First seen as a way to help deprived neighbourhoods, Business
Improvement Districts (BIDs) are now at the centre of some of the most exciting development areas in the UK. We spoke to BID expert, Ruth Duston.
All over the world, Business Improvement Districts have proved to be remarkable drivers of economic renewal by providing a focal point for initiatives and collaboration between business, local government and invariably the property developers who are looking to progress projects in the relevant area.
They were born in Canada in 1970 and quickly spread through North America but it was 30 years before they were introduced into the UK via the 2003 Local Government Act.
In the UK, it is perhaps fair to say these ‘mini-development corporations’ were first viewed as a means of helping struggling areas rise phoenix-like from the ashes of deprivation. However, more recently, and especially in London, they have come into their own as helping to shape areas which are facing massive development activity.
BIDs typically drive initiatives aimed at improving the quality of the streetscape/public realm, enhancing security, the ‘greening’ of urban areas, sustainability and the marketing and promotion of their area.
Ruth Duston is a social and economic regeneration expert who cut her teeth working on a government special task group in London Docklands which looked at the impact of development on the local population and what could be done to ensure that they benefitted in parallel with economic regeneration.
It is this central ethos that has been carried into UK BIDS of which there are now more than 100.
developers and property owners appreciate the agenda because they know it’s going to increase values
After working on projects in the Hertfordshire new towns, Duston came back into the capital to work with the Waterside Partnership in Paddington – a body set up to support development in the area.
Reflecting on that time, she comments: “What we were starting to find was that there was much more emphasis on the social, economic and physical generation of an area. Developers were starting to take more interest in the areas that they were investing in and to look more socially and economically at the impact they were having.
“That was the reason why a partnership was formed at Paddington, really to drive that agenda forward. Paddington was one of the first London business improvement districts to be developed.”
Duston has now become a ‘go to’ expert for areas in London looking to set up BIDs. She helped establish the Baker Street Quarter and is currently actively involved in the Victoria and Northbank BIDs.
She is also advising on partnership projects in Aldgate, Kings Cross/St Pancras and Cheapside – the last of which is heading for BID status. When prime areas in the Square Mile see the value of becoming a BID it’s clear that these bodies can achieve a great deal in all types of urban environments.
In many respects, BIDs fill the vital gaps that public sector services are not designed to address.
Duston explains: “We do a lot around business continuity, corporate community engagement and acting as a forum for business and developers. We are able to take more of a 360-degree view than any individual business or developer. We can co-ordinate everyone’s efforts so that there is the best outcome for those who are invested in an area from both a corporate or community perspective”.
BIDs are established by a vote among local businesses and require a mandate of at least 51% to be set up. They are then funded by an obligatory levy on local businesses which equates to around 1% of the rateable value of their property.
“When you set up a BID, developers and property owners appreciate the agenda straight away because they know it’s going to increase their asset values. And for retailers and hoteliers it’s an easy sell because we’re offering improvements in footfall, dwell time and ‘beautification’ of the area.
“For a corporate occupier it’s initially a bit more nebulous so the ‘hearts-and-minds’ battle is really about bringing all occupiers on board and so that they feel convinced there is benefit.”
We can play a major role in improving public realm and connectivity
Duston believes that it’s often hard to win this battle until a BID has shown what it can achieve: “When you have the mandatory re-ballot after a BID’s first five years of operation, you tend to be voted in by a much stronger majority of the business community because they have seen the merits of what they have been paying for.”
Somewhat anomalously, at present, it is possible for owners and developers in an area to basically freeload on the work that is done by a BID and funded by local business without paying a penny.
Duston is quick to point out that many owners and developers are keen to engage financially but it makes sense to regularise the situation: “You get many developers and owners that are very responsible – companies like Land Securities, British Land, Derwent London etc – and who will make a voluntary contribution but you also get a lot that won’t. So they reap the benefit and make no contribution at all but their tenants are the ones paying for it.
Next year this inequality will be addressed by the introduction of new property-owner BIDS which require owners who have been previously exempted from the levy to pay. However, instead of just bringing owners into the existing levy framework, these new BIDS will sit outside it as separate entities.
Duston, like many others, is puzzled by the structure that is being mooted.
"We won’t be entirely sure how it’s going to work until the legislation comes out, but what we do know is that it will enable owners in areas where there is already an existing BID to set up a separate company to run the new property-owner BID through. Potentially, there is the threat that the two may not work in partnership but obviously we would hope that they would going forward.”
It would certainly be a massive step backward if the progress that BIDs have made in the past few years was hampered.
Meanwhile, Duston and her teams are pressing on with expanding the benefits that BIDs deliver.
“We can play a major role in improving public realm and connectivity which, of course, is completely aligned with the modern view of placemaking. We have shown that we can make a real difference in terms of security. Our initiatives in Victoria have delivered a 26% reduction in street crime and are now being used as a template for collaboration between business and the police in other parts of the UK.”
She also believes BIDs should help promote available properties in their areas.
“If BIDs want to promote economic growth and inward investment then they need to be demonstrating what they are doing to assist that. It goes further than cleaning the streets and putting on activities and having nice marketing collateral. It is promoting what the area has to offer through its available space, and also looking at how that can help bring in new businesses to the area.”
The Northbank BID is now working with The Completely Group on an online platform to showcase available properties which follows a pilot scheme that The Completely Group is running with the Guildford BID, Experience Guildford.
Even though we are entering a more positive economic environment, Duston believes that government fiscal policy will ensure that there is a continuing and broadening role for BIDs.
“With the continuing austerity measures and the public sector still under pressure to cut budgets, BIDs are able to pick many of the essential co-ordination, collaboration and promotional roles that local authorities are now just not able to fulfil.
“By working in partnership, everybody in a BID area – businesses, property owners, developers and the local community can all benefit. It’s a much more 21st-century way of looking at regeneration and renewal.”
The work of BIDS today may be less about ‘helping phoenixes to fly’ and more about creating an environment for dynamic development, but it is clear that they will have a growing influence on urban placemaking.