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5. Impact of a Second Arena in Manchester DocuSign Envelope ID: 24D87FF4-419D-418E-9AD3-3F01ACAFF50F 11 June 2020 Planning Strategic Development Directorate Manchester City Council P O Box 532 Manchester M60 2LA Dear Sir or Madam Application reference: 126431/FO/2020 - Erection of a multi-use arena with ancillary retail/commercial uses in Eastlands (“Application”) Applicant: OVG Manchester Limited (“OVG”) This letter and the reports which accompany it comprise ASM Global’s representations in response to the Application. ASM Global and their team of technical specialists have undertaken detailed analysis of the Application submission documentation to inform their response. In addition to this letter, our representation includes the following; 1. Planning objection, prepared by P4 Planning with input from Grant Thornton (the latter report was prepared in response to the 2019 Eastlands Regeneration Framework 2019 Update) 2. An independent Economic Analysis of Manchester Arena Market, prepared by Charles Rivers Associates 3. An independent Eastlands Transport Review, prepared by Blacc and Mott MacDonald, with input from Air Quality Consultants and Movement Strategies. The submission reports and the associated appendices should be read fully and in conjunction with one another. A summary of ASM Global’s objection case is included at the front of the planning objection (document 1 above). ASM Global & Manchester Arena ASM Global is an international venue and event management business, and is the tenant and operator of Manchester Arena. ASM Global’s portfolio includes over 300 of the world’s foremost venues across five continents, which serve host to thousands of concerts, a huge range of live entertainment events, prestigious sporting events, conferences, conventions and exhibitions. Manchester Arena is an essential part of the fabric of Manchester city centre. Its city-centre location, proximity to transport connections, large capacity and flexible space have, for 25 years, attracted the ASM GL OBAL EUROPE Manchester Arena +44 (0)161 950 5000 Victoria Station asmglobal.com Manchester M3 1AR United Kingdom ASM Global is the trading name of a group of companies, including SMG Europe Holdings Limited, a company registered in England and Wales with company number 05558259 whose registered office is at Manchester Arena, Hunts Bank Approach, Manchester, M3 1AR DocuSign Envelope ID: 24D87FF4-419D-418E-9AD3-3F01ACAFF50F biggest names in live entertainment to Manchester, in turn driving large numbers of visitors to the city centre whose consumer spend supports city-centre businesses and jobs. Application predicated on flawed economic analysis OVG’s Application confidently asserts there is demand for two 20,000+ capacity arenas in Manchester, but that assertion simply isn’t supported by market data. In order to construct an argument that there is a market for a second arena, OVG forecasts in its Application, growth of circa 150% by 2035 (more than double the existing market). Neither ASM Global (the world’s largest event and venue management company), nor its independent economic consultant can discern any credible basis for this projected growth. The data source used by OVG in fact shows relatively flat growth over the past ten years, and forecasts based on past trends would result in market growth of 5% over the next 15 years, not 150% as inexplicably predicted by OVG. Relatively flat growth was also forecast by event promoters interviewed on behalf of Grant Thornton in 2019. One promoter predicted (before the impact of COVID-19 was considered) that there “might be some growth maybe 1-2%” and another noted “there is talk of a new stadium in Manchester near the Etihad. Not convinced there is enough content in Manchester to flourish”. Even if the overly aggressive and unsubstantiated growth projections forecast by OVG were achievable, independent analysis shows it is still not enough to support two 20,000+ capacity arenas in Manchester. Granting the Application in circumstances where there is no market for two similar venues would mean that the Manchester Arena and the new arena would have to compete for events, which will inevitably result in an unsustainable loss of events for Manchester Arena. This would cause irreparable harm to Manchester Arena’s long term viability and mean it would not be able to proceed with its transformational redevelopment plans, detailed below. Independent analysis by Grant Thornton also demonstrates that Manchester Arena and its visitors support over 2,000 jobs in Manchester and approximately £60m in GVA contributions to GDP, and attracts an estimated gross visitor spend of £120m within Greater Manchester (90% of which is to the city centre). The harm expected to be caused to the Manchester Arena as a consequence of the proposed development would also extend to city centre bars, restaurants and shops which rely on footfall generated by events at Manchester Arena. Planned multi-million-pound investment in Manchester Arena As you are aware from pre-planning application discussions, ASM Global is at an advanced stage of planning a transformative, multi-million-pound investment to modernise and increase the capacity of the Manchester Arena. We are grateful for the support shown by Manchester City Council to date in response to these plans; however, the approval of OVG’s Application would place ASM Global’s planned investment, and the continued survival of Manchester Arena, at substantial risk. In the event planning permission is granted and implemented, ASM Global would not be able to make its planned investment, or indeed continued investment in the Manchester Arena, because there would no longer be any viable business case to support it. The National Planning Policy Framework is clear that planning decisions must support the vitality and viability of town and city centres, and any out of centre development should not be granted planning permission where it would have a significant adverse impact on planned investment in the city centre. Impacts on Manchester city centre The risk of damage to Manchester city centre is amplified by OVG’s proposal to include over 17,000m² of ancillary retail / commercial space. In an attempt to alleviate some of the problems associated with a lack of public transport options insufficient parking provision, and significant traffic congestion around the DocuSign Envelope ID: 24D87FF4-419D-418E-9AD3-3F01ACAFF50F proposed site, customers are encouraged to arrive over a three hour period and leave over the course of an hour. This would have a direct adverse impact on the city centre by driving consumer spend away from its bars, restaurants, cafes, and shops for an extended period of time. Manchester city centre requires support to recover after COVID-19 Like many city-centre businesses, Manchester Arena is currently closed because of the restrictions in place to control the COVID-19 pandemic. Sadly, it seems inevitable that those restrictions, and challenges city-centre businesses will face as lockdown eases, will cause untold harm to the entertainment, hospitality and retail businesses in Manchester city centre. Manchester Arena believes that it has a significant role to play in attracting visitors back to the city centre as Manchester emerges from this crisis and sees it as essential that, in these extraordinary times, the vital city-centre economy receives the support of Manchester City Council to limit the potential for devastating damage. Withdrawal of the Eastlands Regeneration Framework (“ERF”) You will note we have included copies of the exchange of correspondence in relation to the cancellation of the decision to adopt the ERF as an annex to our representations (document 1). In the interest of transparency, it is our intention to publish our representations and annexes on our website but we are mindful that Manchester City Council may first wish to express a view on the publication of the exchange of correspondence relating to legal action. If that is the case, we invite the Council to notify us of its view, and the reasons for it, within 7 days of the date of this letter so that we may consider the position, whilst reserving ASM Global’s rights fully. Conclusion We trust Manchester City Council will give due and proper consideration to the important points raised in ASM Global’s representations on the Application. If any clarification is required, please contact ASM Global’s Legal Counsel, Freyja Handy ([email protected]). ASM Global respectfully requests that Manchester City Council refuses planning permission for the OVG scheme for the reasons set out in its representations. ASM Global fully reserves its right to make any further representations it considers necessary or appropriate. Yours faithfully John Sharkey Executive Vice President, ASM Global (European Region) ASM GL OBAL EUROPE Manchester Arena +44 (0)161 950 5000 Victoria Station asmglobal.com Manchester M3 1AR United Kingdom ASM Global is the trading name of a group of companies, including SMG Europe Holdings Limited, a company registered in England and Wales with company number 05558259 whose registered office is at Manchester Arena, Hunts Bank Approach, Manchester, M3 1AR Economic analysis of Manchester Arena Market Response to PwC and ekosgen reports Prepared for ASM Global June 2020 Economic analysis of Manchester Arena Market Introduction We understand that Oakview Manchester Limited (OVG) has submitted a planning application for permission to build a new 23,500 capacity venue in Manchester (the “New Arena”). We have been asked by ASM global to assess two reports prepared by PwC 1 and ekosgen 2 submitted in support of OVG’s application. We have been asked to assess the validity and robustness of the assumptions made and whether there is likely to be sufficient market growth to accommodate a second large arena in Manchester without detrimental impact on the city centre economy. Both reports argue that there will be significant market growth in Manchester that would support the New Arena. This material market expansion is argued to be driven both by general trends in the entertainment market and by “supply-led growth” (i.e.
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