Why Cambridge is well placed to buck a Brexit slowdown
With Brexit decisions just around the corner several questions have been raised regarding the future of the UK as a global business location, writes Rob Sadler, head of Savills’ Cambridge office.
There remains little indication of what a deal might look like at this stage, however despite uncertainty Cambridge’s future remains brighter than ever before.
The ecosystem that serves Cambridge’s 1,000 plus technology and life sciences companies, which connects entrepreneurs, investors and academics, has been developed over many decades, fostered by strong links to the world famous university as well as a number of high profile medical facilities.
As a result, a number of international and European businesses have made the city their home and while Brexit negotiations have undoubtedly caused unease, several larger firms including AstraZeneca and Arm Holdings have confirmed their long term commitment to Cambridge since the 2016 referendum.
Crucially they aren’t the only ones. At present, Savills is tracking more than a quarter of a million sq ft of requirements from businesses looking to expand within Cambridge, despite what the future may hold.
The amount of corporate investment into the city, including mergers and acquisitions, private equity and venture capital funding, also paints a promising picture.
Since the referendum, the ‘Cambridge Phenomenon’ has driven capital growth value by an average of 7.3 per cent, far exceeding other key regional cities. With £35.43 billion invested in 2016 and 2017 alone, Brexit has clearly had little impact on investor confidence.
Looking forward, Cambridge is also well placed to nurture emerging sectors such as Artificial Intelligence (AI). Samsung, Microsoft and local success story Darktrace have already gone some way to create a growing cluster of both mature and start-up AI developers.
What’s more, with a limited supply of AI experts across the UK, the talent coming out of the University of Cambridge will prove invaluable. For this reason the city is in a good position to take advantage of the Government’s AI Deal, which is set to be worth more than £1 billion.
Overall, Cambridge’s growth prospects remain strong and the fact that the city is not overly reliant on the financial services sector also insulates it from some of the problems impacting other key business centres across the UK.
In order to sustain this growth, Cambridge will need to maintain the delivery of commercial space as well as improving residential affordability. Business expansion is all well and good, but if these businesses have nowhere to go, and their employees have nowhere to live, then it is likely to falter with or without Brexit.
However, with a commitment from central Government and a more localised City Deal in place to try and solve some of these issues, Cambridge is well placed to capitalise – deal or no deal.