Barnet lands largest TIF outside an enterprise zone
0The government has granted permission for the UK’s biggest tax incremental finance scheme outside of an enterprise zone, to help fund the regeneration of London’s Brent Cross.
In this week’s Budget, chancellor George Osborne announced that the government will provide £97m of for half the cost of a new Thameslink station at the site.
And alongside this grant funding, he also gave the go-ahead for a mechanism to ring-fence business rates raised at new retail development from periodic resetting. This will provide the certainty needed for the London Borough of Barnet and Greater London Authority to borrow money to fund the other half of the station’s construction costs.
Speaking to Room151, John Hooton, interim chief operating officer at the council, said: “In the past, it has been a challenge to demonstrate viability on this scheme to get market interest.
“Our plan, on which we worked with the Treasury, means that if you fund a Thameslink station at the site, it helps with the infrastructure needed to deliver the scheme and raises land values in the area.”
The Brent Cross Cricklewood regeneration is aimed at delivering a new town centre of 7,500 new homes, 27,000 jobs and 455,000 square metres of commercial space.
The deal will see the council use extra business rates income from the planned extension of Brent Cross shopping centre to repay the council’s loan.
The exact length of the loan repayments has yet to be decided, he said.
Business rate rises within enterprise zones are automatically protected from the resetting process, meaning greater certainty over future business rates income.
In 2012, Birmingham’s zone announced it would take advantage of this freedom to undertake a £119m TIF scheme. An enterprise zone is also being established in Nine Elms, London, enabling another TIF to help fund the extension of the Northern Line.
Outside of enterprise zones, however, the government has only previously allowed three ring-fenced TIF schemes. In July 2012, it announced three deals for Newcastle (£92m), Sheffield (£33m) and Nottingham (£8m).
Photo (cropped): by Nico Hogg, Flickr
