< Previous10 East Midlands Business Link www.eastmidlandsbusinesslink.co.ukFINANCE NEWSGeoSLAM maps out growth after £5.4m investment Nottingham-based mapping company, GeoSLAM, has received a £5.4 million investment to support a merger transaction with 3D Laser Mapping, and further evolve its 3D mobile mapping and monitoring technology. The cash injection, provided by Frontier Development Capital and Clydesdale Bank, will also see the firm significantly accelerate the development and marketing of new products to international markets. Best known for its range of hand-held laser 3D mapping devices and accompanying software systems, GeoSLAM’s products are used across the globe to survey complex environments such as mines, tunnels and caves. The company has experienced strong growth since its launch in 2012 and now sells its technology to over 80 distributors in more than 60 countries. Shelley Copsey, CEO at GeoSLAM, said: “We are an incredibly ambitious organisation and our recent merger, supported by this investment, has meant we are now able to use our combined experience in international distribution, innovation and R&D to deliver the next generation of products to clients in an incredibly wide portfolio of industries. Nottingham telematics firm drives expansion with new funding Microlise, the commercial vehicle telematics provider, has refinanced its banking facilities with HSBC UK to support product development, international expansion and job growth. The finance includes a £2.5 million Revolving Credit Facility, which will be used to provide working capital for product development and job creation. Microlise expects to grow its turnover from £51 million to £60 million by 2020. Microlise specialises in telematics, a technology to monitor vehicle performance, driver behaviour and vehicle location. The business currently operates in India, Australia, France, the USA and the UK. HSBC UK’s global footprint will enable Microlise to streamline its international banking requirements in these regions. Bill Wynn, Chief Financial Officer at Microlise, commented: “From the initial engagement, we’ve received first class support from Phil Carr, Jack Coley and their colleagues at HSBC UK. Being a global organisation, we have banking needs across multiple countries and the guidance we’ve received from both the bank’s UK and local teams has made this process painless.” Roger Pratt, HSBC UK Area Director for Corporate Banking, said: “Microlise came to us with a requirement for a seamless financial provision across its market regions and we delivered a finance package in line with the business’s ambitious expansion plans. We look forward to working with the team at Microlise as they embark on this exciting growth period.” In addition to the Revovling Credit Facility, HSBC UK provided further finance to support the business’ shareholder reorganisation. Microlise’s switch to HSBC UK was led by Relationship Directors Phil Carr and Jack Coley, and supported by Peter Bate, Stuart Sewell and Neil Mistry of KPMG, Graham Elsworth, Vinod Patel and Richard Rose of BDO, Richard Underwood of Legal Clarity, and David Doogan of Pinsent Mason. Enterprise loans invests £2m into East Midlands Economy Business support and funding provider Enterprise Loans East Midlands (ELEM) has invested more than £2 million pounds into the economy after being awarded its largest ever funding pot by the British Business Bank last year. Enterprise Loans successfully won a competitive tender for the Midlands Engine Investment Fund (MEIF) – delivered by the British Business Bank – to provide loans of between £25,000 to £150,000 to support the growth ambitions of businesses across the East and South East Midlands region. Since September 2017 the ethical loan provider has lent £1,172,500 from the MEIF and £967,500 from ELEM funding, resulting in an impressive £2,140,000 being pumped into the local economy. This funding has supported 26 businesses and created or safeguarded 231 jobs. Quammar Zamman, CEO at Enterprise Loans, said: “Thanks to the MEIF funding we’ve been able to support even more fantastic businesses and budding entrepreneurs across a number of sectors. Small businesses are the backbone of this country and we’re passionate about helping people to grow and develop their companies. “It’s more apparent than ever that Midlands’ businesses need support to flourish. Whether they need funding and advice or help getting started, investing in new premises or equipment, we are here to support them.” Grant Peggie, director at British Business Bank, commented: “We’re delighted to see Enterprise Loans reach this milestone figure of investments made, successfully deploying small business loans across the East and South East Midlands. Increasing the opportunities available to smaller businesses looking to scale-up is exactly what the fund was set up to do and we would encourage other small growing businesses to consider applying for funding.” 10-11.qxp_Layout 1 04/01/2019 09:28 Page 1www.eastmidlandsbusinesslink.co.ukEast Midlands Business Link 11 FINANCE NEWSMW Polymers secures £200k grant MW Polymers, a manufacturer of sealants, adhesives and coatings for pipeline industries, has won an innovation grant of over £200k. The funding is provided by Government body Innovate UK and will support a collaborative Knowledge Transfer Partnership (KTP) project between MW Polymers and Aston University. The aim of a KTP project is to exchange knowledge three-ways between the business, the University and the graduate. This supports areas of potential growth for the business, develops stronger industry ties for the University and allows the graduate to further their work in a specialist field. Mike Wild, Founder and Managing Director of MW Polymers, said: “Securing funding from Innovate UK is a great result. It will enable us to work with the brightest minds in the field of advanced materials. By the end of the project, we’re confident we will have an innovative product suitable for industry.” The project will commence at the beginning of January 2019 and will see the appointment of a new Polymer Scientist to the MW Polymers team. They will be responsible for developing a new polymeric material with the support of MW Polymers and the Aston Institute of Materials Research (AIMR), which is led by Professor Paul Topham. Speaking on the project, Professor Topham said: “This is an exciting project for Aston University to be part of. Aside from developing a new advanced material, we will have the opportunity to build stronger industry links through MW Polymers, which will benefit our students. In addition, it will enable Aston University to maintain its position as a leader in advanced materials research.” By the end of the two-year project, it is envisaged the company will have gained invaluable insight into advanced materials, built stronger ties with Aston University and Innovate UK and will have a commercially viable product ready for market. Government confirms £10m grant for Ashton Green A government grant of £10million is to fund new roads that will help unlock further development at Leicester City Council’s Ashton Green housing site. News that the council would receive the grant was first announced back in February, but Homes England has now confirmed that the funding is on its way. The funding will be used to construct around 3km of key spine roads, which will open up around 40 hectares of development land and pave the way for a further 1,080 homes and a mixed-use village centre. City Mayor Peter Soulsby said: “Confirmation of this funding means that we will be able to accelerate the delivery of this important development in Leicester. “The funding will unlock 40 hectares of development land and the building of more than 1,000 new homes. “Off the back of this funding we will see developers of the next parcels of land invest an additional £150 million over the next five years. “Ashton Green is already making a significant contribution to the number of new homes that are needed in Leicester – and it will ultimately contribute greatly to the economic growth of the city.” Work on the new roads is due to start in August 2019. Leicester’s project was one of 133 council-led schemes across the country to successfully bid for a share of the Housing Infrastructure Fund, which aims to make housing developments viable and get new homes built more quickly. Funding is awarded to local authorities on a highly competitive basis. The £10 million of grant funding for Ashton Green was first announced in February 2018. Chancellor of the Exchequer Philip Hammond and Secretary of State for Communities and Local Government Sajid Javid met Leicester’s City Mayor Sir Peter Soulsby at Ashton Green to make the announcement. Leicester City Council is the principal landowner and promoter of the Ashton Green development, which is a mixed use urban extension on a 130 hectare greenfield site to the north of Leicester. £12.69m acquisition financing secured for open-air shopping centre HFF Real Estate Limited (HFF) is providing £12.69 million in acquisition financing for Vicar Lane, a 216,790-square-foot, open-air shopping centre in Chesterfield. The HFF team worked on behalf of the borrower, ALTERIS to place the five-year, fixed rate loan with AgFe. Vicar Lane was completed in 2000 as a purpose-built, open-air centre with views of the famous crooked spire of Chesterfield’s Church of St Mary and All Saints, which draws more than three million day trippers visiting annually. Anchored by TJ Hughes and H&M, the 95-percent-leased centre is also home to River Island, Iceland JD Sports, New Look, Superdrug, Deichmann, Waterstones, Holland & Barrett, Clydesdale Bank, O2 and Three Store. The HFF debt placement team working on behalf of ALTERIS included managing director Edward Daubeney. “This transaction proves there is demand for well-let retail opportunities with ongoing tenant demand and a good future,” Daubeney said. 10-11.qxp_Layout 1 04/01/2019 09:28 Page 212 East Midlands Business Link www.eastmidlandsbusinesslink.co.ukMANUFACTURING NEWSRolls-Royce signs contract with Middle East Airlines Rolls Royce has signed a $300 million deal with Middle East Airlines to provide engines and support to a new fleet of aircraft. Air Liban (MEA) has decided to purchase four new and two option Airbus A330-900neo powered by Rolls-Royce Trent 7000 engines due to deliver in 2021. The contract covers long-term engine maintenance services, throughout the operation of the engine with MEA, the purchase of spare engines and supply of parts. The contract was signed during the Lebanon-UK Business and Investment Forum in London by MEA Chairman – Director General Mohamad El-Hout and Rolls-Royce Chairman Ian Davis and witnessed by the Prime Minister of Lebanon, His Excellency Mr Saad Hariri and the Rt. Honourable Alistair Burt, UK Minister of State for International Development and Minister of State for the Middle East. Rolls-Royce will deliver the latest engine in its Trent range, the Trent 7000, along with its flagship TotalCare® support service. The Trent 7000 is part of a Trent family that has now accumulated more than 125 million engine flying hours. Mr El-Hout said: “We are committed to ensuring our airline is at the leading-edge in terms of using technology to provide excellent customer service and performance. Our new aircraft, and their latest-generation Trent 7000 engines, will deliver on that goal.” Factory unveils new hi-tech equipment and jobs An Ilkeston company which makes aluminium products for the building industry has unveiled its latest state-of-the-art investment. Dales Fabrications has installed a polyester powder coating plant which applies attractive hard-wearing finishes to the aluminium products it manufactures at its factory in Crompton Road. Industry specialists and Erewash MP Maggie Throup were among guests who attending the unveiling last year. Karl Prosser, managing director of Dales, said the new equipment, costing £170,000, is a massive upgrade of a limited capacity that the company had up to now and will will help speed up the process. The cost includes a grant of £42,500 from a Government fund managed by the University of Derby that provides loans and grants to businesses across the East Midlands which are looking to grow. This is because the company is creating two jobs with another two expected to follow in the next couple of years. Under the scheme the university will offer other services such as apprenticeships, knowledge exchange, research and product testing as part of a continuing relationship. Dales has received endorsement from Syntha Pulvin, a multi-national company that provides the powder products. Dales is one of only 26 companies in Britain to have this approval. Manufacturing outlook deteriorates as uncertainty continues to bite The outlook for Britain’s manufacturers is deteriorating on the back of a cocktail of factors related to Brexit uncertainty, weaker global growth and the impact of protectionist policies according to a major survey published today by EEF the manufacturers’ organisation and business advisory firm BDO LLP. According to the Q4 EEF/BDO Manufacturing Outlook survey, while output and orders remain positive there has been a clear moderation in the strength of balances throughout the course of 2018, a trend which has accelerated in the final quarter. In particular, there has been a clear divergence in the last quarter between domestic and export orders, with the domestic picture backing anecdotal evidence that companies are putting in plans to increase inventory levels ahead of the UK’s exit from the EU. In contrast exports which have boosted the manufacturing sector over the last few years appear to have hit the brakes. Commenting, Stephen Phipson, Chief Executive of EEF, said: “The moderation in manufacturing performance over the course of this year appears to have gathered pace during the final quarter with more clouds on the horizon than there have been for some time. “This should come as no surprise given the significant political uncertainty at home which is why it is essential that there is an agreement for the UK’s withdrawal as soon as possible. If everything that can go right does then business and consumer confidence should hopefully gather some steam next year with improved prospects for growth. That’s the backdrop we’re working to, let’s hope it’s the right one.” Tom Lawton, Head of Manufacturing at BDO added: “Manufacturers have remained reasonably confident over the course of the year but the sharp decline in export orders is a real cause for concern.” © SHUTTERSTOCK.COM / SASINTIPCHAI12-13.qxp_Layout 1 04/01/2019 09:29 Page 1www.eastmidlandsbusinesslink.co.ukEast Midlands Business Link 13MANUFACTURING NEWSManufacturers call for boost to UK Occupational Health capability Britain’s manufacturers are urging the Government to use its review Occupational Health (OH) provision in the UK to ensure all companies have access to an OH service as part of a much wider overarching strategy for tackling more than just work-related sickness absence. The call comes on the back of a major survey of Work and Health by EEF, the manufacturers’ organisation and specialist insurance broker Howden. It shows that whilst the vast majority of employers are providing their employees with access to OH services, many are still not recording work related absence or are unclear about whether their risk control measures and OH management have an impact on the number of cases of work-related ill-health. The survey also shows that waiting time for medical surgery/investigation, tests and recovery from surgery remains the biggest cause of work-related absence followed by stress. Both of these have been heading higher in EEF’s three previous surveys since 2009 whilst other health conditions such as back problems, heart conditions and cancer have either plateaued or declined. Terry Woolmer, Head of Health & Safety Policy at EEF said: “It has long been recognised that a healthy workforce is a more productive workforce. Investment in the wellbeing of employees by both the employer and Government makes sense not just for good business practice but also the benefits to wider society from reduced benefits and pressure on a stretched NHS system.” © SHUTTERSTOCK.COM / INDYPENDENZ© SHUTTERSTOCK.COM / DMITRY KALINOVSKYRolec expansion creates 50 new jobs in Boston Boston-based Rolec Services Ltd, specialists in the manufacture of outdoor electrical equipment, have announced the opening of a new factory complex at Haven Business Park, creating 50 full-time jobs. The production facility has been developed to focus on the manufacture of Rolec’s electric vehicle charge point range. The new Haven Business Park factory will complement Rolec’s existing head office, stores, factory and showroom in Ralph’s Lane, Wyberton – which already employs more than 100 people, taking Rolec’s total staffing levels to more than 150. Kieron Alsop, Managing Director of Rolec, said: “We are delighted to be in a position to further expand our operations in Boston, with the introduction of a purpose-designed factory complex dedicated to the manufacture of EV charging points. “We will continue to manufacture our existing range of products for the caravan, marina and outdoor power solutions industries at Ralph’s Lane, a site we are also planning to expand in the near future.” Rolls-Royce to transfer design approval from Derby to Germany As Rolls-Royce releases its latest trading update it also warns it is set to transfer design approval for large aero engines to Germany, as part of its Brexit contingency plans The firm says: “Rolls-Royce notes the decision by the UK Government to delay the vote on the proposed Withdrawal Agreement and political declaration. We will continue to implement our contingency plans until we are certain that a deal and transition period has been agreed. “Specifically, we are working with EASA to transfer design approval for large aero engines to Germany, where we already carry out this process for business jets. This is a precautionary and reversible technical action which we do not anticipate will lead to the transfer of any jobs. “We have begun to build inventory as a contingency measure, in line with the timetable that we gave in the summer. We have been liaising with all our suppliers and have reviewed our logistics options and have the required capacity available. At this point we have contingency plans in place and will update the market when we have clearer visibility.” On the firm’s performance it reports it expects profits for the 2018 to be in the upper half of its full year guidance, which has previously been forecast to fall between £400m and a loss of £100m operating profit. “The strong large engine flying hour growth we reported in the first half has continued into the second half of the year. As guided previously, we expect full year growth to be in the mid-teens range. “As indicated in our statement on 26 October 2018, we expect to deliver around 500 large engines to our customers in 2018, lower than our March 2018 engine projection of around 550 large engines.” 12-13.qxp_Layout 1 04/01/2019 09:29 Page 214 East Midlands Business Link www.eastmidlandsbusinesslink.co.ukPROPERTY NEWSMajor Derbyshire warehouse let to shipping group On behalf of Aberdeen Standard Investments, Knight Frank and JLL have let a large 141,459 sq ft distribution warehouse in Swadlincote. The building, known as Tetron 141, has been taken by logistics business Jenkins Shipping Group Limited on a five-year lease agreement at an annual rent of £5.75 per sq ft. Formed 35 years ago, Jenkins Shipping is an independent, owner-managed business and one of the UK and Ireland’s market-leading logistics specialists. It has leased the Derbyshire premises to enable it to service a new contract. James Clements, head of Knight Frank Midlands’ Logistics & Industrial said: “We are delighted to have secured Jenkins Shipping Group in Swadlincote. The previous tenant vacated the building five months ago so to have identified and agreed terms with another occupier so quickly is proof of the lack of Grade A accommodation available in the immediate market.” Other local occupiers near to Tetron 141 include Bison, Clipper Logistics, Roger Bullivant and TNT. Aberdeen Standard Investments was represented by Knight Frank and JLL. Jenkins Shipping Group was represented by CBRE. CPP secures eight occupiers for Markham Vale site Commercial property consultancy Commercial Property Partners LLP (CPP) has completed a further three deals in the last two months at Wilson Business Park, securing a total of eight sales for the flagship business park based in Chesterfield, Derbyshire. GB Bespoke Joinery has purchased a 2,300 sq ft unit on the site which will form its new HQ, where it will manufacture joinery products for its nationwide contract projects. LTEK Systems, who manufacture control systems, has purchased Unit 11, totalling 1,250 sq ft, and motorcycle expedition company Globebusters have also secured a unit of the same size. A further unit has been purchased by a private investor and subsequently let to Switch Electrical Supplies. The latest occupants to the scheme join the wider Markham Vale site, alongside businesses including Direct Track Solutions, Shotblast Solutions, Magpie Beauty & Catering Projects – negotiated by CPP earlier this year. Stuart Waite, partner at CPP commented: “We are delighted to have completed further sales, and additional lettings, on the park, demonstrating a resilient demand for small industrial units, especially those that are available to buy. “The site is now well-established as ideal premises for any business looking for accommodation in the region – and boasts an exceptional location and key transport links. We’d encourage anyone who is interested in space at Wilson Park to contact us directly.” Lee Gent, from GB Bespoke Joinery added: “The quality of the units at Wilson Business Park is outstanding, and the surrounding transport links mean excellent access to the surrounding cities, and beyond. We are looking forward to moving into our unit and continuing to grow our business.” Wilson Business Park forms part of the wider Markham Vale regeneration area. First phase of £70m investment complete at Symmetry Park National logistics developer db symmetry has completed the first 150,000 sq ft logistics building at Symmetry Park at Blyth as part of an overall £70 million investment into the region. The speculative venture is the first in the region by db symmetry, which is one of the UK’s biggest developers of prime logistics accommodation with nearly 4,000 acres of land in its portfolio. Recognising a geographical shift in demand for space in the north by occupiers due to accessibility and labour resource, db symmetry is confidently expanding its portfolio with deals in lawyers’ hands to double its current 140-acre landbank in the region by the end of the year. Symmetry Park is prominently located at Junction 34 of the A1 and adjacent to Blyth services on the North Nottinghamshire/south Yorkshire border. db symmetry has consent and is committed to deliver up to 721,000 sq ft of logistics space on the park and has already agreed deals for Euro Garages to deliver a branded fast food restaurant and coffee shop and Irizar to build a luxury coach showroom at the entrance to the site. Andrew Dickman, Director at db symmetry said: “We are a cautious developer that is selective on speculative development. Our decision to speculatively build at Symmetry Park comes at a time when there is a strong level of demand but limited availability of high-quality logistics space in the north.” 14-15.qxp_Layout 1 04/01/2019 09:32 Page 1www.eastmidlandsbusinesslink.co.ukPROPERTY NEWSMorgan Sindall chosen for £24m student scheme Vita Group has chosen Morgan Sindall Construction & Infrastructure to deliver its second Vita Student scheme in the Midlands. Work on the £24 million development, located on Station Street in Nottingham, is now underway with the project expected to complete in time for the new academic year in 2020. The main contractor is also building the only other Vita Scheme in the Midlands, Vita Birmingham, which topped out in October (2018). The construction company is delivering both projects through the Vita framework, which it was appointed to earlier this year. Designed by architect Fuse Studios, the 101,375 sq ft development will benefit from excellent connectivity, being situated next to Nottingham train station. Sharing the same modern aesthetic of all Vita schemes, the building is split into three tiered towers of six, eight and ten storeys each, housing 319 apartments. Almost 6,000 sq ft has been designated as communal hub space for collaboration and socialising. There will also be a coffee bar, separate study rooms and private, bookable lounges. St. Modwen start work on third construction phase at Burton Gateway Developer and regeneration specialist, St. Modwen, have begun work on the third phase of construction at its 1 million sq ft industrial and logistics site, Burton Gateway. The news follows a successful planning application, which was granted consent by East Staffordshire Borough Council in August for a further 103,000 sq ft distribution unit, which will be completed in August 2019 and is anticipated to create a further 120 local jobs for the community. The distribution unit will be built to a high-quality specification and include a 50m deep yard, 10 dock levellers (including 2 euro-docks) as well as office space. The new unit will be the latest addition at Burton Gateway where three units, totalling 120,000 sq ft, were completed last month as part of the scheme’s second phase. St. Modwen’s latest build further contributes to the developer’s intention to double the footprint of its industrial and logistics sites across the Midlands and North region. Burton Gateway is one of the largest warehouse developments in the Midlands. It is already home to Hellmann Worldwide Logistics, who last year took a 10-year lease on a speculatively developed 87,000 sq ft building on the site. £8.96m four-storey office to be built in Derby A new £8.96 million four-storey city centre office is to be constructed by the Council at One Cathedral Green on Full Street to satisfy continued demand from businesses. The new office, with basement car parking is planned to be delivered by autumn 2020 and the whole building will be let as an innovative model of managed workspace. The Council has agreed a deal with developers Wilson Bowden who own the site and a third party who has agreed to take a lease of the whole Grade A office building. The investment from the Council also enables the simultaneous construction on the same site of new offices for UNITE the Union who will be buying the adjoining building for a new regional headquarters. When complete, the entire development will safeguard existing jobs and create as many as 180 new city centre jobs. The Council, as part of its regeneration strategy, has decided to take this step as additional Grade A office development is needed to increase business confidence and commerce in the city centre. East Midlands Business Link 15 14-15.qxp_Layout 1 04/01/2019 09:32 Page 216 East Midlands Business Link www.eastmidlandsbusinesslink.co.uk2019 PREDICTIONSIt’s that time of year, when East Midlands Business Link Magazine invites readers to offer up their forecasts for the year ahead. It has become something of a tradition, given that we’ve been doing this for almost 35 years. And, while none of us possess a crystal ball, it is uncanny how accurate some of these forecasts have been over the years. © SHUTTERSTOCK.COM / ELNUR It’s that time of year, when East Midlands Business Link Magazine invites readers to offer up their forecasts for the year ahead. It has become something of a tradition, given that we’ve been doing this for almost 35 years. And, while none of us possess a crystal ball, it is uncanny how accurate some of these forecasts have been over the years. Looking forwardLooking forward16-19.qxp_Layout 1 04/01/2019 16:16 Page 1www.eastmidlandsbusinesslink.co.ukEast Midlands Business Link 17 2019 PREDICTIONSJames Pinchbeck, Marketing Partner at Streets Chartered Accountants For me the 1st quarter of 2019 will not only set the scene for the UK for the whole year, but for decades to come. As we ended 2018 seemingly no nearer to getting a Brexit deal, the likelihood of a no deal seems increasingly inevitable. Whatever the outcome, our relationship with Europe is bound to be strained. Business confidence seems to be waning too. Though we still see many businesses, despite uncertainty, making capital investments or looking at business improvements. The focus for many being to improve productivity, supply chain, enhance margins and increase capacity. As 2018 ended, we again received profit and sales warnings for high street retailers. Looking to the year ahead no doubt we continue to see the demise of more not just of long established high street stores, but independents too. Whilst seemingly we are not spending less, the way we buy and what we choose to spend our money on is changing. Certainly more of us are looking to spend money on more experiential leisure activity as opposed more material items. In terms of Greater Lincolnshire, we have seen a real growth in new technology led businesses, with many young entrepreneurs opting for self employment as employment. This is a trend we envisage continuing in 2019 as the growing cluster of tech entrepreneurs create a vibrant environment for them to start, sustain and grow. Lewis Stringer, Senior Manager, UK Network Team – East & South-East Midlands, at British Business Bank Having transferred into the Bank’s newly established UK Network Team, my role at the British Business Bank now has an extended remit. The UK Network Team will help enhance business finance ecosystems across the UK so smaller businesses, wherever they are, can grow and prosper. The Team will also help the Bank develop a deeper understanding of small business finance markets in all parts of the UK so that, ultimately, the Bank can improve its support to smaller businesses everywhere. This enhanced role will build on the early success of the Midlands Engine Investment Fund in the East Midlands into 2019 and beyond. Addressing the disparities that exist between the East Midlands and the rest of the UK is my key message for 2019. Unfortunately, regional disparities are not limited to access to finance. Whilst employment growth is forecast to match the UK as a whole, the East Midlands is expected to be among the UK’s weaker regions for productivity growth over the next three years. Productivity growth will be as important as employment growth in 2019. A significant shift in the labour market is likely due to a slowing economy, expected reduction in immigration and technological change. There is no doubt that the East Midlands saw a significant slowdown in both economic growth and investment activity in 2018. My concern is that the East Midlands is losing out to other regions, particularly those that have secured devolved powers from central government. The region’s weaker performance just strengthens the case for driving deeper geographic rebalancing to maximise the undoubted potential of the East Midlands. This is already being recognised by the Bank. The region’s core cities – Derby, Leicester and Nottingham – are likely to continue to be outperformed by the UK’s larger cities. These core cites need to step-up as key economic drivers for the East Midlands. As a smaller region, the East Midlands will be more vulnerable to inevitable economic downturns in 2019. Therefore, it is critical that business and civic leaders start to develop actions now that will to help drive greater economic activity across the region. 16-19.qxp_Layout 1 04/01/2019 16:16 Page 218 East Midlands Business Link www.eastmidlandsbusinesslink.co.uk2019 PREDICTIONSAnn Bhatti, Head of Connect Derby It’s impossible to predict what 2019 will bring for businesses without being influenced by the continued uncertainty of Brexit. As we head into the New Year and with Britain set to leave the EU on the 29th March, there are many unanswered questions hanging in the air. I think the main concern for businesses is the kind of deal we’ll leave with and what it will mean if we don’t strike a good deal. It will also be interesting to see if on-going talks about a second referendum come to fruition. The uncertainty that Brexit brought about in 2018 leaves us wondering what the impact will be on our economy. I believe this is making businesses nervous and extremely cautious in their business transactions. On a more positive note, the development of Infinity Park Derby since Derby City Council’s agreement with the Nuclear Advanced Manufacturing Research Centre (NAMRC) is set to bring £3.5m investment and 18 new jobs to the city over the next two years. This will add another notch to Derby’s global reputation as the UK’s Number 1 city for innovation. Recognised to be at the heart of the country’s aerospace, rail and automotive sectors, Derby will now be adding nuclear research to its portfolio. There are exciting things coming to Derby city centre, too, with plans for vibrant office space at Cathedral Green and the Bold Lane site attracting larger, more established businesses to the city centre. Pat Doody, Director, Business and Commercial Banking at NatWest Bank, Lincolnshire Harold Wilson once famously quipped that a week is long time in politics. If so, 2019 will feel like a very long year, as the outlook is dominated by politics. Whether Brexit, protectionism or EU member states budget agreements, in 2019, financial markets and the economy will be shaped even more than usually by politics. Although these ‘Big Macro’ themes will dominate, we shouldn’t overlook other, less obvious but perhaps more powerful forces. Demographic change and an ageing population will continue to reshape the consumer landscape. Older households will continue to acquire consumption capital, or the capacity to spend. They are the only cohort who have enjoyed a constant increase in their spending. And they, like all ages, are increasingly choosing to spend their money on experiences over things. We all spending more on holidays, leisure, eating out, sports and exercise, pets and recreation. Acquiring and sharing experiences and memories are the new goods. Similarly, firms will continue to invest more in intellectual assets like Software, Data, Designs, R&D & Branding. Revenue and income will increasingly come from how we advise and consult, offering specialisms and targeted, knowledge-rich, support. The East Midlands is well paced to harness this. Over the past few years the strongest growth areas have not been the richest, like Surrey. It seems the new growth area is a new ‘golden triangle’, that stretches north from London to B’ham, then across to Bristol and back east to London. It captures Oxford, Cambridge, MK and Reading. But the East Midlands too. We should be prepared for a growing population and more knowledge based business and the high skilled specialists who work in them. They’ll be wanting to spend money too – just not necessarily on things (except housing of course). 16-19.qxp_Layout 1 04/01/2019 16:16 Page 3www.eastmidlandsbusinesslink.co.ukEast Midlands Business Link 192019 PREDICTIONSKrista Fox, PKF Cooper Parry Tax Partner, and Andy Parker, Cooper Parry Corporate Finance Partner One certainty is that there will be tax changes in 2019. And with the recent tightening up of the Entrepreneurs’ Relief criteria, could further tax changes be on the horizon that may limit this valuable relief? With potential buyers in the global market, the timing may be right for business owners to consider an exit. What will next year bring in the M&A market? To Brexit or not to Brexit? The terms in which we leave the European Union on March 31st will no doubt have an impact on Mergers & Acquisitions (M&A) and investments. But what can we glean from the present and past to help us make predictions for next year? Investment from the US North America will continue to invest in the UK and buy businesses. The slump in the pound’s value makes us an attractive place to invest, as does our language. The US can also trust our legal system, and we’re still the fifth biggest economy in the world. In summary, still look for 50% of mid-market deals to involve overseas businesses, mainly from North America. This year, we’ve completed deals Groupe Solotech INC of Canada, which acquired SSE Audio Group. We also advised the Shareholders of Blink Medical as they were acquired by US Private Equity (PE) backed Katena Products. Elsewhere in the world Northern Europe still see us as similar and a good business environment. Businesses are still investing in the UK. Southern Europe has many of its own challenges – they see the UK as a contributor to these challenges – and may sit things out for a while on the investment front. When it comes to the Asia-Pacific, Japan may consolidate on existing investment. China will look hard but may take too long and miss opportunities. I’d watch out for new buyers from India. Earlier this year, we advised the shareholders of Edina Power Solutions Limited as it was acquired by EPAL, a joint venture involving the Ministry of Power, Government of India. Investors and the banks Investors still have lots of money and want to invest. PE will be involved in 50% of the mid-market deals. In terms of the banks, despite the rubbish thrown at the Governor of the Bank of England by Brexiteers, he’s done a fantastic job stopping the worst impacts of the referendum vote. He’s ensured that the UK banks are robust and can sustain significant stresses likely to come from Brexit. Banks will continue to lend to sound businesses, but some of the “zombie” businesses may lose support and we could see an uplift in distressed business sales. James Hartley, Director of North Sands Developments As a company, North Sands Developments ended 2018 on a high with strong interest in our housing schemes and a number of houses going under offer. We expect this level of interest to continue into the new year. This won’t necessarily be true for the whole of the property market, which can fluctuate greatly in times of political uncertainty. Once there is a clear economical plan concerning Brexit, I think confidence will increase and we will see fresh demand within the housing sector. I don’t think the early part of the year will see a huge rise in house prices, but we will see a significant rise in interest levels which will be reflected in increased prices as the year progresses. In fact, I believe the first few months of 2019 will be the best time to act as a purchaser. Once the Brexit handbrake is released, I think a new wave of positivity will hit the property market and this will continue to build throughout the year. North Sands Developments is certainly looking forward to securing new acquisitions in 2019 with a view to having a new scheme under construction by early summer. This will coincide with a number of developments nearing completion in Nottingham, such as around Trent basin, the River Trent, Edwalton and West Bridgford. My advice for 2019 is – if you are thinking of moving this year, move early before prices increase.16-19.qxp_Layout 1 04/01/2019 16:16 Page 4Next >