Quality of new builds remain slack

Interest rates set to rise on back of growing economy

Industrial proves popular with Savills private clients

£36 million landmark development for city centre

Small developers may be forced out of market

Nestle to axe 645 jobs in York and relocate in Europe

Quality of new builds remain slack

UK housebuliders are still failing on the quality of new builds, according to a new report.

The Commission for Architecture and the Built Environment reveals in its annual report that only six out of eleven major housebuilders have invested in a design champion.

Chief executive Richard Simmons said: "Our schools and housing audits show how much poor design still gets planning permission - evidence that the design champion is not being listened to."

Interest rates set to rise on back of growing economy

The UK economy is set to grow faster than initially anticipated mainly because households are spending more money and consequently interest rates are set to increase, according to a new report.

The Confederation of British Industry (BCI) forecasts that inflation is set to peak at 2.8% in the first quarter of 2007, which increases the chance that the Bank of England (BOE) will raise interest rates by a quarter percent in November. However, GDP growth is expected to return to about 2.5% next year, as world economies slow and the impact of higher interest rates takes effect.

Ian McCafferty, BCI's chief economic advisor says: "At home, consumers have regained some confidence, with higher household spending and average earnings."

Industrial proves popular with Savills private clients

Savills has announced that its private client desk has transacted approx two million sq ft of industrial warehouse space so far this year, equating to 79% of the total £135m traded.

Gary Phillips of Savills’ private client desk says: “In a white-hot market with stiff competition we have secured a number of industrial opportunities and in offering sizeable non-refundable deposits together with rapid exchange of contracts, this has proved a winning formula. In addition, our close relationship with major lenders has led to creative financial restructuring.”

£36 million landmark development for city centre

A £36m regeneration scheme, which is designed to help transform and improve Leeds city centre has got under way.

Proposals for the landmark development, known as 20/20 House, which will be spearheaded by Morris Properties Group, include the construction of 197 deluxe one and two-bedroom apartments, 75 revolutionary micropads, studio apartments and 12,000 square feet of contemporary commercial office space.

Mark Ellis, Morris Properties development director, comments: “20/20 House takes modern, contemporary city centre living to a new dimension. Tenants are becoming increasingly astute and demanding in what they expect from. their living environment. This new development, with its innovative micropod designs and luxury apartments will give residents everything they need to meet the demands of their busy, modern lifestyles.”

20/20 House is situated on the edge of the new urban quarter of Eastgate and Harewood – a £700m development proposal, led by Leeds Partnership, which will transform the northern edge of the city.

Small developers may be forced out of market

The Government will risk driving small developers out of the market and fail to reach its yearly target of 200,000 new homes if it goes ahead with the proposed Planning-gain Supplement (PGS), according to new research commissioned by RICS.

The proposed land tax will leave small developers with little operating profit margin, resulting in them having no option but to either opt for more profitable ventures or leave the residential new-build market altogether.  First-time buyers and families looking to trade-up to larger premises will feel the knock-on effect as the property market remains constricted with demand far outstripping supply.

RICS head of policy, Brian Berry: “This is a prime example of the government shooting itself in the foot. The research clearly demonstrates that PGS fails to achieve the Government's stated objective to raise additional money for infrastructure. The mechanics are flawed and need to be reworked.

A higher tax burden on smaller developers along with funding shortfalls for necessary infrastructure for larger schemes (such as the Thames Gateway), will reduce the amount of proposed housing development, doing little to resolve the huge problem of housing affordability for first-time buyers.”

Nestle to axe 645 jobs in York and relocate in Europe

Nestle is to axe 645 jobs at its biggest British chocolate factory in York, next year. The firm said that it hoped at least half the job losses could be achieved through voluntary redundancy or early retirement.

Nestle spokesperson, Jane Bassham told PIN: "We have decided to move the production of Smarties to Germany, Dairy Box to Spain and Black Magic to the Czech Republic. We already have manufacturing facilities in these locations and so it will be far more cost-effective for us."

Alastair Sykes of Nestle UK said: "The confectory market is very competitive. This restructure and investment will ensure our Nestle Rowntree business is fit for the future."

John Kirk of the GMB Union commented: "This will be devastating for the people of York and will be fiercely resisted."

The York firm will continue to employ 1,800 people after the cutbacks.