Fort Halstead : Towards a Development Framework (Employment Opportunities)
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Fort Halstead : Towards a Development Framework (Employment Opportunities) A Report by Regeneris Consulting Armstrong (Kent) LLP Fort Halstead : Towards a Development Framework (Employment Opportunities) April 2012 (Updated with new Final Section August 2012) Regeneris Consulting Ltd 70 Cowcross Street London EC1M 6EJ 0207 608 7200 www.regeneris.co.uk ● Fort Halstead : Towards a Development Framework (Employment Opportunities) ● Contents 1. Introduction 1 2. The Current and Immediate Future Economic Role of Fort Halstead 3 3. Economic Profile of Sevenoaks 6 4. Existing Sevenoaks Employment Land Evidence and Related Research 10 5. Other Employment Uses 30 6. Assessing Market Need and Opportunity 42 7. Conclusions & Short List Employment Opportunities 51 8. Updated Employment Proposals - August 2012 60 ● Fort Halstead : Towards a Development Framework (Employment Opportunities) ● 1. Introduction 1.1 In 2006, RREEF (the real estate investment arm of Deutsche Bank) formed a joint venture (Armstrong (Kent) LLP) with Hines that unconditionally purchased a long leasehold interest in the circa 135 hectare Fort Halstead site from QinetiQ 1. QinetiQ remains the freeholder of the site and also holds a long lease. RREEF has the principal interest in the Armstrong (Kent) LLP vehicle. 1.2 Hines, the Development Manager on behalf of Armstrong (Kent) LLP, had previously made submissions to Sevenoaks DC seeking the inclusion of the Fort Halstead site in the emerging Core Strategy for a mixed use scheme incorporating in the region of 1,000 dwellings. The Council, through the Core Strategy, rejected this option. 1.3 Following the announcement in 17 June 2011 by Dstl of its planned relocation from Fort Halstead to Portsdown West and Porton Down by 2017 there is now both a need and an opportunity to think strategically about the long term future role of Fort Halstead. With this in mind, CBRE has been appointed to work with the Council to look afresh at the long term future planning of Fort Halstead. CBRE has appointed a wider professional team to support and inform their work. The aim is to create a high level Development Framework to provide a vision for Fort Halstead’s future. This Report 1.4 This report provides one of the initial pieces of evidence for CBRE in establishing the principal future opportunities for the site. It tests the site’s capability to deliver future employment opportunities and has been authored by Regeneris Consulting with commercial input from CBRE. This commercial input is vital in ensuring that any proposals that emerge for Fort Halstead are deliverable and viable . The report is structured as follows: • Section 2 explores the current economic role of Fort Halstead, in particular relating to the scale and nature of Dstl’s and QinetiQ’s current employment base. • Section 3 provides a brief economic profile of Sevenoaks district, identifying key employment sectors and trends in employment change. • Section 4 distils existing evidence relating to employment land in Sevenoaks as well as neighbouring areas and the implications for Fort Halstead. The focus here is on the conventional employment land categories of office, industrial and warehousing. • Section 5 considers the potential for other employment uses on Fort Halstead, including the scope for leisure, tourism and retail employment on site. • Section 6 provides a systematic appraisal of possible employment uses. • Section 7 provides emerging conclusions and identifies a possible short list of employment options for Fort Halstead. 1 The total previously developed/developable area of the site is somewhat smaller at circa 41 hectares. Page 1 ● Fort Halstead : Towards a Development Framework (Employment Opportunities) ● A New Concluding Section – August 2012 1.5 The CBRE-led team has engaged in a wide programme of stakeholder consultation in the period from May 2012 onwards. One of the aims of the consultation programme has been to test the findings of this Employment Opportunities Report and to gather further views and opinions on possible employment uses for the site. 1.6 A new concluding section to this report has therefore been produced as of August 2012. The new section provides an overview of stakeholder responses on employment land issues and illustrates how the CBRE-led team has incorporated this feedback into a broad strategic masterplan for the site. Page 2 ● Fort Halstead : Towards a Development Framework (Employment Opportunities) ● 2. The Current and Immediate Future Economic Role of Fort Halstead Current on-site employment 2.1 Fort Halstead represents a key employment location within Sevenoaks district. At its peak the site employed around 4,000 people. Various reductions to this figure over the past few decades have brought the current employment on-site to around 1,200 people 2. The breakdown of onsite employment is understood to be as follows: • 830 staff within Dstl. The occupational profile of research activities across the UK 3 suggest that the majority of employees (80%) at Dstl will be employed in higher level positions: Manager and Senior Officials, Professional Occupations and Associate Professional and Technical Occupations. The majority are also likely to be full time positions. • Around 200 employees at QinetiQ, a private sector defence research organisation. As with Dstl it is likely that the majority of QinetiQ employees will be in higher level, full time positions. • Around 150 other on-site employees. Many of these staff are employed by Serco on a range of site maintenance functions. The number also includes a reasonably significant on site security presence. 2.2 The site originally served as one of ring of forts protecting London in the latter part of the 1800s. It was first used as a significant employment site for government research during the Second World War with activity peaking in 1960s-70s. The presence of many of today’s functions on site can be traced back to this period. Travel to work patterns 2.3 Fort Halstead draws in labour from a very wide catchment. Data provided to us suggests that only around 150 of Dstl’s staffing quota (18%) live in the district of Sevenoaks (see Figure 2-1). 2.4 Assuming the same proportion of employees at QinetiQ and Serco 4 live in Sevenoaks as for Dstl, it is estimated that 210 employees on the Fort Halstead site live in the district in total. 2 This figure will be slightly less than 1,200 when converted to Full Time Equivalent employment, although we understand the majority of on-site posts to be full time. 3 Based on SIC/SOC data from ONS, Census 2001 4 Travel to work patterns for Serco staff may be slightly more localised given their occupational profile. Page 3 ● Fort Halstead : Towards a Development Framework (Employment Opportunities) ● Figure 2-1 : Profile of Dstl Employees by Residential Postcode Source: Employee postcode data provided by Dstl Off-Site Employment in Sevenoaks 2.5 As with all major employers, Dstl, QinetiQ and Serco will have considerable corporate supply chains, predominantly focused around central government procurement schedules – this yields what are known as indirect jobs. Staff will also spend their wages in the local economy – known as induced jobs. By applying a combined indirect and induced industry multipliers for a district and economy the size of Sevenoaks (1.05 would be typical) to the employment at Fort Halstead we estimate that occupiers and their employees will support a maximum of 60 off site jobs in the district. 2.6 Dstl has provided some local corporate spend data spend, which amounts to just under £1m (£900k) per annum with local suppliers. Utilising average turnover per employee data to this data would imply an additional 10 off-site jobs in the Sevenoaks economy. The variation in the two approaches is likely to be as a result of: • Degree of accuracy of the estimated local spend from Dstl (it is likely that this data is only partial) • The absence of QinetiQ and Serco corporate spend data • The exclusion of employee expenditure (induced) effects. 2.7 It is unlikely that even when these additional categories are included the off-site employment estimate would exceed the figure derived from industry guidance (i.e. 60 jobs). The procurement patterns of major organisations like Dstl and QinetiQ and the wide travel to work patterns at the site will both serve to limit the degree of off-site activity locally. Page 4 ● Fort Halstead : Towards a Development Framework (Employment Opportunities) ● Dstl Relocation 2.8 Dstl announced their relocation from Fort Halstead to Porton Down and Portsdown West in June 2011. The relocation is expected to be completed in 2017 and is likely to be phased. Related services provided by Serco/others will no longer be required on the site. As a result on site employment will decrease by around 1,000 jobs by 2017. 2.9 At this time it is not possible to ascertain how many of the estimated 150 Dstl employees who live in Sevenoaks will relocate their homes to Porton Down and Portsdown West. It is likely that a proportion of the 150 current employees who live in Sevenoaks will remain living and/or working in the district. 2.10 The employment impacts on the local supply chain will depend on the exposure of individual suppliers to Dstl spend. For a small number Dstl spend will represent a high proportion of annual turnover and may lead to a re-evaluation of their continued operations. Others will be able to adjust through other client contracts. QinetiQ’s Future Role on site 2.11 Our understanding is that QinetiQ propose to continue operations at Fort Halstead. All future on-site operations are likely to take place in two buildings: the existing X48 building and a new 3,300sqm office block. This will safeguard circa 200 jobs. 2.12 Associated open space and landscaping will be required by QinetiQ but the extent of this is not yet known.