Research claims HS2 is major boost for West Midlands economy

For the North of England it surely only rubs salt in the wound, but HS2 is already boosting economic prospects for the West Midlands, claims new research.

The Northern leg of the high speed rail project – the branch to Leeds, and the route to Crew then Manchester – were infamously axed by the government; the latter only last year, so the wound is still a little raw.

The West Midlands, meanwhile, can look ahead to an economic uplift of some £10bn over the next decade, according to the research, with the future arrival of HS2 in the region already said to be driving “huge” investor confidence.

Sir Jon Thompson, executive chair at HS2 Ltd, said: “This new research provides evidence that HS2’s future arrival is already driving transformational regeneration and investment in the West Midlands. It shows that investor appetite, regeneration and investment close to where we’re building our three key assets in the region has surged in the last six years.

“Driven by the promise of enhanced connectivity and heightened investor confidence, HS2’s arrival is spreading prosperity and opportunity to the communities it touches for generations to come.”

Andy Street, Mayor of the West Midlands, added: “This research demonstrates that HS2 has delivered substantial investment and development opportunities in our region in recent years.

“Whether it’s urban regeneration, improved local transport connections, increased housing provision and of course new jobs, HS2 is benefiting local people, businesses and our wider economy. It’s vital that local people see the tangible benefits of major schemes like this.”

Economic analysis of the areas close to HS2’s three hubs in the West Midlands – Curzon Street Station in central Birmingham, Interchange Station in Solihull, and the Washwood Heath Depot and Network Integrated Control Centre – is said to show “dramatic increases” in regeneration and investment in the last six years.

Since Royal Assent was granted for the railway in 2017, the number of planning applications seen in a 1.5 mile radius around these three major HS2 hubs has increased by two-thirds, the report says.

Over the same timescale, the area of total planned floorspace – including commercial and residential – has increased by 200%, and the planned number of new homes has increased by almost 500% – from 10,000 to 55,000 homes.

According to research commissioned by HS2, this increase in investment activity far outstrips any rises in planned development outside of HS2’s impact zones, and has occurred despite economic shocks caused by the war in Ukraine and the COVID-19 pandemic.

The rate of increase in planned housing within HS2’s impact area has been 14 times greater than elsewhere in the region, with the uplift in total planned floorspace over four times greater.

Since 2017, the construction value of major new projects in HS2’s three impact zones has increased by 240% – from £4.5bn to £15.4bn. According to HS2 Ltd, this is further evidence of increased investment and activity around the three HS2 hubs.

This building boom is contrary to activity outside of HS2’s impact zones, it says, where the construction value of new planned projects has decreased by 16% in the same period – from £19.3bn to £16.3bn.

The numbers and values of projects since 2017 are also much higher compared to an equivalent period before HS2 was given the green light in Parliament.

Within its three impact zones, it is estimated that HS2 will be responsible for the generation of 41,000 additional homes, 704,000 square metres of new floorspace and 30,835 new jobs.

Putting this in the context of the whole country, since 2017 the West Midlands has been the highest performing attractor of inward investment outside London and the South East, with the number of projects it attracted in 2022/23 second only to the capital.

Main image: Aerial view of HS2’s Curzon Street Station site in central Birmingham

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