Levelling up in the West Midlands have been boosted by a multi-billion pound partnership between West Midland Combined Authority (WMCA) and Legal & General (L&G).
West Midlands Mayor Andy Street and Legal & General CEO Sir Nigel Wilson have today signed an agreement which will see L&G invest £4bn in the region.
The landmark deal features a commitment to a seven year programme of L&G investment in housing, regeneration, net zero, transport and more - and is the first of its kind on this scale for the financial services company, which is one of the world’s biggest investors.
The first investment will go to the development of The Junction - a brownfield site in Oldbury which has lain empty for over 20 years.
What are the key goals for WMCA in its partnership with L&G?
Levelling up in the West Midlands is at the heart of the agreement with WMCA saying the investment is designed to create vibrant, dynamic communities which will provide attractive environments for people to work, live and play.
It will also further enhance the West Midlands as a driver of UK economic growth - building on WMCA’s 2022 Investment Prospectus which offers a range of development opportunities for investors, including L&G.
The L&G partnership follows partnership agreements set up with WMCA since 2018, with organisations including Lovell and St Modwen.
WMCA brings together 18 local councils and three Local Enterprise Partnerships to oversee the transfer of powers and funding from Whitehall to the region.
Alongside investment into new commercial developments, WMCA said the agreement envisages a major contribution by L&G into climate-friendly projects, local communities and social and affordable housing, including build-to-sell and build-to-rent – providing high-quality homes across the range of tenures.
The agreement will also support the region’s target to deliver 215,000 new homes by 2031, as set out in its ground-breaking Housing Deal with Government in 2018.
WMCA pointed out that since the Housing Deal was signed, the West Midlands has secured upwards of £600m from Whitehall to drive regeneration with new housing and commercial schemes focussed predominantly on derelict or vacant urban sites, often referred to as brownfield land.
The WMCA said that using a nationally leading ‘brownfield first’ approach, WMCA investments have unlocked scores of disused industrial sites for new homes and jobs with developers required to make at least 20% of those new properties affordable under the WMCA’s own locally applied definition, linked to real world local wages rather than property prices.
The partnership also comes as WMCA announced £17m investment in cycle and walkways across the West Midlands.
What are the key goals for L&G in its partnership with WMCA?
Established in 1836, Legal & General is one of the UK’s leading financial services groups and a major global investor, with over £1.4 trillion in total assets under management (as of March 9 2022).
It also provides asset origination capabilities and says that, together, these underpin their retirement and protection solutions.
The financial services company is known as a leading international player in pension risk transfer, in UK and US life insurance, and in UK workplace pensions and retirement income.
It says: “Through inclusive capitalism, we aim to build a better society by investing in long-term assets that benefit everyone and have invested over £30bn in levelling-up regional economies, including through major UK-wide regeneration schemes.”
Across the West Midlands, Legal & General has already invested more than £2bn in a number of major schemes and local businesses including:
- The 3 Arena Central development, the Midlands regional hub for HM Revenue and Customs (HMRC)
- Two Build to Rent schemes within Birmingham’s Jewellery Quarter, delivering 600 new homes and 12,000 new jobs
- Onto, an electric car subscription service - now worth £2million a month in revenue.
- The Birmingham Health Innovation Campus with the University of Birmingham, as part of our Bruntwood SciTech joint venture at a cost of £210m
- Birmingham’s first smart-enabled building, Enterprise Wharf
- L&G are the largest provider of affordable homes across the West Midlands.
- Committed £100,000 of funding to support businesses entering or growing in the healthcare, technology and wellbeing sectors
What have the WMCA and L&G said about the partnership in their own words?
Andy Street, Mayor of the West Midlands and chair of the WMCA, said: “The unveiling of this £4 billion partnership agreement with L&G is a prime example of how the West Midlands is getting on and delivering Levelling Up. This major investment will help regenerate long neglected areas across the West Midlands, provide affordable homes in the communities where the need is most felt, and supercharge economic growth in the years ahead.
“The scale of the ambition L&G is showing is evident in both the huge sums involved and the breadth of projects envisioned. It is a tremendous vote of confidence in the future of our region from one of the world’s biggest investors, and I am delighted L&G came to the table and agreed such a monumental commitment with us.
“I cannot wait to see this investment rolled out, projects underway, and the lives of our residents changed for the better.”
Sir Nigel Wilson, CEO of L&G, added: “We have been investing across the UK in partnership with cities and universities for a decade. It’s part of our ‘Inclusive Capitalism’ approach and has delivered terrific economic and social results. With Andy and his colleagues as ambitious partners at WMCA, we can take this to a new level.
“The West Midlands economic plan, resources and skills make it an attractive destination for trade and investment from across the world; our role in this is to put UK funds including pension savings to work here so UK savers benefit from UK prosperity.”
Cllr Mike Bird, WMCA portfolio holder for Housing and Land and leader of Walsall Council, said: “There’s no doubt that Covid has been hard on our regional economy but this partnership brings together public and private sector investment and skills on an unprecedented scale in the West Midlands.
“It also shows how our determination to press on and continue making key investments throughout the pandemic, bringing solid delivery on the ground, has been critical in driving private sector confidence and trust.
“The level of investment that L&G has set out will be an incredible shot in the arm for the West Midlands as we continue our recovery, helping to bring sustainable economic growth that benefits all our communities and supports our ambition to be a net zero region by 2041.”
L&G’s Director of Levelling Up, John Godfrey, adds: “Towns, cities and regions across the UK can do much, much better – this is the essence of the levelling up agenda. This framework agreement with the West Midlands enables political will to combine with financial resource so policy intentions become deliverable realities. We fully expect this to be an exemplar of what can be achieved with the right mix of devolution and determination.”
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