ISLE OF WIGHT COUNCIL REGENERATION PROGRAMME

C - 9 Contents

1 SCOPE ...... 7 1.1 Document purpose ...... 7 1.2 Structure of the document ...... 7 1.3 Scope ...... 7 2 STRATEGIC CONTEXT ...... 9 2.1 Isle of Wight today ...... 9 2.2 Global and UK trends affecting the Isle of Wight ...... 10 2.3 Coastal town issues in the UK ...... 11 2.4 UK policy affecting development finance ...... 12 2.4.1. Business rate retention ...... 12 2.4.2. New Homes Bonus ...... 13 2.4.3 Devolution packages ...... 13 3 ISLAND AND COUNCIL CONTEXT: FOUNDATION FOR GROWTH ...... 14 3.1 The case for change: IoW Corporate Strategy and resources ...... 14 3.2 Economic Development ...... 14 3.2.1 Economic performance ...... 14 3.2.2 Tourism, industry, construction and commercial investment market ...... 15 3.2.3 Education, employment and skills ...... 17 3.3 Transport and Infrastructure ...... 18 3.3.1 Island connectivity ...... 18 3.3.2 The implications of growth on infrastructure ...... 18 3.3.3 Issues and opportunities for improvement ...... 19 3.3.4 The Solent Strategic Transport Investment Plan ...... 21 3.3.5 Infrastructure Transport Task Force ...... 22 3.3.5 Sustainable Transport Programme ...... 22 3.4 Housing ...... 23 3.4.1 Current housing market ...... 23 3.4.2 Housing growth and demand ...... 23 3.4.3 Housing delivery ...... 24 3.4.4 Specialist housing ...... 25 3.5 Land and assets ...... 26 3.4.1 Council owned land and assets ...... 26 3.4.2 One Public Estate ...... 26 3.6 Financial strategy and funding sources ...... 27 3.6.1 Summary of financial pressures ...... 27 3.6.2 Revised Medium Term Financial Strategy 2017/18 – 2020/2021 ...... 28 3.6.3 Access to central government funding ...... 29

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C - 10 4 OPPORTUNITY AREAS ...... 30 4.1 Newport ...... 30 4.1.1 Introduction to the Newport Opportunity Area ...... 30 4.1.2 Opportunities and constraints ...... 30 4.1.3 Vision for the Newport area ...... 32 4.1.4 Recommended regeneration strategy for Newport ...... 32 4.1.5 Strategic development sites ...... 33 4.2 Ryde ...... 37 4.2.1 Introduction to the Ryde Opportunity Area ...... 37 4.2.2 Opportunities and constraints ...... 37 4.2.3 Vision for the Ryde area ...... 39 4.2.4 Recommended regeneration strategy for Ryde ...... 39 4.2.5 Strategic development sites ...... 41 4.3 The Bay ...... 44 4.3.1 Introduction to The Bay Opportunity Area ...... 44 4.3.2 Opportunities and constraints ...... 45 4.3.3 Vision for The Bay area ...... 46 4.3.4 Recommended regeneration strategy for The Bay ...... 46 4.3.5 Strategic development sites ...... 47 5 SETTING UP THE REGENERATION PROGRAMME ...... 50 5.1 Intelligent client function ...... 50 5.1.1 Partnership and stakeholder management ...... 51 5.1.2 Compelling vision and consensus ...... 52 5.1.3 Guiding principles ...... 52 5.1.4 Creating value through design and product development ...... 53 5.1.5 ‘Great Estates’ long-term approach to asset management ...... 53 5.1.6 Brand ...... 54 5.1.7 Define the value each project will bring at an early stage ...... 54 5.2 Project controls (contract management, cost, time, risk) ...... 55 5.2.1 Evidence-based approach ...... 55 5.2.2 Programme Management Office with a relentless focus on the progression of projects . 55 5.2.3 Developing Business Cases ...... 56 6 REGENERATION PROGRAMME RESOURCE AND ACTION PLAN ...... 58 6.1 Next stage action plan ...... 58 6.1.1 Secure the mandate and evolve governance arrangements ...... 58 6.1.2 Set up the programme ...... 59 6.1.3 Initiate priority strategic projects ...... 59

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C - 11 Executive summary

In August 2016 Isle of Wight Council (IWC), with support from the Local Government Association (LGA), commissioned Inner Circle Consulting (ICC) to help establish an ambitious Regeneration Programme for the Island, focusing on the three key opportunity areas of Newport, Ryde and The Bay.

During an initial eight-week commission, ICC has:

● set up a Programme Management Office (PMO) with associated systems, documentation, templates, governance, a financial forecasting model and other infrastructure in anticipation of the recruitment of a Regeneration Director and team; ● conducted a data-dive exercise to understand the Island’s context, opportunities and constraints; ● reviewed and mapped approximately 25 potential regeneration sites in three opportunity areas; ● created a model to forecast the financial impact of development on these sites; ● evaluated the impact and deliverability of all sites, generating a shortlist of 11 priority projects (plus a number of potential enabling/linked projects) for inclusion in the first wave of the Regeneration Programme; ● established a likely funding / investment route for each project, including projects that can be submitted for LEP investment; ● undertaken a gap analysis for each priority project and the programme, including an analysis of the likely project delivery resource requirements; ● established an indicative costed schedule of activities to develop the priority projects to Outline Business Case and/or submission for LEP funding bids (where appropriate); and ● supported IWC and its partners with the submission of a One Public Estate expression of interest to central government.

The data dive revealed that the Isle of Wight has unique characteristics and strengths. With the right strategy and resources, the Island’s outstanding natural environment, heritage assets and strong marine and materials engineering industry could all be leveraged to attract inward investment, increase value and generate growth.

However, the data-dive exercise also revealed that the Island has a number of barriers to achieving growth. These are related in part to the ‘Island factors’ of separation from

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C - 12 the mainland and high cost of delivering services, but also a sustained lack of investment in its tourist offer, issues with the transport infrastructure and reduced economic activity resulting from the ageing demographic and a working-age population reliant on low-skilled, seasonal employment. Also of concern from a commercial investor perspective is the political instability and recent planning refusals for major inward investment projects. The Isle of Wight must understand these barriers and put in place measures to address them in order to harness the unique opportunities to deliver transformative regeneration and realise the value and benefits that come with growth.

The lack of market investment means that the Isle of Wight Council (IWC) must lead this regeneration activity with public and private sector stakeholders. In recent years the Council has focussed too much on its duty to reduce public spending. The Council now recognises that intelligent use of its land and assets offers an opportunity to drive growth to ensure the long-term sustainability of Council services and the economic prosperity of the Island.

Eleven priority projects have been identified in the three opportunity areas, which focus on growth aligned to Council and community aspirations for the places and build on the opportunity areas’ existing identities and strengths. In Newport there should be a focus on growth of employment space for high-tech industry and housing growth linked to new employment, as well as enhancements to the harbour to link in with the established industrial uses. From Cowes to Newport, the Medina Valley should be seen as a prime location to set up advanced manufacturing or high-tech marine business and attract further inward investment.

In Ryde and The Bay, the focus should be primarily on improving the tourist and leisure offer to enhance the experience for residents and visitors and diversify the nature of the visitor market. Encouraging a shift in the tourist offer towards higher- quality, ‘boutique’ accommodation and facilities will lead to longer-term value generation in these areas. In addition, the interchange and seafront facilities at Ryde must be transformed to create a fitting gateway to the Island. Better tourist experience should go hand in hand with a shift in the perception of those making fresh life choices as to what the Isle of Wight offers as a place to start a business or bring up a family.

In order to kick start a successful regeneration programme for the Isle of Wight, the 11 priority projects identified during this scoping stage must be adequately resourced and managed effectively at both a project and programme level. It is important that the Council takes an evidence-based approach to the use of its remaining land and assets

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C - 13 to identify opportunities for further efficiencies (including through the colocation of services with other public sector organisations) or increased revenue. Any successful regeneration programme also needs a compelling vision and consistent leadership, with a determination and focus on delivering that vision through ongoing partnership working. The Council needs to be able to think entrepreneurially.

The following recommendations are considered essential for the delivery of a successful Regeneration Programme for the Isle of Wight:

1. Develop a partnership approach to programme delivery and stakeholder management. 2. Continue to develop a vision and 20-year growth plan for the Isle of Wight in partnership with all stakeholders on the Island and in the wider Solent conurbation. 3. Develop a set of principles that all can sign up to which will govern the behaviour of all of those involved. 4. Adopt a ‘Great Estates’ approach to managing your real estate portfolio by retaining assets, strategically investing to create the most value and maximising your long-term return on investment. 5. Ensure each priority project has a clear value set that it is aiming to achieve from the outset, and that these values (or benefits) are making a measurable contribution to the Island Vision. 6. Commit to an evidence-based approach to decision-making and ensure sufficient resources are made available for data gathering and analysis. 7. Adopt a consistent method of project progression, change control and investment decision-making. 8. Establish a strong Programme Management Office with an appropriate blend of skills, experience and tenacity to design, develop and implement the regeneration projects. 9. Ensure all investment decisions are underpinned by a sound business case. Develop all business cases commensurate with the Treasury Five Cases model (Greenbook) taking them through an incremental process of development from Strategic Outline Case, Outline Business Case to Full Business Case.

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C - 14 The immediate next steps identified in order to set up the programme are as follows:

1. Initiate projects by identifying project leads, establishing budgets, agreeing the scope, objectives and programme. Consider prioritising certain projects to meet LEP bidding deadlines. 2. Appoint an experienced programme manager to procure programme-level expertise, establish a programme delivery team (including internal IWC resources), together with all relevant processes. 3. Secure a clear mandate for the Regeneration Strategy and Programme from Members and establish suitable governance arrangements. This will include a Regeneration Programme Board, and delegated authority to the Leader and/or Lead Member for subsequent decisions relating to the programme, in order to ensure timely decision-making.

By following the steps outlined above and throughout this report, we have estimated that the Regeneration Programme could deliver a total of 12,000 new jobs, 1,700 new homes and an increase in revenue income for Isle of Wight Council in the order of £15 million per annum over the period 2018–2027.

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C - 15 1 SCOPE

1.1 Document purpose

This document sets out ICC’s findings and recommendations for the Council following its initial eight-week commission from August to October 2016. This report will be used by IWC as a basis for progressing focussed regeneration activity prior to the appointment of a dedicated regeneration resource in early 2017 and possibly, beyond.

1.2 Structure of the document

This document begins with the findings of ICC’s data-dive exercise: a summary of the Island’s unique context, opportunities and constraints. It goes on to provide details of the 11 strategic projects identified within the three opportunity areas of Newport, Ryde and The Bay, following evaluation of approximately 25 potential regeneration sites in those areas. The report concludes by recommending next steps for progressing each of these strategic sites over the next three to six months, as well as highlighting a number of cross-cutting projects and programme-level activity essential in driving forward a successful Regeneration Programme for the Island.

1.3 Scope

ICC’s scope for this initial stage of the programme was to:

● Establish a Programme Management Office (PMO) to provide momentum, operational programme management, strategic leadership and robust administrative infrastructure across all regeneration activity. ● Identify strategic development projects within each opportunity area, particularly those that could be ‘bid-ready’ by March 2017 in order to secure funding from the Solent LEP and other government funding sources. ● Undertake a gap and capacity analysis to identify additional information and resources required to deliver growth from the prioritised strategic sites. ● Develop a work programme and costed resource plan for the next stages of the programme (to March 2017).

Reviewing regeneration activity and potential development sites in areas beyond Newport, Ryde and The Bay were outside of the scope of this commission, as was the

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C - 16 development of any detailed communications and stakeholder engagement strategy, which is currently being led by IWC.

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C - 17 2 STRATEGIC CONTEXT

2.1 Isle of Wight today

The Isle of Wight is located off the south coast of England and is the second most populous island with 139,400 inhabitants. It is considered part of the south coast conurbation including Portsmouth and Southampton, and as such forms part of the Solent Local Enterprise Partnership (LEP). The Island has over 70 miles of uninterrupted coastline and half of the Island is an area of outstanding natural beauty (AONB). The Island has a maritime and industrial tradition including boat building, sail making, the manufacture of flying boats, the world's first hovercraft, and the testing and development of Britain's space rockets.

Separated by the Solent from the mainland, the public transport links to the mainland are to and from Southsea (Portsmouth) by hovercraft, and via five ferry shuttle services across the Solent from Southampton, Lymington and Portsmouth.

Ryde, the island's largest town with a population of approximately 30,000, is in the northeast of the Island. It is a Victorian town with the oldest seaside pier in England.

Newport, in the centre of the island, is the county town of the Isle of Wight and the Island's main shopping area. Located next to the River Medina, Newport Quay was a busy port until the mid-19th century.

The Bay area includes Sandown and Shanklin; popular seaside resorts with high summer sunshine levels and sandy beaches.

Cowes is located on the estuary of the River Medina. It is the home of the record- setting sailor Dame Ellen MacArthur. East Cowes is famous for Osborne House and as the home of Saunders-Roe; the historic aircraft, flying boat, rocket and hovercraft company. The company has left a legacy of innovation in the marine and aeronautical industries.

The Isle of Wight needs growth and investment to address the long-term sustainability of public services and the future economic prosperity of the Island. Whilst the Island has long been one of the UK’s most popular holiday destinations, this comes with a series of issues including over-reliance on seasonal, low paid jobs and a brain-drain of young educated people. Due in part to its popularity as a retirement location, the

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C - 18 population of the Island shows an ageing demographic profile with significant levels of chronic disease. This places additional demand and therefore costs on local public services.

Whilst being an Island makes for a unique geography and beautiful environment, the cost of transport is higher than reaching other parts of the UK and therefore the Island is often overlooked when it comes to inward investment. The lack of inward investment means growth in the tax base and private wealth does not keep up with the cost of public service provision. However, there are many unique assets (many land assets are publically owned) and opportunities on the Isle of Wight, which if correctly leveraged, will help transform the economy of the Island and in doing so, transform the health and wellbeing of those living, working and visiting.

IWC is fundamentally rethinking and reshaping the way it approaches public service provision and sustainable economic growth. Central to this is an acknowledgment that the Council must make better use of it assets: they can provide space to co-locate services for greater coordination; they can be modernised to ensure ease of customer access and quality of service provision. Surplus assets can be used to create commercial return either through sale or generation of revenue streams that can be reinvested in public services.

2.2 Global and UK trends affecting the Isle of Wight

There are a number of global macro trends that will play a prominent role in shaping the future operating environment for businesses, governments, and citizens. Some of these that need to be considered when designing a regeneration programme for the Isle of Wight include the following:

● Geopolitical instability is increasing. Europe continues to grapple with internal political challenges, violent extremism, and the migrant crisis. ● Climate change means extreme weather events become more frequent, the economic costs of climate change continue to grow. ● Cities and city-regions will continue to act as centres of gravity for people and business clustering. ● The IT revolution continues. Emerging technologies will blur the line between real and virtual life and lead to growing personalisation of consumer goods and retail experiences. Big data, predictive analytics and machine learning will increase the level of personalisation in services.

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C - 19 ● The increasing technological sophistication and expanding presence of smart devices, unmanned systems, and robots will reshape cities, businesses and households. This includes the rise of Smart Cities aimed at generating efficiencies (such as transport mobility, waste management etc.), increasing digital connectivity and transparency. ● As consumers, we now have more choices than ever before. In a world of overwhelming possibilities, simplicity is making a comeback. However, consumer expectations remain high of any service; public or private. ● People will continue to take health care back into their own hands through greater knowledge and readily available applications.

In the UK there are several trends that create opportunities and barriers to growth on the Isle of Wight, including:

● The UK choosing to leave Europe will result in economic instability and affect inward investment decisions, but it will create new opportunities in the global marketplace. ● Growing inequality of earnings is a social and political problem that needs to be addressed. ● The constraints in public spending enhance the need to achieve private sector growth across the country. It is the proceeds of growth – individual and national – that can increase our standard of living to the levels to which we aspire.

These UK trends reinforce the need for transformational change in the way public authorities think about their role, the sustainability of their finances, how they use their assets and how they work collaboratively to harness the full power and resources for the benefit of their area.

2.3 Coastal town issues in the UK

The Isle of Wight is not alone in the challenges it faces. The relatively recent coastal town commission and associated research has identified a number of key characteristics in coastal towns which are present in the Isle of Wight:

● By definition coastal towns are often not well connected in so far as they are the ‘end of the line’. However, connectivity is a vitally important ingredient in successful regeneration. ● Coastal towns often have a two-tier housing market (low value social rented homes and high value holiday homes).

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C - 20 ● Their economies are heavily reliant on tourism – but in the UK the market is largely limited to UK consumers and is seasonal. ● Often vulnerable adults with multiple public service needs i.e. elderly and disabled people are disproportionately represented. ● It is often hard to get things done because of a plethora of competing interest groups.

Successful regeneration in coastal towns (and other towns) more often than not includes the following factors:

● The prospect of improved connectivity ● Inspiration from investments or small change projects ● A sense that things can be achieved among the local community and those looking to ‘invest’ ● Civic leadership ● A strong cultural offer

2.4 UK policy affecting development finance

Over recent years the Government has put in place successive policies to reduce mainstream grant and link local government finance to the stimulation of local housing and economic growth. The Isle of Wight is already aware of the following policy incentives:

2.4.1. Business rate retention

The proposals focus on devolving 100% of business rates retention to local councils by 2020. This is a move towards self-sufficiency and away from dependence on central government, accompanied by a shift towards greater local accountability over funding and the way devolved responsibilities are delivered. There will continue to be a level of redistribution between authorities similar to the current system of tariffs and top-ups, as well as protection to insulate authorities from shocks or significant reductions in their income. The outcomes of the Fair Funding Review will establish the funding baselines for the introduction of 100% business rates retention.

Councils will also have new powers to shape the operation of the business rates in their area, with additional flexibilities around the operation of the multiplier. The new powers that central government is proposing are:

● the ability to reduce the business rates tax rate (the multiplier); and

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C - 21 ● the ability for Combined Authority Mayors to levy a supplement on business rates to fund new infrastructure projects, provided they have the support of the business community through the Local Enterprise Partnership.

This fiscal devolution will place greater responsibility on councils to generate their own revenue and provide communities with the financial independence, stability and incentives to push for local growth.

2.4.2. New Homes Bonus

The Government’s proposed changes to the New Homes Bonus seek to better reflect authorities’ delivery of new housing and reduce the number of years in which current and future payments are made. The Government wishes to consider how the incentive element of the Bonus could also be tightened alongside possible changes to respond to the move towards full retention of business rates and the potential for further devolution of powers and responsibilities to local authorities. The changes include: ● withholding new Bonus allocations in areas where no Local Plan has been produced; ● reducing payments for homes built on appeal; and ● only making payments for delivery above a baseline representing deadweight.

2.4.3 Devolution packages

The Cities and Local Government Devolution Act 2016 provides a framework through which combined authorities are able to negotiate devolution packages with central government. The Solent authorities of Isle of Wight Council, Portsmouth City Council and Southampton City Council, together with the Solent LEP are currently negotiating a deal with government to establish a Solent Mayoral Combined Authority. This deal would give the region £900 million over the next 30 years (including £30m per year in new funding) to improve infrastructure, transport and housing, and provide training and skills and support for business.

The deal would also involve the devolution of significant decision-making powers from central government; bringing decision making and accountability closer to local people; enabling funds to be spent on tackling local problems; and taking advantage of local opportunities to improve economic growth.

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C - 22 3 ISLAND AND COUNCIL CONTEXT: FOUNDATION FOR GROWTH

3.1 The case for change: IoW Corporate Strategy and resources

Over many years, and at least from the date of its formation, IWC has been extremely effective at removing costs from the organisation to successfully meet its financial challenges. This has allowed the Council to set lawful and balanced budgets but has required significant reductions in services over time. These reductions have been achieved in the context of the ‘Island factors’, which add costs to the delivery of services on the Island arising from its segregation from the mainland. However, whereas cuts are finite, value creation is unlimited.

The Council has arguably cut further and deeper than its comparators in almost every area of service. And by denying itself the capacity, skills and knowledge necessary to develop schemes and bids that could bring financial growth to the Island, the Council has been unable to tackle the other side of the funding equation: growth.

We fully support IWC’s recognition that only through proactive and effective regeneration activity at scale can it attract inward investment and the development of new homes and businesses on the Island, thereby growing the council tax base to ensure long-term self-sufficiency.

3.2 Economic Development

3.2.1 Economic performance

The economic indicators from 2015 which were analysed as part of the Economic Development Plan 2016/17–2018/19 show that the Island’s economy remains fragile, with a weaker economic performance in relation to the South East (SE) region and national averages in terms of:

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C - 23 ● employment rate; ● average wages; ● annual GVA growth; ● business birth rate; ● productivity; and ● people with higher level qualifications.

The Isle of Wight economy is constrained by its island location and a lack of major infrastructure connecting it to the mainland. This leads to a high degree of self- containment in its job and labour market, which remains heavily reliant on tourism and creates a seasonal imbalance of employment and economic activity. Economic activity is also restricted by the Island’s ageing population and large numbers of retired people.

However, the Isle of Wight has a number of distinct economic strengths, including a strong, modern manufacturing sector in comparison with the SE region, as a result of companies and local supply chains in marine industries, aerospace, and composite material production; plus a healthy level of self-employment and micro-businesses, many of which are attracted by the quality of place offered by the Island. These, allied to the visitor economy and tourist offer, provide the opportunity for growth.

3.2.2 Tourism, industry, construction and commercial investment market

Tourism is one of the Island’s most important sectors, and growing the visitor economy has been identified as a corporate priority. However, there has been a structural shift in how people take their holidays over the last 30 years, which has resulted in a gradual decline in the total number of visitors and a change in the demographics of visitors, their length of stay and the time of year they visit. In addition, the average spend per visitor is low and there remains significant seasonal variation in the number of visitors.

The Isle of Wight Destination Management Plan produced by Visit Isle of Wight in 2015 states how the visitor economy is to be developed, and includes four key objectives to:

1. increase the value of tourism, by increasing the numbers of visitors (particularly those staying overnight) and by increasing the spend per visitor. 2. encourage innovation and industry investments, through offering accommodation ‘products’ and services which reflect changing demands. This includes both attracting new providers and preparing existing businesses for change (which may be challenging for long-established businesses).

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C - 24 3. develop a year-round tourist economy, which means providing a year-round offer with a wider demographic appeal than those who would traditionally visit in the summer / school holiday peak times. 4. sustain and enhance the Island’s landscape, through the protection and enhancement of its natural assets, plus ‘placemaking’ investment to improve the quality of place in towns and villages, the public realms and transport, movement and connectivity.

Visit Isle of Wight has established a Business Improvement District (BID) funded by a levy and will agree a five-year plan for spending the levy in order to deliver this plan.

In terms of industry, the Isle of Wight has a strong, modern manufacturing base with particular strengths in a number of sectors, including aerospace, renewable energy, composite materials, marine and defence electronics. The Island benefits from the presence of a number of companies of international recognition (e.g. BAE Systems, GKN Aerospace) which have strong local supply networks, made up mainly of SMEs.

The Employment Land Study (2015) indicates that the market for employment space is relatively small, mainly caters for the local market and is largely self-contained to the Island. The main sources of demand are for industrial commercial property from advanced manufacturing (especially in Newport), plus more ‘local’ industries such as mechanics, storage and distribution. There is stronger demand for space with direct waterfront access (a typology of employment space not available in competing areas) and smaller, low cost office space. However, there has been a lack of speculative development of new employment space because rental values make development unviable. The exception to this is in Newport (where rents are higher) and elsewhere on the Island where there is a proactive public sector role to unlock or de-risk development.

The office market is generally localised and small-scale. It is particularly focused on Newport and the needs of SMEs, with the majority of the demand coming from local firms wishing to expand. A high percentage of the stock is secondhand and poor quality. Like industrial space, new build development is unviable due to the rents that can be achieved. The Employment Land Study suggests that the forecast need for employment land can be met through the existing allocations in the Core Strategy but that there is a misalignment in locations, with an oversupply in Newport and undersupply in Ryde.

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C - 25 Developing strategic sectors and clusters of marine, aerospace, defence, advanced manufacturing, engineering and low carbon businesses is vital to economic growth on the Isle of Wight. Growth also requires action to stimulate and nurture an entrepreneurial culture on the Island, with business support products for key strategic sectors.

3.2.3 Education, employment and skills

The island has a significant skills deficit with a less qualified population in terms of higher-level qualifications when compared to the mainland. However, this gap is closing, with the proportion of the population achieving a Level 4 qualification each year increasing at a faster rate than the regional and national averages. Although GCSE attainment has increased over the last three years, the proportion of students achieving five GCSEs or above is lower than that of the SE region and the UK. Furthermore, fewer students go on to enter higher education when compared to those in the SE region or nationally.

Enhancing skills levels and improving educational attainment is necessary to provide an appropriately skilled workforce to both attract higher-value inward investment and ensure existing businesses remain competitive. Many industries and occupations face the combined effects of higher skill needs and an ageing workforce. A key objective of relevant stakeholders is therefore to develop a workforce with the qualifications and skills which meet the demand from strategically important sectors, such as advanced manufacturing and engineering, marine industries and renewables. In addition, organisations such as the Isle of Wight Destination BID will be working with existing businesses in the visitor sector to develop appropriate skills for the development and growth of the visitor sector into new markets.

An important part of the business support strategy is to establish stronger university links with the Island, including R&D facilities and possibly a higher education presence. The aim is to stimulate local businesses and help provide a higher-level skills base for potential incoming firms. The LEP is to work with nearby universities and research centres to create a world-class research facility that can enhance development and expertise in key sectors, such as renewable energies.

A key project which demonstrates a number of these themes is the Isle of Wight College’s Centre for Excellence for Composites and Advanced Manufacturing, which is to be located on the Island Technology Park in East Cowes. This is being led by GKN Aerospace and is due for completion in 2017/18.

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C - 26 3.3 Transport and Infrastructure

3.3.1 Island connectivity

The Isle of Wight is connected to the Solent mainland by six passenger services and three ferry car services: from Lymington to Yarmouth (Wightlink); Southampton to East and West Cowes (Red Funnel, Red Jet); Portsmouth to Fishbourne (Wightlink) and Ryde (FastCat); and from Southsea to Ryde (Hovertravel).

The Island has 489 miles of roadway and 520 miles of public rights of way, including an extensive network of byways, bridleways, footpaths and cycle tracks. The lighter traffic, quieter roads and slower speeds are one of the reasons the Isle of Wight has remained attractive to tourists from the busier mainland.

Internal connections by public transport rely significantly on bus services. Southern Vectis have maintained a monopoly on bus transport on the Island, with the most regular services running between the larger towns such as Ryde and Cowes. There are three bus stations on the Island, located at Newport, Ryde and Yarmouth respectively and one Park and Ride site at Cowes.

In the 1950s and 1960s the Island boasted a comprehensive railway network connecting Ryde, Newport, Cowes, Sandown and Ventnor. Today much of the old rail network has been converted to cycle ways, with the main remaining railway line – the Island Line – running from Ryde Pier Head to Shanklin. Services are provided by Island Line Trains, using former London Underground rolling stock. The Island also has a steam-operated heritage railway, the Isle of Wight Steam Railway, which used to be part of the former Ryde to Newport line. Today, the steam railway connects with the Island Line at Smallbrook Junction and runs up to Wootton.

The Island also has two small airfields for general aviation: Isle of Wight Airport at Sandown and Bembridge Airport. These are busy with day-trippers in the summer. Flights going from the Island to London have also been trialled, however these proved unpopular and so were discontinued.

3.3.2 The implications of growth on infrastructure

Based on an analysis of past and recent trends, there is an ongoing growth of population and increase in number of internal journeys in several districts within the Solent, including the Isle of Wight, which are expected to increasingly affect the

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C - 27 economic performance of the transport network (source: Solent Strategic Transport Investment Plan, May 2016).

Over the period 1981–2014 the Isle of Wight population has increased by 18%; an equivalent of 600 people per year (source: ONS, AECOM analysis). In 2011, 86% of people residing in one of the Solent’s twelve constituent districts also had their workplace in one of these districts, showing a high level of employment self- containment within the Solent area. Evidence from the 2001 and 2011 Census suggests that there are high levels of internal movement for work and other journey purposes, contributing to traffic issues on the local and strategic networks in most of the Solent’s districts, including the Isle of Wight. The Island’s vehicle traffic also emanates from the mainland, comprising mostly tourists and therefore peaks in the summer when the island’s population almost doubles.

3.3.3 Issues and opportunities for improvement

Local traffic issues and support for active modes schemes form a key part of the local transport initiative for the Isle of Wight. There is a need for transport schemes that will unlock housing, economic growth and regeneration, modernise the current services and tackle the existing issues. The main transport issues and relevant schemes and opportunities are as follows:

● Connectivity between the Isle of Wight and the mainland relies significantly on ferry services. These services can be costly and there is space for improvement of the quality of travel experience they offer. The case for an Isle of Wight fixed link bridge or tunnel is weak due to the very high cost (unjustified on the basis of current and future activity and development prospects), alignment feasibility and environmental constraints, as well as resistance by both Island residents and tourists. A proposal in 2008 for a new tramway linking Ryde to Gosport, connecting with existing rail networks on both sides, was met with more support from Island residents. The plans would also include a new harbour at Ryde, with berthing facilities for more ferries and container ships. However, this proposal has not been taken forward. ● There is space for improvement of the cross-Solent connections through better interchanges. The Ryde Interchange from ferry to rail services is poor due to badly integrated ticketing services and outdated facilities. Pedestrian connectivity and wayfinding in Ryde are also poor, especially between the Interchange and the town centre, while Ryde’s bus station is inadequate due to lack of space for buses to circulate efficiently. A 2006 proposal to redesign the

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C - 28 Interchange facilities and surrounding esplanade area, was not taken forward. Better integration of modes between ferries and other public transport offers potential to have an impact on the economy, as well as to support the increased use of public transport. ● There is a general increase of localised congestion and barriers to movement on the Island. There is significant traffic congestion in and around Newport, especially at peak times. Newport Highway Improvements are needed by 2020 to accommodate predicted growth and unlock new development at Coppins Bridge gyratory, St Mary’s roundabout, Medina Way and Hunnyhill / Hunnycross & Riverway junction. Due to forecast increased journey times, the floating bridge in East Cowes is also scheduled to be replaced. As per the recent Solent Strategic Transport Investment Plan (May 2016), there is an opportunity to develop priority measures and sections of busway which would offer ‘Bus Rapid Transit (BRT) Lite’ links between Ryde, Newport and Cowes, as part of an integrated transit network via ferry connections to the rest of the Solent area and beyond. Studies and delivery plans for infrastructure improvements in Newport, as well as potential improvements in Ryde and The Bay, have recently been commissioned by the Council. The Council is aiming for this work to be used as the basis for an Infrastructure Delivery Plan to be developed by late 2017. ● There is need for capital investment in the 1960s Island Line train, electricity supply, pier and track. The line provides important services for passengers, but currently runs at a financial loss and requires significant investment for upgrades to maintain the integrity of the infrastructure and rolling stock. The operational future of the Island Line rail service is also uncertain. The Island Line forms part of the South Western Franchise, but operates under a separate lease agreement with Network Rail. Responsibility for infrastructure maintenance and renewals is shared between the operator and Network Rail under this lease, which is due to expire in 2019. In approaching the re-letting of the South Western franchise, a key objective is to secure an appropriate, financially sustainable long term future for the Island Line. ● Internal public transport connections rely significantly on bus services, with larger towns such as Newport using buses as the only means of public transport to connect with the rest of the Island. The Southern Vectis monopoly and the fact that they are not subsidised make buses a costly way to travel. Alternative, cheaper and more flexible transport modes, that exploit the Island’s electricity surplus and manufacturing industry, such as electric bikes and hire

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C - 29 cars, might contribute to a greater variety of options for residents and visitors, enhance the quality of travel and generate economic profits.

Case Studies: An electric car sharing scheme was launched in February 2016 and aims to put nearly 3,000 electric cars on the streets of London by 2019. The Bluecity service will emulate the ‘Boris Bike’ system. Source: www.ft.com (link)

Toyota is planning to implement an electric mini-car sharing system in different cities around the world, and has been testing the system in Grenoble since October 2014, The system is expected to expand to other cities and regions from 2016. Source image: ecomento.com (link)

Bus Rapid Transit (BRT) has proven to be an affordable, sustainable, and highly effective solution. A wide range of electric and hybrid BRT systems can be found in the market. Images: Birmingham is looking at Barcelona to implement a similar BRT system. Source: birminghampost.co.uk

3.3.4 The Solent Strategic Transport Investment Plan In 2014, as part of the process to agree the Solent ’s Local Growth Deal with central government, the Solent Local Enterprise Partnership (LEP) produced a Strategic Economic Plan (SEP) to outline a transformative vision for the future growth of the local economy. Central to this vision is the need for a modern and resilient transport network that can enable the region to fulfil its economic potential by providing the conditions that enable businesses and people to thrive and productivity to increase. Therefore, the LEP has worked in partnership with AECOM to produce a Strategic Transport Investment Plan (May 2016) for the next 25 years.

The key recommendation of the Investment Plan is for the Solent to focus on the development of an integrated and expanded public transport network - Solent Transit

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C - 30 – covering new and existing bus, rapid bus, ferries, park and ride and rail/light rail modes across the increasingly integrated area. This will allow improved connectivity and accessibility across the Solent, link communities and opportunities and support sustainable economic growth. The component parts would complement existing or modified strategic rail services and passenger ferries to and from the Isle of Wight, including a potential extended rapid bus on the Island, with integration and interchange as a key objective.

3.3.5 Infrastructure Transport Task Force

The Infrastructure Transport Task Force is a transport working group that comprises senior representatives from the Department for Transport, Isle of Wight Council, Solent LEP, Isle of Wight Chamber of Commerce and Tourism and from various business stakeholders.

The Task Force’s main role is to assist the Council in preparing an integrated Island- wide Transport Infrastructure and Services Development Plan, in accordance with the Strategic Transport Investment Plan and aligned with the Island’s vision and objectives: delivering a multi modal transport system for the Isle of Wight that is safe, secure, accessible and affordable; and which promotes economic development and underpins the social, and environmental wellbeing of the Island community. The Transport Infrastructure Plan is currently being tendered for infrastructure delivery projects, to bid for Growth Fund Phase 3.

3.3.5 Sustainable Transport Programme

The Isle of Wight Council is one of only 18 local authorities to secure three consecutive rounds of DfT sustainable transport funding since 2012, and (at the time of drafting) is currently awaiting the outcome of its bid to the next round of DfT funding – the Access Fund – which, if successful, will secure £1.35m revenue funding for the next three financial years. Thus far the programme has generated a range of successful sustainable transport capital projects from Car Clubs to ‘smart’ cycle routes.

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C - 31 3.4 Housing

3.4.1 Current housing market

As of 2011 it is estimated that there are 61,111 households living on the Isle of Wight, of which an estimated 11% are living within the affordable sector and 89% in the market sector.

When comparing entry-level house prices to local incomes, housing affordability is better on the Isle of Wight than many parts of the SE region. However, there is evidence that younger households working locally have found it difficult to get on the housing ladder; during the decade 2001–2011 the number of households living in private rented accommodation increased by around 63%. There is also understood to be wide variation in house prices between sub-market areas on the Island, for example between affluent rural areas such as Bembridge and Seaview, and less affluent urban areas such as Newport and Ryde.

The Council’s policy position is that it expects new housing developments (of 15+ units in Key Regeneration Areas and 10+ elsewhere) to provide 35% of the development as on-site affordable housing. Financial contributions towards affordable housing are sought from smaller developments, with an overall target tenure mix of 70% affordable/social rented and 30% intermediate within affordable housing developments.

3.4.2 Housing growth and demand

It is important to understand that housing markets are influenced by macroeconomic factors, as well as the housing market conditions at a regional and local level. However, demographic changes are expected to be a key long-term driver of change on the Isle of Wight, particularly in light of the changing age structure of the Island’s population. With population growth there is expected to be a significant ageing of the population; particularly the population aged 85+, which is projected to increase by 139% during the period 2011–2036. These demographic changes will result in not only household growth but also a change in household types, with virtually all (95%) of the growth being accounted for by one person households.

The Council’s most recent Strategic Housing Market Assessment (SHMA) was completed in August 2014 and confirmed that affordable housing represents 58% of the overall housing requirement from 2011–2036. Projections suggest that during this period, around 76% of the affordable housing requirement will be for homes with one

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C - 32 or two-bedrooms and 24% for larger homes with three or more bedrooms. However, as a result of the local authority’s statutory duties towards homeless families with children, a weighting towards affordable housing with two or more bedrooms was applied in the SHMA.

In terms of market housing, the SHMA predicted relatively stronger demand for larger family homes over the short-term and a continuing market for family homes over the 25-year projection period. Existing stock is expected to make a significant contribution to meeting this demand as older households downsize and release larger family homes back onto the market.

The SHMA also identified a number of housing challenges for the Isle of Wight, namely:

● Balancing the fact that 58% of the overall housing requirement are households who require some form of affordable housing, when the Council is only planning for 35%. ● Household projections show that the Island is expected to see a substantial increase in the older population with the total number of people aged 55 and over expected to increase by 40% from 2011–2036. In particular, a large rise is projected in the number of people with dementia (123% increase) along with an 88% increase in the number of people with mobility problems. ● Analysis of younger person households shows a high reliance on rented housing. Younger age cohorts may therefore be forced into private rented (including shared) housing as the only means of meeting their housing needs, aside from residing with parents.

3.4.3 Housing delivery

The Council does not own its own housing stock therefore the affordable housing is owned and managed by the main housing associations operating on the Island: Southern Housing Group, Spectrum and Vectis. The private residential developer market on the Island is limited, with Barratt Homes being the only major housebuilder currently developing market housing at scale. However, recent Barratts developments have been sensitive to market conditions and arguably do not offer the design quality expected by the Council.

The 2014 SHMA identified a need to deliver 589 additional homes per annum to 2036 in order to meet objectively-assessed needs. This includes a net requirement for 304 affordable homes per year over the plan period to enable households in need of affordable housing to access an affordable home. To date delivery has fallen slightly

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C - 33 behind this target, although there is capacity to develop more homes on the Island, predominantly in the Medina Valley and Ryde.

The market for self and custom-build housing on the Island could be developed to appeal to young families seeking more innovative solutions to owning their own home, particularly those attracted by the quality of place and new employment opportunities on the island. Overall, the development of different market housing typologies should be linked to the Island’s economic development plan and appeal to those skilled young people who are likely to be attracted to live and work on the Island as a result of a focus on the primary sectors, particularly high-tech industry.

3.4.4 Specialist housing

Due to the high proportion of older people on the island and the ageing demographic profile, together with the known oversupply of residential care homes and undersupply of extra care housing, there is a pressing need for the Council to consider how it can facilitate the delivery of specialist housing for older people. Doing so will help reduce revenue costs for social services while also releasing under-occupied family homes in the affordable and market sectors. This is a huge opportunity for the Council and could lead to double bottom line improvements: income and revenue savings.

An extra care housing strategy is currently in development by IWC and targeted for approval during December 2016. Given that in 2001 approximately 80% of older people on the Island were living in a home they owned, this strategy must consider how the Council can facilitate the development of extra care housing for private sale/rent and shared ownership, in addition to social rented provision. It should also explore opportunities for further integration of health and social care services through the provision of collocated extra care and step-down/rehabilitation facilities, in order to improve hospital discharge rates and prevent re-admissions to higher forms of care.

Although the initial focus of the extra care strategy will be on older people, the specialist housing needs of adults with learning disabilities should also be considered using a similar strategic market-shaping approach, together with direct delivery where necessary.

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C - 34 3.5 Land and assets

3.4.1 Council owned land and assets

The Council is a major landowner on the Island and has a current register of over 700 land and assets of varying size and type. Through a high-level review and mapping of the council-owned land and assets in the three opportunity areas, it is clear that the Council is in a strong position to use its land and assets to promote growth. However, it is also clear that this needs to be carried out using an evidence-based approach and through the development of a detailed asset management strategy as the starting point.

The basis for this strategy should be an assessment of the current costs, usage and value of the land/asset to create a baseline position and allow for comparison across the stock. Assets used for front-line or back office Council services should be reviewed in light of the Council’s customer access strategy and new ways of working to ensure space is being used efficiently and shared with public sector partners where possible. A more commercial focus on the use of land and assets, whether internally within the Council or through support from private sector partners, could help the Council realise further revenue savings and generate income.

3.4.2 One Public Estate

In July 2016 NHS Isle of Wight Clinical Commissioning Group (CCG) and Community Health Partnerships produced a Local Estates Strategy to reflect changes required to the local NHS estate in order to ensure it can provide a continued level of excellence in health service delivery, from a flexible estate that is adaptable to changing service models and can realise savings and efficiencies for the NHS.

This strategy reflects the commissioning direction of the Island’s My Life a Full Life (MLAFL) Programme which was established to fundamentally change and improve the lives of people on the Island through a five-year vision for integrated health and social care. Through smarter partnership working and integration with local authority and voluntary sector services, the programme aims to promote a person-centred approach which enables people to take control of their lives and plan for their future health and social care needs. The relocation of services from hospital sites to community settings is a key factor in driving change in the way services are accessed and reducing pressure on acute care.

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C - 35 The local estates strategy provides a broad overview of the changes required for the healthcare estate to ensure it is fit to meet future demands but also able to create efficiencies within the next few years. The priority ‘quick win’ projects identified in this strategy are the development of locality health and wellbeing hubs in Sandown (The Heights) and Newport (Pyle Street) and a rationalisation of the St Mary’s hospital estate in Newport. These projects will be taken forward through the recently established One Public Estate (OPE) Land and Assets Panel, led by IWC.

The aims of the panel are to identify further opportunities for the colocation of services which could realise revenue savings, join up and improve service provision and release surplus public land for disposal and/or development of housing and employment space. Another project to be progressed through the OPE route is the development of surplus Ministry of Justice (MoJ) land at HMP Isle of Wight, which is due to transfer to the Homes and Communities agency (HCA) imminently.

Although closer partnership working and the sharing of services and facilities has been attempted on the Island in the past, it is clear that the potential for joined-up public sector services has not been fully exploited. In order to successfully progress these OPE projects to benefit all partners and ensure truly joined-up service delivery, there must be a shared vision and agreed programme for each site. In addition, a programme of activity to explore further opportunities for sharing asset data and information should be progressed. It is hoped that an expression of interest recently submitted to central government seeking financial and non-financial support from the OPE Programme could mark the start of a maturing of relationships between public sector partners on the Isle of Wight in order to achieve these aims.

3.6 Financial strategy and funding sources

3.6.1 Summary of financial pressures The recent lack of inward investment set against the demographic change and changing consumer expectations means growth in the tax base and private wealth does not keep up with the cost of public service provision on the Isle of Wight. This is typical of the majority of local authorities.

Furthermore, Isle of Wight Council has arguably cut further and deeper than any of its comparator local authorities, with savings over the austerity period to date totalling approximately £63 million. This has left the Council operating at minimum reserves with a £4.5 million budget gap in the current year and further savings of approximately

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C - 36 £32 million still required between now and 2020/21. This means that a strategy to make savings of the necessary magnitude will need to include:

● identifying potential sources of additional income; ● further efficiency savings from the high spend departments i.e. Adult Social Care, Children’s Services and the Highways PFI; ● a Capital Programme targeted at ‘invest to save’ projects; and ● an improved funding base from Council Tax, Business Rates, New Homes Bonus and central government grant.

The financial pressures facing the Council are the biggest single threat to sustainable public services for the Island. The Council has therefore recognised that its resources (revenue, capital, assets and staff) must be intelligently deployed towards generating savings and increasing income, in order to secure the service provision.

3.6.2 Revised Medium Term Financial Strategy 2017/18 – 2020/2021

The Council has acknowledged that it requires a short-term fix before a longer-term strategy can take effect to address the underlying financial pressures faced. Short-term measures are expected to include:

● Improving efficiency and effectiveness through a forensic review of spend. ● Removing the lowest impact services. ● Using capital receipts for ‘invest to save’ schemes. ● Reducing debt-servicing costs. ● Increasing operational and financial capacity to transform. ● Engaging in more / better targeted entrepreneurial and commercial activities.

These measures will provide a short-term ‘fix’, while the longer-term strategy for sustainability of public services develops, which will involve:

● Public service transformation (reducing costs and improving performance). ● Reconfiguration, prevention and reducing demand for high cost services. ● Removing the lowest impact services. ● Improving the Island’s economy through an improved tax base and value generation. ● A strategic review of Council and public sector partner assets to support economic growth and increase the tax base. ● Demonstrating the case for ‘Fairer Funding’ to central government in order to increase the funding base.

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C - 37 The transformation and reconfiguration of services can only be carried out effectively by engaging with public and voluntary sector partners and town/parish councils, and through smart, evidence-based commissioning. A focus on commercial activities, targeted capital investment to rationalise the estate and release land for further development, and collaboration with partners/mainland local authorities are also recognised as essential to the long-term sustainability of services.

Revised capital and revenue budget setting arrangements are already being established within the Council in light of this revised Medium Term Financial Strategy.

3.6.3 Access to central government funding

As part of the Fairer Funding Review, the Council has been making the case to central government about the implications of the ‘Island factors’ on the cost of public service provision on the Island. It is hoped that evidence provided by the Council will be taken into account as part of the review, although this is not expected to have an impact on the funding settlement for several years.

Meanwhile there are other opportunities for the Council to access central government funding streams. These include the Local Growth Fund, whereby Local Enterprise Partnerships are invited to compete for a share of £1.8 billion to support projects in their areas that target economic growth (i.e. housing, jobs, skills and private sector leverage), the Coastal Communities Fund and the possible Solent Devolution Deal, which could involve new funding of £30m per year for the Isle of Wight Council and its partner authorities.

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C - 38 4 OPPORTUNITY AREAS

4.1 Newport

4.1.1 Introduction to the Newport Opportunity Area

Newport is the county town of the Isle of Wight and has a population of approximately 25,000 (source: 2011 Census). It is situated inland at the head of the navigable section of the River Medina, which flows from Newport quay northward to Cowes and the Solent. This historic town centres on two elegant squares of Georgian and Victorian architecture a short distance away from the town’s quay, which was a busy port until the mid-19th century.

As part of the Medina Valley and due to its wealth of sites with water access, Newport is a hotspot for employment activity on the Island, particularly in knowledge-driven and high-technology industries such as marine, renewables and composites. The town is also the main shopping centre and location for public services on the Island (including County Hall, St Mary’s Hospital and HMP Isle of Wight). As such, transport connections link all other major towns to Newport, converging at the Medina Way between Coppins Bridge and St Mary’s roundabouts. There is a large bus station in central Newport with regular bus services travelling in all directions across the Island, but no railway services connecting Newport to other towns following the closure of Newport railway station in the 1960s.

4.1.2 Opportunities and constraints

Natural environment: There is an extensive range of environmental designations within the Medina Valley in the area north of Newport, which include international and national designations as well as sites identified at the local level. The majority of these designations are associated, either directly or indirectly, with the river itself. Whilst the high quality of the natural environment is very much a positive asset, it also plays a significant role in shaping the location and type of development within the Medina Valley.

Employment: As traditional industries decline the area needs to adapt to meet the needs of modern businesses that are more compatible with other uses, such as residential. There is an identified need for small and medium sized employment units

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C - 39 in Newport, however rents for employment and office floorspace in the area are generally higher than elsewhere on the Island; as such there are affordability issues for businesses in some sectors. Worklessness is an issue within the area, which strengthens the case for promoting increased training and employment opportunities.

Housing: The core strategy sets out that around 960 new homes are expected in the Medina Valley area (including Cowes and East Cowes) by 2027. This area has historically been a focus for a mix of residential and employment uses, with a number of large urban extensions permitted and currently being built out. There are significant opportunities for further housing development in and around Newport; particularly on the land at HMP Isle of Wight, which has the potential to deliver up to 1,300 new homes, as well as a mix of commercial, community uses and open space to create a sustainable new community in the area. However, the potential market for this scale of new housing is unclear. It is important that housing typologies in Newport are linked with the Island’s Economic Development Strategy and that residential development is high-quality and appealing to people taking up employment opportunities in primary sector businesses located in the area.

Transport infrastructure: Due to the lack of railway infrastructure connecting Newport with the rest of the Island, there is a heavy-reliance on the road network in and around Newport. Traffic modelling has highlighted that the highways infrastructure (particularly Coppins Bridge gyratory and approaches, Medina Way and St Mary’s Roundabout) is operating at or near capacity. Significant improvements are therefore required to meet demand at peak times of the day and to sustain development in the area. The Council’s appointment of WYG to undertake detailed feasibility and delivery planning for these junction improvements will establish essential cost and programme information, which can be used by the Council as a basis for seeking planning contributions from developers and understanding the timescales for unlocking development sites in the area.

Tourism and leisure: Although Newport is not a primary tourist destination on the island, there are opportunities to improve its tourist and leisure offer, particularly in the Newport Quay area. Combining new tourist and leisure facilities with high-quality residential development by the harbour would enhance the public use and visual amenity of the area. The harbour revision order currently being progressed by IWC will facilitate this, although any development must take account of the flood risk and the harbour’s designation as a Statutory Port.

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C - 40 4.1.3 Vision for the Newport area

The vision for the area as defined in the Consultation Draft (2015) of the Medina Valley Area Action Plan (AAP) is:

“To see the homes delivered in the Medina Valley as close to where they are required as possible and employment opportunities making the most of the River Medina as a working river”.

Achieving this vision will require development to be located primarily on previously developed land within, or immediately adjacent to existing settlements, protecting the unique identity and characteristics of the settlements to prevent coalescence. Newport will enhance its role as a focal point for employment on the Island, and focus on economic activity that relates to the development of clusters in knowledge-driven and high-tech industries, including marine, renewables and composites. Development will be managed to ensure it is sustainable and avoids negative impacts on the environment; enhancing it where possible. The transport infrastructure and network must be maintained and improved to ensure they can serve the area’s residents and visitors, and facilitate growth.

4.1.4 Recommended regeneration strategy for Newport

The area around Newport harbour provides an opportunity to not only enhance the town centre and quay environment through high-quality commercial and residential development but also to integrate this area more intelligently with the marine and high-tech industry uses extending along the Medina Valley. Newport is a clear employment hotspot with the potential for further development of industry space in the area north of the town around St Mary’s hospital. However, the consultation draft Medina Valley AAP appears to focus on delivering housing growth on greenfield sites around Newport, without a clear case for market demand or link to the economic growth strategy and existing or proposed employment uses on nearby sites, which are likely to influence the housing typologies required. There is a role for the Council and the LEP to facilitate growth by investing in infrastructure improvements around Coppins Bridge, St Mary’s Roundabout and Horsebridge Hill that can unlock these development sites, as well as planning for housing growth that is linked to employment opportunities.

Furthermore, the Council must review the use of its land and assets within the Newport opportunity area, particularly its car parks and the buildings used to provide council services. The Council’s estate (and that of public sector partners) should be

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C - 41 significantly rationalised to generate revenue savings, improve service provision and release additional brownfield sites for development wherever possible. However, increasing the supply of land will not deliver change alone. The Council and its partners need to develop a compelling value-add offer focusing on the qualities of the marine environment and unique industry.

4.1.5 Strategic development sites

Figure 1: Newport strategic sites

Through an evaluation of potential development sites in Newport and in light of the proposed growth strategy, the following strategic sites have been identified as priority projects to be taken forward through the first phase of the Regeneration Programme:

1. Newport Harbour and County Hall car parks: This group of sites identified around Newport Harbour and the area between the quay and County Hall is currently underutilised. It provides the opportunity for a new harbourside mixed- use development including leisure/tourist facilities, commercial and residential development. Moreover it offers the opportunity to transform the quality of new build development in Newport, augment economic activity in the town and generally improve the quality of place to attract further inward investment. There

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C - 42 are access constraints to be overcome to enable development due to known infrastructure issues around the Coppins Bridge roundabout and the flood risk would also require mitigation (part of the site falls within flood zones 2 & 3). Although there are restrictions around uses and development due to its designation as a Statutory Port, these should be alleviated by the harbour revision order currently being progressed by the Council. This project should be controlled by the Council to ensure design and build quality and is likely to be suitable for LEP funding based on an initial analysis of the increased economic activity it could bring to Newport. The site could deliver a total of 65 new homes, 510 new jobs and total income of £750,000 per annum over the period 2018–2027.

Case Study: Wapping Wharf is a new quarter in an important historical and cultural waterfront area of Bristol. It will feature over 600 new homes, along with a wide range of retail, leisure and office space. It will host some of Bristol’s best independent shops and restaurants, in addition to Cargo; Bristol’s first retail yard made from converted shipping containers.

Image 1: Aerial view of the proposed project Source: associated-architects.co.uk (link)

2. Pyle Street Locality Hub: Following the transfer of part of this site to the HCA and work progressed by NHS partners, there is a clear opportunity to deliver a mixed- use community/social (health and wellbeing hub) and residential development on this site. Although improvements at Coppins Bridge and St George's Way are required to facilitate development, it is understood that there are no other significant constraints identified that cannot be overcome as part of the planning and development process. OPE discussions should be used to reconsider the scope, ensuring the proposed development maximises opportunities for integration of health and social care services to help the Council, as well as NHS partners, to

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C - 43 realise efficiencies and improvements in service delivery. The Council’s role in leading discussions around the colocation of 'blue-light' services on the Island could help release the Fire Station for inclusion in the development and potentially release additional sites in Newport for further redevelopment. The site could deliver a total of 69 new homes and total income of £73,000 per annum over the period 2018– 2027.

3. Horsebridge Hill and St Mary’s Hospital: The rationalisation of the NHS estate at St Mary’s Hospital, its adjacency to a large existing industrial estate and vacant land at Horsebridge Hill, as well as other Council ownerships in the area, provide the opportunity for the development of additional employment space for high-tech industry in Newport. Although delivery is likely to be led by the NHS, there is a role for the Council in influencing the rationalisation and proposed uses of any land that is released and in addressing infrastructure constraints around St Mary’s Roundabout and Horsebridge Hill to improve access to the site and facilitate development. There is also an opportunity to rethink the relationship between housing growth aspirations and economic growth and ensure the offer (typology) on site and in the adjacent land at HMP Camp Hill is linked to demand from jobs growth. OPE discussions should be used to reconsider the scope of development on this site in light of the Island’s new Economic Development Strategy. This project is likely to be suitable for a LEP funding bid. The site could deliver a total of 3,000 new jobs and total income of £3million per annum over the period 2018–2027.

4. Stag Lane: Although this site is somewhat constrained by infrastructure access at Mary’s Roundabout and Horsebridge Hill, it is owned by the Council and adjacent to existing high-tech industry (MHI Vestas Offshore). Like the Horsebridge Hill site, it therefore offers the opportunity for development of additional employment space for high-tech industry, linking in with existing uses elsewhere in the Medina Valley. There is a role for the Council in leading discussions with the market about the development of this site and taking forward infrastructure improvements and enabling works (e.g. land decontamination) to bring forward development. This project is likely to be suitable for a LEP funding bid. The site could deliver a total of 1,240 new jobs and total income of £2million per annum over the period 2018– 2027.

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C - 44 5. Land at HMP Camp Hill: This former MoJ site has already been identified for a large mixed-use development comprising approximately 1,300 homes through the Medina Valley AAP. It also forms part of the Parkhurst Forest Garden Village site included in an expression of interest to government earlier this year. The proposed garden village would include new homes; community and social infrastructure; high quality open spaces and landscaping; and retained enhanced heritage assets. However, it is currently unclear whether there would be market take-up of housing on this site. It is recommended that housing typologies should therefore be linked to economic growth on the Horsebridge Hill and Stag Lane sites (e.g. self-build). There is likely to be a role for the Council in carrying out enabling infrastructure works required at St Mary's Roundabout, Coppins Bridge and within the site itself, as well as facilitating network upgrades that are understood to be required within the site. The site could deliver a total of 1,300 new homes, 6,000 new jobs and total income of £7million per annum over the period 2018–2027.

Case Study: Graven Hill, just south of Bicester, is the largest self-build housing project in the UK. When completed, it is expected to host 1,900 new homes. The project offers flexibility in the size, layout, and typology of houses that people can self-build.

Phase 1A opened for sale in August 2016. Demand has been high as buyers recognise the fantastic opportunity to build their dream home at Graven Hill in an environment featuring extensive open space and a strong identity.

Source: gravenhill.co.uk (link)

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C - 45 4.2 Ryde

4.2.1 Introduction to the Ryde Opportunity Area

Ryde is a town and seaside resort on the northeast coast of the Isle of Wight, with a population of approximately 24,000 (source: 2011 Census).

Ryde acts as one of the main gateways to the Isle of Wight. It is connected by ferry and hovercraft services with Portsmouth and Southsea respectively and onwards via mainland trains to London Waterloo. Ferries stop at Ryde Pier Head while both the ferry and hovercraft terminals are located around the Ryde Interchange area and by Ryde Esplanade. Ryde is connected to the rest of the Island by Island Line trains, which runs from the pier head via the esplanade to Shanklin and also by buses, with a major bus interchange located on the esplanade.

Ryde grew in size as a seaside resort in the 19th century and the influence of this era is still strongly visible in the town's centre and seafront (mainly Regency style) architecture. The town is noted for its expansive sands, which are revealed at low tide, making its pier necessary for a regular ferry passenger service. Ryde Pier is a Grade II listed structure, the fourth longest pier in the UK, as well as the oldest pleasure pier in the world.

4.2.2 Opportunities and constraints

Natural environment: Ryde benefits from its location directly on the coast with unobstructed views to Portsmouth and a variety of natural green spaces which provide opportunities for environmental tourism such as walking, cycling and sailing. However, the natural environment also constrains development due to the high flood risk, especially within the Monkton Mead Catchment area.

Employment: As a gateway to the Island and with direct connections to the mainland, Ryde offers employment opportunities both in terms of people commuting easily to the mainland and businesses choosing to locate in the area because of its relative ease of access. There are also industrial sites with potential for growth in the area, particularly towards the south and across the Monkton Mead Brook. However there has been a lack of initiative within the market to bring forward potential development sites, in part due to the recent economic climate.

Housing: Ryde offers opportunities for housing growth and as such several sites have been allocated for housing within the Core Strategy. Outline planning consent for a

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C - 46 large residential development known as the Pennyfeathers site has been granted, although the level of market demand for this housing is unclear and development does not appear to be progressing. Similarly, there is consent for new housing as well as tourist accommodation in a prominent coastal location (Harcourt Sands). Despite these consents there has been a drop in residential development since 2011–12 and there remains an identified need for additional housing. There is an opportunity for the Council to monitor and facilitate development in Ryde and to consider the use of its Compulsory Purchase Order (CPO) powers where development has stalled. The Council must also ensure that new residential development in Ryde is of a high-quality design that reflects the historic and unique character of the town, thereby strengthening the identity of the place.

Transport Infrastructure: Ryde benefits from its ferry connections to the mainland, as well as bus connections and the Island Line railway, which connects the town to Shanklin via settlements along the coast. However, the Island Line is very outdated, as are the facilities at the interchange area connecting the railway with ferry, hovercraft and bus services on the esplanade. Furthermore, a lack of town planning has led to road congestion and difficulties in wayfinding, which leads to a lower quality experience for both visitors and residents. Following a failed attempt in 2006, there is now a clear opportunity to revisit the project to replace the outdated interchange facilities in order to create a strong gateway to the Island and fully reflect the important and unique character of Ryde.

Tourism and Leisure: Ryde features an interesting topography with the dominating Grade II listed pier and memorable skyline rising behind the esplanade. There is a variety of all-weather leisure activities (swimming pool, tennis courts, bowling and ice rinks, mini-golf, boating lake etc.) on offer, as well as opportunities linked to the natural environment. However, the town’s prominent leisure facilities located along the esplanade are outdated and poorly-designed in terms of the location of adjacent car parking, as well as the design of the buildings and facilities themselves. Linking the replacement and/or redesign of these facilities with a new interchange could transform the town and visitors’ impressions of the Island. There is also undeveloped land along the coast (Harcourt Sands) with potential for high-quality residential and leisure development. Overall there is the potential to significantly enhance the tourist and leisure offer for residents and visitors alike.

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C - 47 4.2.3 Vision for the Ryde area

The vision for the area as defined in the Consultation Draft (2015) of the Ryde AAP is:

“To see the wider Ryde area as a vibrant gateway to the Island where the needs of residents and visitors are met to the highest standards”.

Achieving this vision will require sustainable residential growth that meets current and future demand and enhances the built environment, whilst respecting and mitigating negative impacts on the natural environment. It will also require support for existing and potential new businesses (especially SMEs, retail offer, knowledge and high-tech industries / clusters and tourism offer) to improve employment opportunities and the tourist offer. Exploring all improvement opportunities for Ryde’s transport infrastructure and network will also be key to achieving this vision.

4.2.4 Recommended regeneration strategy for Ryde

Ryde has the opportunity to be a striking gateway to the Isle of Wight but currently suffers from poor infrastructure investment and town planning decisions, prioritisation of vehicle parking along the seafront and a low-quality tourist and leisure offer. By redeveloping the area from the pier heading east along the esplanade (including the transport interchange, outdated leisure facilities and car parks), the impression of the town and the Island given to visitors could be transformed. Any development should recognise and enhance the town’s heritage assets and character and exploit its position looking out across the Solent.

The Council should consider enhancing the sustainable transport options for foot passengers visiting the Island, including electric car and bike charging services at the arrival point and commensurate services at other key destinations to diversify the tourist offer. As one of the key areas for employment on the Island, the Council should aim to facilitate the development of additional employment space, through infrastructure improvements where these are required to unlock private sector investment. Any housing or tourist accommodation development must reflect and enhance the town’s unique character to encourage further investment and attract high-quality tourism and leisure operators. Where housing developments stall the Council should consider use of its CPO powers to intervene where appropriate.

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Case Study: Folkestone’s regeneration is based on a cultural and educational approach, driven by events, festivals and fixed-term projects. It aims to create new cultural markets by fostering the development of autonomous innovative and entrepreneurial local capacity.

It includes plans for ambitious seafront private development that will partially pay for public infrastructure.

Images: Beach side intervention in Spain. Artist view of seafront regeneration project in Folkestone. Source: landezine.com; micro-costas 04 www.kentonline.co.uk (link)

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C - 49 4.2.5 Strategic development sites

Figure 2: Ryde strategic sites

Through an evaluation of potential development sites in Ryde and in light of the proposed growth strategy, the following strategic sites have been identified as priority projects to be taken forward through the first phase of the Regeneration Programme:

1. Ryde Interchange and Esplanade site: The site is located in the Ryde Esplanade area by Ryde Pier, and immediately to the north of the town centre. The site is within a flood risk zone, the Ryde Conservation Area and Special Protection Area (SPA) zone. It is also within a site of special scientific interest and is located opposite listed buildings. Ownership of the site is shared between IWC, Hovertravel, Network Rail and Wightlink Ferries (predominantly within the ownerships of Network Rail and IWC while the road section of the pier and the old tramway belong to Wightlink). The Interchange is a main gateway to the Isle of Wight. It is directly connected to the mainland by ferry and hovercraft and to the south of the island by train (the Island Line). Elements of historic importance and unique character, such as the Grade II listed Ryde Pier are adjacent to, or fall within the site. Replacing the outdated ticketing and retail facilities, improving the public realm and designing more coordinated pedestrian and public transport networks

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C - 50 would create an iconic environment for Ryde, as well as for the whole of the island, and upgrade the experience for visitors and residents alike. The development should be led by the Council in partnership with Hovertravel, Network Rail and Wightlink Ferries. The main focus should be on a design bid that will ensure the delivery of a new interchange complex with a simple but strong visual identity, well- integrated to the historic surroundings. Any new design should also consider improvement of wayfinding and mitigation of circulation issues for both pedestrians and vehicles. Robust cost assessment and viability studies of the design and masterplan should be considered from an early stage. The site could deliver a total of 150 new jobs and a total income of £260,000 per annum over the period 2018–2027.

Case Study: Originally completed in 1869, Hastings Pier was closed in 2008 for safety reasons and virtually destroyed by fire in 2010.

Thanks to a £14.2m reconstruction project, the pier was re-opened in April 2016, and is a central element of the Hastings regeneration plan.

2. Harcourt Sands and Puckpool park site: Given this site’s prominent seafront location, any potential development should consider building scale, massing and heights in relation to adjoining buildings, views and the seafront. There may be constraints due to topography, ecology and arboriculture as the site is adjacent to ancient woodland. The site is privately owned and has been previously developed. There is an existing planning permission for new homes (including affordable

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C - 51 housing), tourism accommodation and leisure facilities. The site is within an excellent seafront location with unobstructed views to Portsmouth, directly connected to a network of natural open spaces and within walking distance from Ryde town centre and interchange. Delivery is being led by a developer and private owner but the intervention of the local authority should be considered where this is necessary to ensure development is progressed in a timely manner and to a sufficiently high standard. This site is one of several sites that offers potential to transform the quality of the tourism offer; an opportunity that should not be missed. Any S106 contribution gained from the development could be used for leisure and tourism facilities that could be located on the unexploited beach and Puckpool park areas. The site could deliver a total of 160 new homes, 160 new jobs and a total income of £500,000 per annum over the period 2018–2027.

Case Study: A private initiative aimed at putting Littlehampton in Sussex on the map by delivering small flagship projects that have become postcards of the coastal town.

Image 1: East Beach cafe, Thomas Heatherwick, 2007. Source: akt-uk.com (link)

Image 2: Acoustic Shells, Flanagan Lawrence, 20. Source: deezen.com (link)

Image 3: West Beach café, Asif Kahn architects, 2008. Source: deezen.com (link)

3. Industrial Estate Extension (Nicholson Rd): This site is undeveloped land adjacent to an existing industrial estate, which includes a mineral safeguarding area. It therefore offers an opportunity to extend the industrial estate. The site is considered an employment allocation area as the extension of the existing neighbouring industrial estate could deliver additional employment floorspace, new jobs and enhance the tax base. Transport and traffic access mitigation are

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C - 52 likely to be required and also flood risk mitigation as the site sits next to the Monkton Mead catchment flood risk area. The extension of the industrial estate is subject to market demand and development viability. Development may require a public sector role to ensure flood risk mitigation and investment in infrastructure or transport access. This project is likely to be suitable for LEP funding based on an initial analysis of the increased economic activity it could bring to the area. Feasibility studies, a concept masterplan, viability assessment and identification of funding routes will be required before this project can transition to Outline/Full Business Case, planning and delivery. The site could deliver a total of 840 new jobs and a total income of £870,000 per annum over the period 2018–2027.

4.3 The Bay

4.3.1 Introduction to The Bay Opportunity Area

Sandown and Shanklin are the two main resort towns on the Island and are joined by the settlement of Lake. The area became prosperous from Victorian times as established holiday destinations, together forming the largest resort on the Island, which is known as The Bay.

The beach and promenade run the full length of the coastline between the two towns, with Sandown and Shanklin sitting behind, both of which are Victorian and Edwardian in nature with a range of local and tourist-related businesses. Sandown esplanade features a number of large scale buildings and uses including the Zoo and Dinosaur Isle, open spaces, leisure uses, a pier and the beach. Shanklin and Sandown both have railway stations close to the town centres, served by the Island Line that runs from Shanklin to Ryde Pier Head. Shanklin old town is the historic core of the town and features picturesque cottages along winding streets, and tourist uses such as cafes and gift shops. Between the promenade at Shanklin and the town is the bay cliff and gardens area, which includes a number of public parks, gardens, larger hotels, and Cliff Lift, which takes visitors from the hotels along the cliff to the promenade.

The area has had an historic dependence on tourism but shifts in holidaying patterns have had a significant impact, resulting in a lack of investment in the area over a sustained period of time. The area is not seen as a positive environment for investment and includes pockets of deprivation and poor health. However, there is a strong community aspiration to realise the area’s potential.

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C - 53 4.3.2 Opportunities and constraints

Natural environment: The Bay’s beaches, cliffs and topography make it an attractive tourist location but constrain development in the towns and to the esplanade. For example, development in Sandown is only practicable on the north side of the high street, and restricted to small scale and infill developments. There is also a significant flood risk in some areas, particularly the area around Dinosaur Isle, the boating lake and golf course.

Employment: The Bay area is not seen as a positive environment for investment. There is an identified need for small and medium-sized employment units and for small-scale and low-cost office accommodation, to meet generally local demand. However, the area does not attract the same high-tech industries with the potential for growth found elsewhere on the Island. The retail offer in the area is weak and lacks national multiples, and appears heavily reliant on tourism, which results in seasonal and low-paid employment opportunities.

Housing: There is identified demand for 1-bed affordable properties and 2-bed market properties in the area, plus family homes to support higher-end employment sectors. However, there is a lack of development options, with housing sites limited to conversion of existing uses or medium-sized greenfield sites. There is potential to convert lower-quality visitor accommodation and bring space above commercial properties back into use for residential uses. There is also likely to be a market for specialist older people’s housing in the area.

Transport Infrastructure: Although Shanklin and Sandown are connected to Ryde via the Island Line, the area remains relatively isolated and reliant on the road network connecting it north to Newport and south to Ventnor. Improvements to the Island Line and road network would improve access and the experience for residents and visitors alike. A managed approach to car parking provision along the esplanades could help release development to enhance the tourist offer and improve the quality of place. However, this approach would need to be carefully considered to ensure any consolidation of car parking does not deter visitors from accessing the beaches and the businesses serving them.

Tourism and Leisure: The Bay area is heavily reliant on tourism and leisure and this is likely to remain the case. The tourism and retail offer is run down in many places and at the lower end of the market generally. It includes a number of marginal businesses and uses, an oversupply of hotel stock, low-quality tourist accommodation and some landmark buildings that are seen as ‘eyesores’. However, there are natural assets such

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C - 54 as the beaches and parks (for example Shanklin Chine) and collections of attractive buildings (such as Shanklin old town). Therefore, it is important that the area develops a clear and distinctive high-quality tourism offer, which makes best use of landmark buildings in prominent positions. There are also significant opportunities for development on the esplanade, around Culver Parade and the potential to enhance the tourism offer between Fort Street and the Isle of Wight Zoo. However, these sites are significant in size and the nature of their specialist use (such as Dinosaur Isle) presents challenges in developing viable uses.

4.3.3 Vision for The Bay area

The vision for the area as defined in the Consultation Draft (2015) of The Bay AAP is:

“To create an area with a modern tourist offer, where existing and new businesses are supported and residential development is provided to meet the requirements of the community and links from the town to the surrounding countryside are improved”.

Achieving this vision will be dependent on the development of a seafront with a vibrant, year-round offer, achieved by improving the quality and range of tourist accommodation, retail and the night-time economy. In order to substantially increase the value of the tourist industry and the economy of the area, the provision of top- quality tourist accommodation and facilities will be needed. Improved connectivity for vehicles and pedestrians and the railway must also be considered, as well as the delivery of new housing, including the conversion of low quality tourist accommodation.

4.3.4 Recommended regeneration strategy for The Bay The Bay is a key tourist destination on the Island but suffers from an outdated, low- quality offer and lack of investment by private landowners. Raising the standard of tourist accommodation and facilities is a key priority for attracting further investment from the private sector and encouraging new tourist markets. However, it is unlikely that the Council investing heavily in its own tourist attractions (e.g. Dinosaur Isle) will alone result in the step-change required to transform the area. The Council should focus efforts on encouraging investment from high-quality operators in prominent locations, such as Shanklin and Sandown’s seafront promenades. There is also an opportunity to rationalise and develop sites in public ownership in the locality to facilitate housing growth and ensure that health and social care services are fit to meet the needs of its ageing population.

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C - 55 4.3.5 Strategic development sites

Figure 3: The Bay strategic sites

Through an evaluation of potential development sites in The Bay area and in light of the recommended growth strategy, the following strategic sites have been identified as priority projects to be taken forward through the first phase of the Regeneration Programme:

1. The Heights Locality Hub: This is a primarily council-owned site currently occupied by a leisure centre, council office and healthcare uses. As part of the NHS Local Estates Strategy an options appraisal has been undertaken which proposed the creation of a new health and wellbeing hub to serve the South Wight area, alongside the existing leisure centre. This would consolidate health uses in the area and release the Arthur Webster Clinic site in order to obtain a capital receipt. This project was included in the recent OPE expression of interest to central government. OPE discussions should be used to review the scope, ensuring the proposed development maximises opportunities for integration of health and social care services to help the Council, as well as NHS partners, to realise efficiencies and improvements in service delivery. This should include a review of the car parking provision on site and the potential addition of residential (e.g. extra

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C - 56 care housing), should the site capacity allow for this level of development. The site could deliver a total of 24 new jobs and total income of £100,000 per annum over the period 2018–2027.

2. Shanklin Spa Hotel & Seafront Car Parks: Formed of three sites along the Shanklin promenade currently used for car parking; one site, adjacent to the Cliff Lift, includes a derelict hotel building. There is an opportunity to consolidate car parking onto a single site along the seafront and release the surplus car parks for high quality leisure and commercial development as part of a transformed offer in Shanklin, which complements Shanklin Old Town, the Cliff Lift and promenade. It is essential that any leisure or commercial development on these sites raises the bar in terms of the quality of the tourist offer, in order to drive further improvements in tourist accommodation and facilities in the area. The approach should therefore be targeted towards a high-quality boutique hotel or commercial leisure operator, who would make a feature of the iconic Cliff Lift and find innovative ways to incorporate this in any development. The sites could deliver a total of 20 new jobs and total income of £50,000 per annum over the period 2018–2027, but more importantly help to significantly increase development value in the area over the long term.

Case Study: Lift in Hernani, Spain, which connects two neighbourhoods of the town and an adjacent public building. It has become an important tourist attraction. Image: Elevator refurbishment in Spain Source: www.archdaily.com (link)

Case Study: The Lacerda Lift in Salvador de Bahia opened in 1873 and is claimed to be the first public lift in the world. It is used by an average of 900,000 passengers per month and has become a tourist landmark and an icon of the city. Image: Elevator in Salvador de Bahia, Brazil Source: discoverbrazil.com (link)

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Case Study: Boutique Hotels

“Rather than simply viewing the hotel as accomodation, clients are looking at the hotel to provide an experience in itself”. Market Report on Hotels (Drewer, 2005, p.6)

There appears to be scope for further development of boutique hotels with the sector currently outperforming general UK hotel trading. (Caterer Search, 2005)

Image 1: Watergate hotel, North Cornwall, UK Source: high50.com (link)

Image 2: Vals Thermes, Switzerland Source: www.worldarchitecturemap.org (link)

3. Sandham Middle School: This redundant school building on the edge of Sandown has the potential to provide a residential development and is considered particularly suitable for an extra care housing development, as part of an Island- wide extra care housing strategy. Residents of any extra care facility would be able to take advantage of the site’s relative proximity to Sandown town centre, train station and the health and social care services based out of The Heights site. This would reduce the requirement for additional facilities within the extra care scheme and ensuring its residents remain independent and part of the local community. The Council’s recent decision to demolish the old school building provides the opportunity for development to progress at a reasonable pace. The Council is recommended to undertake further enabling works to the site to de-risk development and consider delivery of the scheme either directly or with a Registered Provider / specialist provider partner. The site could deliver a total of 60 new extra care homes and total income of £45,000 per annum over the period 2018–2027, as well as savings to the Council’s Adult Social Care department through a reduction in the use of residential care.

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C - 58 5 SETTING UP THE REGENERATION PROGRAMME This section provides a framework through which the Isle of Wight Council can gear up to deliver the growth and change needed. It includes a series of recommendations regarding the form and function of the new Regeneration Team Programme Management Office (PMO) to deliver the Island growth agenda.

5.1 Intelligent client function

Delivering the desired value from the Regeneration Programme requires an intelligent approach that orchestrates the collective resource, skill, energy and creativity of a wide range of parties. It requires the prudent yet entrepreneurial investment of public resource. It requires the investment and commitment of private individuals and enterprise. It requires the coordinated effort of motivated, high-performing individuals in functional organisations and through good voluntary governance and effective contractual relationship. Acknowledging that the Council cannot and should not try to deliver the entire regeneration programme, it must take a strong civic leadership and entrepreneurial approach. It is important the Council considers itself as having an intelligent client function to orchestrate the following three interconnected themes:

1. Partnership and stakeholder management (clarity of purpose and consensus, enabling progress) 2. Design and product development (to create value) 3. Contract management (controlling quality, costs and time)

The diagram overleaf shows how these themes connect and the typical activities involved under each theme.

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Figure 4: Intelligent Client themes diagram

5.1.1 Partnership and stakeholder management

It takes many and varied stakeholders to change a place and realise a successful regeneration programme. These stakeholders may include large institutions like universities, cultural facilities such as the Tate, multinational businesses or public sector groups such as the LEP. It can also often be small voluntary groups, cafe owners and entrepreneurs that stimulate change through a series of small scale actions. However, people and groups can also slow or stop change and growth, through objections, lobbying or civil action: a common problem in coastal towns. It is therefore vitally important to ensure that effective stakeholder engagement and partnership working is integral to the development of the programme and resourced appropriately.

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C - 60 RECOMMENDATION: Develop a partnership approach to programme delivery and stakeholder management.

5.1.2 Compelling vision and consensus

Experience from the vast majority of successful regeneration programmes indicates the need for a compelling vision and consistent leadership with a gritty determination and focus on delivering the vision. Communities need to be able to see benefits for themselves and future generations through the vision and are more likely to respond positively to projects contributing towards an overall vision that demonstrably benefits the place and the people. Transformation on the Isle of Wight should leave no one behind.

From a real estate development perspective, any investor in the Isle of Wight will want to know that there is a vision and a sustained political commitment to that vision before they commit to doing business in the locality, and certainly before they enter into any partnership with the Council. The development industry will look for certainty in policy and decision-making. Investors will be put off by uncertainty, particularly in the planning system where the costs are extremely high.

When embarking on any major regeneration programme, it is vitally important to keep at the forefront of one’s mind that no one stakeholder can deliver all the change or solely responsible for success. Success will almost certainly only come through well- coordinated, collective effort on behalf of public institutions, but moreover private enterprise.

RECOMMENDATION: Continue to develop a vision and 20-year growth plan for the Isle of Wight in partnership with all stakeholders on the island and in the wider Solent conurbation.

5.1.3 Guiding principles

A well supported vision should be underpinned by principles and objectives that tease out the collective aims how they will be achieved. A robust set of principles will govern behaviours and maintain a consistency of focus and quality. Below are example principles that could guide the programme:

● Outward looking but inwardly reflective ● Commitment to a 20-year growth plan ● Focus on a series of major transformations

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C - 61 ● Commitment that no-one is left behind ● Take a long term approach to value creation and asset management ● Make the Island a vibrant place to be an entrepreneur ● Make a virtue of being an Island ● Do everything in your power to ensure the burden of fulfilling the vision is shared ● Commit to evidenced-based decisions ● Commit to resourcing the team appropriately

RECOMMENDATION: Develop a set of principles that all can sign up to which will govern the behaviour of all of those involved.

5.1.4 Creating value through design and product development

The design of any scheme and the qualities of the product (in whatever form) create value. Moreover, in the context of the Isle of Wight’s three pillars of growth, the definition of value goes beyond financial value and must encompass social, economic, cultural and environmental value. Achieving this requires a creative, open client function that is able to articulate a clear vision and broad set of requirements, and understand how to facilitate the creative process of generating a response to a brief that generates value.

5.1.5 ‘Great Estates’ long-term approach to asset management

In the recent past it has been common policy for councils to sell real estate assets to gain capital receipts. This has been encouraged as councils have moved from direct deliverers of services to enablers. However, the short-term gain in capital receipts is rarely outweighed by the long-term opportunity cost from disposing of an asset that increases in value or the ability to utilise that asset for year-on-year revenue generating or cost-saving activities.

The Great Estates of England, or more specifically London, provide a good lesson; however, it is not necessary to look back to the 17th and early 18th century landowners. There are current examples from cities like Manchester and modern developments of the Olympic Park or King’s Cross. These landowners have retained the freehold of their real estate, thereby earning ground rent as a minimum or leveraging shared profit from development of their land whilst sharing risk and development cost.

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C - 62 The Great Estates model of managing a real estate portfolio is underpinned with a strong commercial bottom line. However, it recognises that value is created by having a desirable product (the property for rent), in a desirable area (access, services, cleanliness, safety, sense of community). Investment in public places and private spaces that are currently undesirable, to create interest and footfall as well as desirable homes, can dramatically increase return on investment. Creating high street attractions with a balanced and distinctive offer can lead to improved rents in the private residential element of a property portfolio. In the case of a local authority this not only means increased commercial gains from assets but an increase in the tax base, which can be redistributed through better service provision or reinvestment. Furthermore, the Great Estates model has the advantage of scale, enabling better bargaining power with the supply chain.

RECOMMENDATION: Adopt a Great Estates approach to managing your real estate portfolio by retaining assets, strategically investing to create the most value and maximising your long-term return on investment.

5.1.6 Brand

The Isle of Wight is an institution in its own right. However, it is often associated with a contradictory blend of being historic yet outdated; beautiful yet run down. The Council and local stakeholders need to reconsider what ‘brand Isle of Wight’ means and how they project that externally. Strong place branding celebrates successes, uncovers hidden gems and is open to change. The Isle of Wight needs to embrace quality, wellbeing and innovation in its plans for growth and regeneration.

5.1.7 Define the value each project will bring at an early stage

It is important that a clear connection is made between the compelling vision and each project: a golden thread running throughout. Each project should aim to develop a fine-grain understanding of the value that it seeks to create in terms of economic, social, environmental and financial benefits and these should be embedded in the vision for the Island. This will help prioritise the investment of finite resource, help secure additional investment and help create consensus and support for a project as it progresses through planning.

RECOMMENDATION: Ensure each priority project has clear values that it is aiming to achieve from the outset, and that these values or benefits are making a measurable contribution to the Island Vision.

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C - 63 5.2 Project controls (contract management, cost, time, risk)

Project control and contract management is the theme that controls time, cost and risk and helps realise the value set by the other themes. These require strong processes and procedures, a rigorous approach to reporting and change control and delivery managers who are empowered to make decisions.

5.2.1 Evidence-based approach

Throughout our review of the Isle of Wight’s current set of strategies, corporate plans and projects, there has been a significant lack of visible, accessible, meaningful quantitative analysis. The JSNA provides a high-level summary of national statistics on the wider determinants of health. The economic development strategy also contains some high level analysis. However, the Corporate Plan’s performance indicators are not closely linked to issues highlighted as important. GIS data has been hard to extract and the Council’s asset register has insufficient up to date information about the condition of the operational estate. This demonstrates the need for the Council to take decisions based on good quality information, enabling faster and better decisions to be taken, and ensuring that decisions are transparent and more likely to be supported by the majority, rather than opposed.

Evidence-based decisions will be vital for high-value capital projects. The more sound data that can be used to develop a baseline as early as possible in the decision-making process, the better the value added and the greater control the Council will have around costs.

RECOMMENDATION: Commit to an evidence-based approach to decision-making and ensure sufficient resources are made available for data gathering and analysis.

5.2.2 Programme Management Office with a relentless focus on the progression of projects

It is important to have a shared understanding of the lifecycle of major capital investment projects and what needs to happen when, in order to progress a project to successful completion. A partner of Inner Circle Consulting once described the process of developing a capital project as akin to that of the transition from a gaseous state, to liquid and on to becoming a solid. At the beginning a project has a relatively undefined scope, is difficult for all to perceive and can easily be blown off course, like a gas. As a project matures it has much greater definition and tangibility, but in becoming rigid it is difficult (and costly) to change, like a solid. Moreover, to achieve the change of state

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C - 64 from gas to liquid usually takes sustained pressure, much like successful project leadership. The following diagram shows the gas-solid transformation and describes the various stages through which a project must progress.

Figure 5: Project transformation diagram

RECOMMENDATION: Adopt a consistent method of project progression, change control and investment decision-making.

RECOMMENDATION: Establish a strong programme management office with an appropriate blend of skills, experience and tenacity to design, develop and implement the regeneration projects.

5.2.3 Developing Business Cases

Bringing themes of evidence-based decision-making and robust project management, we believe that each project should be developed through a consistent business case process. This ensures best value for money, transparency of decision-making and the process enables stakeholders to reach consensus.

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C - 65 RECOMMENDATION: Ensure all investment decisions are underpinned by a sound business case. Develop all business cases commensurate with the Treasury Five Cases model (Greenbook) taking them through an incremental process of development from Strategic Outline Case, Outline Business Case to Full Business Case.

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C - 66 6 REGENERATION PROGRAMME RESOURCE AND ACTION PLAN Inner Circle Consulting’s gap analysis of the proposed Regeneration Programme has been used to develop a detailed resource and action plan until March 2017, during which time the projects will be developed to Outline Business Case (OBC) as far as practicable. This section of the report sets out the recommended resourcing required during this stage of the programme and an action plan for delivering the programme and projects successfully.

6.1 Next stage action plan

6.1.1 Secure the mandate and evolve governance arrangements Members must be fully engaged in the Regeneration Programme and the mandate to proceed secured before it can progress at pace. This will be achieved through meetings and presentations to Lead Members, the informal Executive and Economic Development Select Committee in November 2016, prior to a formal decision by the Executive in January 2017. The mandate will then be reinforced through the formal budget setting process, which concludes at Full Council in February 2017.

As part of securing the mandate it is essential that approval for further decisions made as part of the programme are delegated to the Leader and/or portfolio holder for regeneration, in order to ensure speedy and effective decision-making. Delayed decisions can lead to missed commercial opportunities and send a message to the market that the Council may not be fully prepared for growth.

During November 2016 the governance of the programme should be evolved. The Growth Working Group established during the initial scoping stage of the programme can be expanded as required to form a new Regeneration Programme Board, with updated Terms of Reference. The mechanism that this board reports into Members should also be established.

RECOMMENDATION: Secure a clear mandate for the Regeneration Strategy and Programme from Members and establish suitable governance arrangements, including a Regeneration Programme Board, and delegated authority to the Leader and/or Lead Member for subsequent decisions relating to the programme.

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C - 67 6.1.2 Set up the programme

The first step in setting up the programme is to agree to the appointment of an interim Programme Manager, experienced in leading multidisciplinary teams and delivering complex capital and regeneration projects.

The programme scope also needs to be defined. This should align with all relevant research, strategy development and capital project delivery. Consistency of reporting and decision-making through the established governance channels is important to ensure a coordinated portfolio of activity. For each project within the programme, the relevant project leaders must be engaged as part of a detailed stakeholder management strategy. Existing programmes and cross-cutting strategic projects with a direct link to the aims and activities of the Regeneration Programme should also be brought under the remit of the programme.

The Programme Manager will then proceed to procure programme-level expertise (e.g. cost-consultancy, professional services, masterplanning etc.) on behalf of the Council and establish exemplar ways of working, by producing and refining systems, procedures, reporting mechanisms and templates. The Programme Manager will also have a role in identifying further internal resource within IWC (e.g. through internal secondments) and developing this resource to build an effective internal team to eventually deliver projects.

RECOMMENDATION: Appoint an experienced Programme Manager to procure programme-level expertise, establish a programme delivery team (including internal IWC resources), together with all relevant processes.

6.1.3 Initiate priority strategic projects

During November the priority strategic projects must be initiated in order to progress them sufficiently to meet the March 2017 deadline for LEP funding bids. Project initiation will involve identifying project leads (including internal officers where appropriate), setting the scope and desired outcomes for each project, establishing the budget and resources required to deliver the project and progressing project-level procurement of expertise.

In order to meet externally imposed timescales (e.g. LEP bidding deadlines) it is likely that it will be necessary to prioritise some projects and re-programme other projects to be progressed at a later date.

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C - 68 RECOMMENDATION: Initiate projects by identifying project leads, establishing budgets, agreeing the scope, objectives and programme. Consider prioritising certain projects to meet LEP bidding deadlines.

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