BCSC: Developer TIF needed for economic growth
Published: 14 September, 2011
Retail property organisation BCSC and top retail developers have asked Government to introduce a developer-led Tax Increment Financing Model (TIF) that would allow the private sector to lead economic growth, and potentially unlock up to 50m sq ft of stalled retail schemes in the UK.
The call comes in a letter sent to Nick Clegg last week signed by developers including Land Securities, Hammerson, Westfield, Lend Lease, Grosvenor, Stanhope and Queensbury.
The developer led TIF model, the Local Tax Re-Investment Programme (LTRIP), would allow projected increases in business rates revenue created by new development to be used to secure private sector investment in public infrastructure.
The revenue raised would be used to finance debt or repay equity used to fund these works, bridging the viability gap and allowing developers to start work on new or stalled schemes. Schemes will return this increased business rate income to local authorities after the term of agreement between the two parties has expired.
Commenting on LTRIP, BCSC President and Managing Director for Retail at Land Securities Richard Akers said: “In our view this development finance model responds perfectly to the Government’s pro development and private sector led growth agenda. Implementing LTRIP should be relatively straightforward, and this letter sends a clear message to the Deputy Prime Minister that some of the largest developers in the country are ready to start building again if he can help deliver this model.
“Retail provides 3m jobs in the UK and adding retail property more than doubles this number. Clearly towns and cities in the UK continue to need inward investment and if Ministers are prepared to show leadership on this issue they will get that from our sector.”
