YORKSHIRE is primed for a mass exodus from Whitehall – as a result of the new government’s intention to deliver efficiency savings across public sector property.
National commercial property consultancy Lambert Smith Hampton said the region was set to benefit from any decision to move key government departments out of central London.
Chancellor George Osborne has drawn up a £6.25bn package to reduce the UK budget deficit. It includes £170m from reducing property costs, at least £120m from a civil service recruitment freeze and £600m from reducing quango costs.
Guy Gilfillan, head of LSH in Yorkshire, said the ensuing relocations posed very significant opportunities – particularly for Leeds and Sheffield.
While they were distressing for those at risk of upheaval, they were necessary to help reduce the UK’s budget deficit, he added.
“As in previous recessions, the public sector looks set to become a net disposer of commercial property,” said Mr Gilfillan.
“It seems entirely sensible that, in view of the government’s stated need for national austerity, central government departments and quangos should be scrutinising their property costs and use of space with a view to radically minimising both.
“With about 644 public sector leases due to expire or reach a break clause in the current financial year – a high proportion of which are located in central London – and a further 15,000 civil service positions identified for decentralisation, now would be the perfect time to implement a cohesive rationalisation strategy”
Said Mr Gilfillan: “The implications of such a review could be immense for the lower-cost regional property markets, particularly when private sector occupational demand is still fairly muted.”
