Work on North Tyneside’s first speculative business park since the credit crunch has been completed and developers expect to announce the first tenants in the next few weeks.
The Hellens Group’s £2.6m West Chirton development near the A19, known as Elm Park, was funded by a £460,000 loan from the North East Local Enterprise Partnership’s (LEP) North East Investment Fund, £1.1m from the European Regional Development Fund (ERDF) and the company’s own money.
Comprising 17 units, the 34,000sq ft of business space is expected to create or safeguard 68 jobs when it is fully occupied.
Hellens Group chief executive Gavin Cordwell-Smith said: “We’ve received significantly more interest that we expected.
“We tend to find that businesses like to see units completed before committing themselves, but we’ve had a number of viewings already and are discussing terms with a number of parties.’
“The units are primarily aimed at small and medium-sized businesses and we’re hoping to attract manufacturers, possibly those working in the offshore field. From the interest we’ve received, there is significant demand.”
Hellens also completed the second phase of the Teal Farm business park development at Washington in February. The first part was completed in 2008 and let during the recession, but there was no bank finance available for the second phase.
The £1.2m for development of the four units was funded through a £200,000 Growing Places Fund loan from the North East LEP and a £680,000 grant from the ERDF.
Teal Farm is now 50% let and Cordwell-Smith is confident the units will be fully occupied by the end of the year: “We hope Teal Farm’s success will be emulated by Elm Park, West Chirton. The level of inquiries has been significantly higher than at Teal Farm, which suggests it will be.”
Hellens already owned the West Chirton site near the Silverlink roundabout and the Tyne Tunnel, but like Teal Farm, the project was put on hold for a number of years because of the recession and the lack of available funding.
Cordwell-Smith added: “We were hoping to develop the units sooner but, due to the lack of bank finance, progress stalled. Without the ERDF grant funding and the loan from the North East LEP we wouldn’t have been able to develop it.
“The North East LEP loan was really straightforward. The staff and consultants were very thorough in terms of due diligence.’
The North East LEP manages the North East Investment Fund, including Growing Places Fund and Regional Growth Fund contributions. Money from the fund is reinvested to supply future loans for developments aiming to improve the region’s economy.
Paul Varley of the North East LEP’s investment panel, said: “We are delighted that the West Chirton project is on course to welcome its first tenants and create more employment.
“The demand being experienced by West Chirton and Teal Farm developments shows the need for new high-quality business space in the North East and is an excellent indicator of improvements in the region’s economy.”