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Public Appendix A PUBLIC APPENDIX A 1.1.1.1 FUTURE HIGH STREETS FUND FULL BUSINESS CASE (FBC) A business case is a management tool and is developed over time as a living document as the proposal develops. The Full Business Case (FBC) should summarise the results of all the necessary research and analysis needed to support decision making in a transparent way. The evidence to support the investment decision must be set out in the HMT five case business case model: Strategic, Economic, Financial, Commercial and Management. In its final form the FBC becomes the key document of record for the proposal which summarises the objectives, the key features of implementation management and arrangements for post implementation evaluation. When you have completed your business case, please submit it to the Future High Streets team on [email protected] Please also confirm separately with your delivery manager once you have submitted, via an email with no attachments Version 1.0 Version Date 7 May 2020 Lead Author Simon Machen Place March Town Centre Senior Responsible Officer within Local Authority Paul Medd (SRO) SRO Sign-off Name: Paul Medd Date: Figure 1.1 Figure 1.2 Page 1 of 119 Figure 1.3 MHCLG Full Business Case PROJECT SUMMARY WHAT IS THE INVESTMENT PROPOSAL? Local Authority: Fenland District Council High Street: March Town Centre Brief summary of proposal [499 words]: March is an historic market town that sits at the centre of the Fenland District on the course of the River Nene. March’s heritage is rooted in the railway and the town is well connected through local and regional transport networks. The 2009 Fenland Retail Study and 2019 Growing Fenland strategy identified March as one of Fenland’s two major town centres, providing a range of facilities for an extensive rural catchment area. The Challenges In common with many rural towns, March has suffered from the national trends affecting the way we use our town centres. However, there are specific local factors that are affecting the vitality of the town centre. Broad Street is the at the heart of our town. It is a three-lane carriageway which cuts the town centre in half, providing the only connection over the River Nene. Broad Street is difficult to cross and experiences significant congestion which discourages visitors and shoppers. Similarly, the River Nene waterfront is hidden from the public, being difficult to access and impossible to appreciate. The River Nene and Broad Street are major barriers in the town centre and provide a textbook example of local severance. There are a number of derelict, unused and underused buildings throughout the town centre. This includes properties surrounding the Market Place with its beautiful Town Hall, units along Broad Street and in the Acre Road area which has a particular concentration. Vacancy rates are increasing, and the town centre continues to lose important retail anchors. There is no 24-hour economy in March, the hospitality and leisure offers are poor, and the available first floor space on Broad Street and beyond has failed to attract residents or businesses. All of this is evidence of a town centre struggling with a deteriorating investment climate and large viability gaps. To address these issues we are proposing five transformational projects: • A dramatic intervention to transform Broad Street • Opening up the Riverside areas to improve visibility and access • Redeveloping the historic Market Place • Acre Road Regeneration • Reactivating vacant units & Flats Over Shops programme These proposals respond directly to the 25 factors that the Institute of Place Management has identified as influencing the vitality and viability of local high streets and deliver against the FHSF objectives. By addressing the challenges facing March, our proposals have the potential to create transformative structural change, providing an attractive and vibrant place where residents and visitors are able to spend more time enjoying the high street. These proposals reflect thinking at town, district, county and Combined Authority levels, and are deliverable within the timescales required by the FHSF programme. Narrative Summary Our assessment finds that for the £11.3m investment requested from the Future High Streets Fund, this would generate a total of £40.0m of discounted benefits. This is a benefit cost ratio of 2.4 (Initial BCR FHS Only) or 3.3:1 (FHSF + Co-funding – private cost). The programme will leverage £10.5m private sector funding, and regenerate new and existing, commercial, retail and residential space. Overall funding requested: £11,326,949 Page 2 of 119 MHCLG Full Business Case Figure 1: Wider Study Area Spatial Plan The plan below produced as part of our research shows the wider area study context, which identifies a tightly defined town centre footprint as well as the strategically important station corridor. The spatial context reflects the Growing Fenland report (2019) and was agreed with district and town council members during workshop sessions. Figure 2: Longlisted Intervention Option Packages The plan below shows the long list of intervention packages that were considered. The severance issues are concentrated in Package 3, where the three-lane carriageway of Broad Street cuts the town centre in half and footfall is further constrained by the single river crossing pinch-point over the River Nene. Page 3 of 119 MHCLG Full Business Case Figure 3: Preferred Option Key Plan This plan provides a summary of the preferred option. Full details are available in Appendix B. For details of land ownership see Appendix F. Figure 4: Severance issues in March Town Centre This plan shows the extreme severance issues which run on both East to West and North to South axes. Page 4 of 119 MHCLG Full Business Case Alignment with FHSF Core Objectives The preferred option has been designed to respond to local challenges and the wider strategic objectives of the FHSF programme. These include: • ‘renew and reshape town centres’ – the programme includes proposals which will fundamentally change the way in which March functions as a town centre. This includes improvements in Broad Street which will improve pedestrian flow and footfall, changes in use which will support a 24-hour economy and support resilience, and improvements which will open up underused and derelict areas for commercial development. • ‘improve experience’ - the improvements to Broad Street, the Riverside, the Market Place and supporting public realm will ensure that existing custom is retained, while providing a new offer to businesses and the wider community. These improvements will be visual, environmental and experiential. • ‘drives growth’ – the changes will tackle the existing financial viability gap and release new opportunities for the private sector to re-invigorate the town centre. The provision of mixed use and residential space will drive footfall and dwell time, and help March capitalise on its unique historical and riverside assets. • ‘structural and significant’ – the interventions will change the way in which the town centre functions. These go beyond both ‘surface level change’ and ’beautification’ and consist of important changes in form and land use. A detailed analysis of costing schedules provided by Stockdale QS shows that the proportion of FHSF funding allocated to ‘beautification’ is well below the fund’s 5% maximum. Why the investment is being made? The FHSF investment will arrest the decline in March town centre and enable the area to make the most of its untapped potential. By itself, such investment would not (and has not been) forthcoming from the private sector because of viability and other issues. In addition, there is no other funding mechanism which could realistically drive the required public realm improvements. These proposals amount to a fundamental redesign of how the town centre functions as a retail, entertainment and residential hub. They will ensure growth and resilience and enable the town to surmount its physical and geographic constraints. The following site will be acquired through the FHSF investment. Land and/or Current use Cost (FHSF) Remediation Intended future use Buildings to be /redevelopment cost acquired 1, 2, 3-4, 5, 6 Acre Vacant £4.2m Costs include site Mixed-use Road & Market acquisition costs, development Premises, Acre Road planning costs, viability gap, public realm components, expressed as outturn. This will unlock £10.2m private sector match. What types of physical infrastructure is the FHSF funding required for? Please tick all that apply: Public transport, traffic Public facilities (local government/ Severance and ✓ ✓ management, road health/ education/ leisure) connection improvements and access improvements Digital infrastructure Utility network extension and Public Realm Works ✓ capacity reinforcement Other (please provide details) Page 5 of 119 MHCLG Full Business Case Value for Money Assessment Summary The table below provides a summary of the economic appraisal undertaken for the interventions proposed in March town centre. Table 1 Value for Money Assessment Overview: Preferred Option Adjusted for Deadweight / Optimism Bias Nominal Value of Benefits £70.4m (£84.3m-£13.1m) Present Value of Benefits £40m (£47m-£7m) Nominal Value of Costs £12.7m Present Value of Costs £12.1m Initial BCR (FHSF only 2.4 Initial BCR (FHSF + Co-funding) 3.3 Adjusted BCR (includes non-monetised bens) 2.9 Source: Table 8 (Appraisal Summary Table), Table 15 (Net Present Value Analysis) When considering the total net present value of costs and benefits, the interventions are expected to generate a cost-benefit ratio of 2.4. This represents ‘high value for money’ - based on the guidelines provided in the Department for Transport Value for Money guidance, which considers a BCR of between 2 and 4 as representing a high value for money. We have estimated the net private benefits using land value uplift associated with change of use as per MCHLG guidance. In this case the land value uplift reflects the economic efficiency benefits of converting land into more productive use.
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