Call to shelve Esplanade Quarter
Saturday 23rd May 2009, 3:00PM BST.
Jim Greaves, of Hopkins Architects, designers of the Esplanade Quarter
THE Esplanade Quarter plans should be put on hold for two years until the economy has recovered, says a former Waterfront Enterprise Board director.
Senator Jim Perchard says that rather than trying to ‘force through’ the plans for a new financial district in uncertain economic times, they should be shelved until the time is right.
Harcourt have been given a deadline of the end of June to come up with a £95m bond to prove that they can carry out the project. If they make the deadline, Treasury Minister Philip Ozouf will make a decision on the reports on their capacity, the deal itself and the legal background to a lawsuit against the developers in America.
The 14-block Esplanade Square development will mix new offices, flats, shops and bars, and will provide two floors of underground parking beneath the area now covered by the Esplanade car park.
But Senator Perchard says that until the demand for thousands of square feet of office space can be proved, and until developers can raise enough cash to carry out the scheme, the States should leave the scheme on the shelf for a couple of years.
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This development should have never been given the go-ahead in the first place.
We are going to see numerous empty premises around St Helier and gradually over the years financial institutions will prefer to house their business elsewhere as our sustainable competitive advantage is eroded by larger countries clamping down on tax avoidance.
The problem is that few in the States seem to understand this. They are only focused on the short term and don’t want to rock the boat.
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This is the first time that i do agree with Sen Perchard. Any sensible person knows that this scheme is doomed.
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This actually makes complete sense.
Only thing that has been missed is that very few locals actually want a finance quarter for our failing world class, highly regulated highly outstanding, finance industry.
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First bit of sense to come out of a politicians mouth in a long time
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Good advice from the senator, but will anyone listen. I think it should be shelved permanantly.
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My honest opinion is that it is a recipe for disaster to even contemplate this project in this economic climate, without adding the consequences of the rising tide of anti tax avoidance world wide into the equation.
These two major issues make it a no brainer as far as I am concerned. If this is pushed through, knowing these issues are only going to get worse, then those responsible should be held to account. I cannot believe that they are even thinking of doing it.
However I believe the CoM will probably carry on regardless. If they do I can only say God help us!
As an added thought what happens if Harcourt, for any reason, are unable to finish it, or encounter unforeseen problems? What happens then?
I myself think the people making these decisions should think very carefully on what they are about to do. We cannot afford any more blunders on top of what we already have had.
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Funny isn’t it, the prime person we should be hearing from is from the man who the tax payer is putting a quarter of a million pounds a year into a wasted salary is the main man of WEB where is he and in fact who is he?
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If this is the best advice that Senatot Perchard offer, we are better off without him. 1) If there is a genuine need for a financial district, the current blip in the world financial markets will not lessen the need in the year or two it will take to build such a huge project. 2) The current problems with Harcourt existed when Senatot Perchard was a member of WEB. What role did Senatot Perchard play in the current mess?
The really big question is; does the Jersey finance industry have a long term future? 1) If the Jersey finance industry is a sound investment, we should back Senator Cohan and the Esplanade Square development. 2) If the Jersey finance industry, as we know it, has no future, all the planning has been a huge waste of time.
On balance I am a firm believer in Jersey and its future; a future where Jersey as a manager of intellectual property; hence don’t put the Esplanade Square plans away. We need to get out there and find a new developer, a developer with the funds to carry the project through to fruition.
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Can’t afford it; no finance demand (how would UK-owned banks justify new Jersey offices in the Telegraph??); awful, awful entrance to Jersey.
The ITV prog on Guernsey highlighted the view coming into the Island, cobbled streets, original frontages like St. Malo – all the things we’re having taken away from our Waterfront. Why doesn’t Tourism join the calls to kill this project?
Can States’ Members think about the Island above their egos and admit it’s not for Jersey 2009. If they want to ‘postpone’ it to save face, we’ll let them call it that…
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Green shoots of common sense perhaps?
Given however that we have more politicians per of heads of population than virtually any other country these rare green shoots of common sense will no doubt rapidly face the States weed killer.
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Could we have a call to shelve the CoM? This might get a better response.
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Good article in the Telegraph this week: showed that on the 4 previous occasions in the last 200 years when the stock market showed negative returns over the last 10 years, the following 10 years showed returns of 20 percent per year on average. That’s what the next decade holds.
The point is that there is much more reason to build the new quarter now than there was a couple of years ago, when it was approved. Now we are at the start of an economic upswing, rather than at the end of it. Jersey has been given a clean bill of health by the OECD and what’s more, tax has nothing to do with it.
There will be a Tory government in the UK in less than 12 months and they will be forced to do everything they can to support the City. There is already a torrent of HNWI coming to jersey, annoyed by 50% tax in the UK plus declining living standards.
We are about to enter a boom locally, and the smart ones are positioning themselves to make the most of it. C’mon Adrian – join the winners for once!
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Sadly I see this as a cynical ploy to try to ressurect the total car wreck Jim made of his political career,he knows this view will catch brownie points,this man broke the code of practice and was caught out, his performance on C.T.V. was squirm making and as far as I,m concerned he should be gone…the trust placed in him is gone …so what is he doing there, it would be too embarrassing to anyone with a social conscience..
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Harcourt has to come up with a bond for £95 million by the end of June. If they can’t it will be humiliation for them
Jimmy P knows the Harcourt chiefs well and perhaps in suggesting this he is laying the ground for an honorable Harcourt exit
Of course he is saying what most islanders with any common sense have been thinking for a long time. It is just that the government is not getting it
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‘Good article in the Telegraph this week: showed that on the 4 previous occasions in the last 200 years when the stock market showed negative returns over the last 10 years, the following 10 years showed returns of 20 percent per year on average. That’s what the next decade holds.’
I don’t see that as holding at all.
You may as well argue that on the basis of events in the 18th and 19th century large Western European wars are regular occurences but the last one was fought in 1939 – 45 and I can’t see another one soon.
I would argue that the forces that are going to shape the early part of the 21st century are stagflation due to rising commodity prices choking off economic growth in the West in particular and also the rise of China et al.
Long term London and hence Jersey will be marginalised as these new economies take the provision of financial services ‘in house’, Hong Kong, Shanghai etc are more trusted and closer to the action.
I would argue that the smart ones are keeping their powder dry and waiting to see which way the wind blows.
The commercial property market is still falling in the UK in terms of capital values, rents and occupancy.
If there is a developer out there that is prepared to give a 100% cast iron guarantee on funding, completion etc then maybe the States should go for it but given that background I doubt the States will find one.
As for your visions of a Tory government, listen to David Cameron and his immediate colleagues speeches, Jersey friendly they are not!
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12.
Well true I suppose,another success for our communications department! not!
11.
works in the finance district no doubt, unfortunatley forgeting the pact signed by jersey regarding the ‘passing of information’. You can run but you can’t hide!
Planning permission given(?) only 1 way this is going
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First bit of common sense from a member of the states for months.
Far more finance workers have lost their jobs than is published in the JEP, what is the need for more offices as the world sinks further into recession?
No locals want this development. It will be a disaster if it starts. Suppose the litigation prone developer stops building half way through – there will be a wasteland and we the tax payers will have to fund it.
Cancel this hideous plan immediately and leave the rather pleasant car park as it is.
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Two years will be great. Gives them time to plan where everybody will park!!
Even the development that has being completed is at its parking capacity and now the parking will be built on.
So now we need probably three times the parking space that there is presently on the esplanade.
Lets get the bridge to France idea going again to keep the minds of the electorate off the incompetence. Or how about Cow Flu.
Blunder again I say!
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Some months ago I replied to the COM request forquestions relating to the strategic plan. In the letter I made 18 comments to which I sought a respnse. I have not as yet received a reply.
Comment #11 reads:
’11. Delay commencing any other major capital projects until such time as the fog has cleared’
( ‘fog’ refers to the uncertainties in global financial and economic conditions.)
I would ask any politician who supports any of my 18 comments to bring a private proposition to the States.
It can take a lot of work to prepare a private proposition but this is what we pay our politicians to do.
It is not sufficient for them to merely give statemnts to the press without doing something about it.
There is growing support for the propoosal to hold back on the esplanade quarter.
It is all very well ‘talking the talk’, but politics, in my view, is more about actions than making public proclamations.
Who amongst our esteemed politicians will pick up the gauntlet and bring this important matter to the States?
I won’t hold my breath waitng for an answer.
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Ok, we are in very bad times in the finance industry now, but come better times will we really need to move the whole finance industry into one area? I just cannot see all the banks and trust companys upping and moving to be next to each other. There are plenty of office buildings lying empty at the moment. Even Dandara have put on hold building on the old Swansons hotel site next door.
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The reality is that the Esplanade scheme has already been mothballed.
But Phil’s comment about waiting until the fog has cleared misses the point: there is always fog about the future. For 30 years now people who don’t like the finance industry have been predicting its demise.
Waiting until the fog clears is really an alternative way of saying “the finance industry has become too big, let’s make sure it cannot expand further”. And an argument can be made to that effect, but it would be better to have the honesty to make it directly and suggest where jobs for young, local people can be created if not in the finance sector.
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Anyone who is predicting a bull market of massive proportions and an economic boom in the next five to ten years should factor in the sheer indebtedness of the Western economies.
Italy, Ireland and Iceland owe staggering amounts with Iceland in particular being so far in debt that a bout of price inflation, currency devaluation etc seems the only way out.
The US and the Uk have averted a banking and economic crisis but only at the price of putting their economies in hock to the tune of billions of dollars.
The alternative was worse, they could have let the failed banks go down but that would have resulted in economic meltdown and maybe even a loss of faith in the entire financial system.
Looking at the dividends that FTSE 100 companies are prepared to pay at the moment and for the foreseable future I would say that the outlook is dicey.
Nothing is ever uninterrupted gloom and there will be some economic bright points but anyone expecting their £500,000 house to be worth £2,000,000+ in ten years time is likely to be disappointed, trees don’t grow to the sky.
On a rational basis, I would expect salaries, profits etc to fall in real terms and taxation to rise as the States battle to solve their structural deficit over the next ten years thus the support for massive capital growth is not there.
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Oh well, what a shame. I was led to believe that it had already been all but shelved anyway.
If and when such a development does eventually go ahead can they move it somewhere and stop destroying the look of the island. For goodness sake put the finance quarter and its ugly buildings somewhere that doesn’t ruin the look of the place. There is absolutely no need for the offices to have sea views, after all, they are there to work are they not?
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So the question is, if we don’t do it, how much willour taxes have to rise to:-
1 pay Harcourt off as they would have spent millions to date and thats without compensation
2 To cover the revenue that The States will not get for allowing this land to be built on
we should remember that we (The States) invited developers to tender for the building and awarded them a contract if we now want to break that contract we have to pay, perhaps the Senator could give us an indication of what that would cost as I assume he didn’t propose to shelve it wiothout knowing the true cost
and do we really think that banks/ trusts/ lawyers willnot move in this current climate, some companies are spread over 4, 5 or 6 buildings, most old and not efficient, there would be a long term saving in moving, not just on duplicated staff but heating etc
So lets see what the cost will be, lets hear from some of the banks then and only then can we take an informed view!
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Leave well alone due to recession/depression and because of the insecure future of finance due to outside pressures building up.
We do not need a new finance centre and we do not want one.
Diversify now before it is too late!
I strongly advice the States to ditch any big spending and to make savings where ever they can. This is not the time to be taking punts on our future well being.
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I believe that the original plan when Freddie Cohen gave the go ahead before Christmas was that Harcourt would have the funding in place and the plan would have been put to the States in the early spring.
We have now started to slip from this schedule and Harcourt have until the end of June to get the funding into place so the plan can be approved.
In the present climate getting a bank to come up with £350M to fund a scheme first mooted in the boom time of a few years ago is not the easiest proposition.
Until I see otherwise I am expecting this schemes start date to slip gently into the future.
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This should have been abandoned before it started! There are many buildings already developed standing free to be still unused! What is the point in building a load more that will just be left empty! Building flats that no one can afford to buy!!
Although im sure the finance industry will pick up again in the future, i do not think it necessary to provide any more buildings when there are plenty available already!!
Stop defacing the island with property that no one wants nor can afford just to fill your greedy little pockets with sneaky payouts!! Thats all thats going on!! Its amazing how these big projects keep getting passed, then all of a sudden something comes out the woodworks….an error in planning, misplaced funding!! Seriously!!!
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Well we can only hope that they have the right under whatever contractual arrangements have been entered in to to call for the £95m bond and have obtained legal advice confirming same. If that is the case it would be the States that would have a claim against Harcourt for losses flowing from its breach and not the other way round.
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Jaime, you’re right. The number of incentives I’ve been getting through the door recently to try and get me to buy one such apartment is ridiculous. Now they’ve pretty much given up targetting those that will live there and are actively targetting the buy-to-let market.
If there was the need for these types of apartments they would be selling. They’re not selling (well they seem to have been conveniently 80% sold for a very looooooong time already) and yet even more are under construction!
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Leah,
Surely if they are struggling to sell the existing flats, as you suggest, you should want them to build more ones, as in the end, if supply outstrips demand, the price will fall.
Or perhaps you are suggesting that the States should try to stop developers building flats so that the price of property remains bouyant. Or is your point that Jersey should be entirely covered in concrete and lawns so everyone can live in a 3 bedroom house.
I’m simply struggling to work out what you want: massive development of the countryside and houses for all; no more building and ever rising property prices; or more flats built, flat prices dropping and perhaps the odd developer going bust if they overestimate the demand for their product.
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Mad Foetus, it’s quite simple. There is supply outstripping demand a bit and supply outstripping demand by a ridiculous amount. It only takes the first one to make the house prices go down! The other is just wasting space that could be put to better use. And even if there wasn’t use for it an ugly occupied building is bad enough but an ugly unoccupied building?
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Oh yeah, where did the 3-bed houses with lawns come into my comment? Must have missed that!
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What a waste to put the scheme on hold now. The plans look great, certainly a lot better than the waterfront we have at the moment.
Business will undoubtedly move in – especially if the rents turn out to be cheaper due to lack of initial demand.
We may be in a recession, but recessions end and we will be back in a boom before you know it. Jersey will be left behind if it has failed to put in place adequate infrastructure by then.
Jaime – I can’t think of many new bulds standing unused. In fact I can only think of one – on the eastern side of the tunnel (and that has been empty for years). Town at the moment is not a picture of the modern professional business centre that it needs to be.
This scheme forms a massive part of marketing Jersey for future business and tourism. We can’t scimp now if we want to attract what business is out there now and will be in the future.
Many of you don’t want the business, many don’t want the finance industry at all. That is fair enough, but in my view unrealistic. It is far too late to come off the finance path now, if we do, the Island’s problems will be a great deal worse.
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I would suggest that they are not struggling to sell the flats they are building, developemnts never sell out entirely, remember years ago when Penelope Keith was on a voice over for Oaklands Manor, well that took over 2 years to sell when it was new thats why they paid for hwer to voice over the ad!
If they were struggling then prices would be falling now but they are not!
I hear those saying no more flats but where do you want our children to live? if you say houses thats great but how many fields need to go to create enough houses, at least flats are space efficient, things change and lifestyles do to, and like it or not apartment living is becoming popular as it is affordable (OK more affordable than houses) and it is better than renting!
so consider what you wish for, Goose green was highly controvesial but like I say above there will be many more fields lost if we stop building apartments
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Whatever #33, I disagree that it looks great but it’s alright. The sinking of the road, however, will also affect an area that looks fine as it is, never mind that I’m not convinced about flooding protection. Not only that, there are people in that vicinity trying to sell their flats at the moment having to explain that the development may not go ahead because no-one is going to buy these flats just to have building works outside for a long time to come.
Which brings up another question. Will the States provide alternative accommodation for those who are going to have building works on their doorstep for a long time. Even if it is just at the weekends so they get a couple of days of peace and quiet.
They won’t, they’ll ‘limit’ the work to within certain hours but won’t enforce those hours when the contractors break them. The people in this area have had to put up with constant building works for far too long now without any break and they are due a rest. No-one should have to tolerate that.
It’s time the States got expert advice as to how constant and excessive noise can affect people’s mental wellbeing, either that or they should be prepared for a rise in sick days and a greater need for psychological services.
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No matter how much the States want this project my money is on the whole thing being quietly shelved for a few years.
A lot of banks have large portfolios of loans to property companies which are still making interest payments but there is now a serious decline in the capital value of the assets backing these loans.
The last thing they want is more of this stuff on their books so any loan to a developer is going to be on punitive terms with a big arrangement fee, high interest rates and some really nasty penalties if an interest or capital payment is missed.
Cheap money for developers ended in April 2007.
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Could it be that Senator Perchard is preparing his way for the next elections? I don’t recall him making a single negative comment when he was on the WEB board……
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Canary Wharf was built and stood vacant for years due to the economic cycle. Been there? It is now a thriving commercial and finance centre including not only offices (big ones) but retail and social facilities (ie bars). A compliment to those who saw beyond the end of their noses and who should now be proud. Seeing beyond the here and now? That is the Jersey Way isn’t it? The founders of the Jersey Finance Industry did so decades ago, and we should support those with vision now, with boldness and confidence in our futures.
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Carary Wharf may have been booming in the Nulbour unsustainable boom that has just ended in disaster, but tens of thousands of banking and other financial jobs have been lost and are still being lost – ask anyone who goes to London on business. I guess it is not very ‘vibrant’ now
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