21.7% for retail rents and 24.2% for commercial rents

11 3. Employment benefits More jobs are created through pedestrian and cycling construction projects than road construction projects Higher employment can be inferred from higher turnover, but difficult to prove additionality Sheffield reported the creation 321-385 net additional jobs, based on attribution rates of 20- 90% depending on how close to the original investment

12 4. Social exclusion Substantial urban regeneration projects often located in areas of deprivation Few studies evaluate whether property or infrastructure improvements deliver for those communities Perceptions of an area really matter – can reinforce feelings of social exclusion or raise self-esteem and persuade business to invest

13 Consumer & business satisfaction Broadly positive link between urban environment and commercial returns Retailers over-estimate extent to which customers drive and importance of parking Shoppers more concerned by range of shops and the attractiveness of the environment A good street environment is so important, people are willing to pay for it It’s about the experience

14 Conclusions Challenging to establish a causal link between public realm improvements and benefits to business But there is a good body of case study evidence supporting the case Some businesses appear out of step with their customers People show a willingness to pay for better streets

15 Conclusions policy recommendations Suggestions: internet sales tax, restrictions on out of town developments and change of use […] and congestion charging – and reinvest funds raised in the high street Investigate consumers’ willingness to pay for local environmental improvements Businesses over-value the importance of parking and car access – communicate the importance customers place on quality public areas

16 Ensure that public realm improvements are carefully designed to benefit the local population too – higher property prices and rental value can also have a negative impact on local access and business diversity. [how to link to community street audits?] and Better evaluation built into project design policy recommendations, continued

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