Edinburgh launches major drive for inward investment

Today’s post looking ahead to the launch of our new Economic Strategy focuses on help to support inward investment to Edinburgh.

Edinburgh is developing a major programme of support for inward investors as part of a pioneering 'Strategy for Jobs' to be launched next week.

The programme builds on the city's success in attracting high profile investments from overseas - such as US online retailer Amazon (900 jobs), Spanish wind turbine manufacturer Gamesa (800 jobs) and Swiss banking software group Avaloq (500 jobs).

This responds to a widening jobs gap - high population growth and the challenging global economy mean that by 2018 there could be up to 37,000 more people wanting to work in the city than jobs available - and sets out four programmes of activity to address this.

The inward investment programme aims to further develop Edinburgh 's already impressive credentials as a globally competitive business location, with priority goals including a widened range of direct international air routes from Edinburgh Airport.1

"It's not always huge numbers of jobs being created, but it's the quality that counts," explained Councillor Tom Buchanan, Economic Development Convener at the City of Edinburgh Council .

"They're coming in at a very highly skilled level, reflecting Edinburgh 's knowledge economy credentials2 and often leading to further follow-on job creation later. The sectors attracting inward investment are also across the board from a wide range of different countries3. I think that's really encouraging in the current economic climate and shows we don't have all our eggs in one basket."

Hotels, renewable energy and education are performing particularly well. Recent announcements include German hotelier Motel One opening two hotels in the city and Hilton Worldwide investing £24m in upgrading the 241-room Caledonian Hilton to Scotland 's first luxury Waldorf Astoria. Alongside Gamesa, who have signed a memorandum of understanding with Forth Ports to work towards an investment of £125m in a manufacturing base in Leith, other renewable energy arrivals include French electricity supplier AREVA and German onshore wind turbine manufacturer Enercon. The government's new UK Green Investment Bank, intended to leverage billions of pounds in funding for new renewables projects, will also be headquartered in Edinburgh .

In education, the Chinese government recently helped Peking University establish a National China Research Centre with the University of Edinburgh to facilitate academic collaborations. Existing investors such as Boston-based financial services group State Street and New York-based fund manager BlackRock are also expanding, with recent new arrivals in financial services including Swiss Life and Helvetia Wealth, the Swiss fund manager.

Buchanan said announcements like these reflected the quality of Edinburgh's assets and offer, including current developments such as the £85m Atria project - the only speculative city centre office development outside London to offer more than 100,000 sq ft of Grade A office space by early 2013 - the opening of the £54m Scottish Centre for Regenerative Medicine, which will house up to 250 stem cell researchers; the £850 million redevelopment of the St James Quarter retail district; the £1 billion redevelopment of Edinburgh's Waterfront and the Edinburgh International project, which will transform land around Edinburgh Airport into an international business and transport hub, potentially injecting £4.4 billion into Scotland's economy.

Edinburgh 's world-class credentials in academic research and highly educated workforce, with over 136,000 people (40% of the working age population) educated to degree-level or above, remain key attractions for employers.

The new inward investment programme aims to build on these strengths with a series of actions to support and promote inward investment, including:

● Developing a comprehensive package of services for new investors including support with recruitment, property, planning applications, training and advice on housing and schools for employees and their families

● Identifying and engaging a target list of potential inward investors in key city regions of the Middle East, China, North America and London

● Delivering a series of investor events to promote connections and opportunities between new and existing businesses

● Working with NHS Lothian and the Edinburgh Science Triangle network of seven science and technology parks to attract new international tenants and market niche sub-sectors such as animal health and food safety

● Capitalising on flagship calendar events across Edinburgh and Scotland such as the 2014 Commonwealth Games and Homecoming Scotland 2014

● Publishing at least three new pieces of research a year on Edinburgh 's investor offer, including local markets, supply chains and location decisions

● Working with Scotland 's six other cities ( Glasgow , Aberdeen , Dundee, Perth , Inverness, Stirling ) and the Scottish Government to develop at least one shared investment proposal for international tender

Collaborating with national and local partners including Scottish Development International4, Marketing Edinburgh5 and VisitScotland , Scotland 's national tourism agency, is central to the City of Edinburgh Council 's 'Whole Council' approach to delivering the new strategy.

"The competition for inward investment is absolutely fierce, so we can't rest on our laurels," Buchanan said. "Collaboration will be key and we're calling on partners and existing inward investors to be ambassadors for Edinburgh . Tell everyone about what a great place Edinburgh is to live and work and share any connections that we might be able to benefit from collectively. Drawing talent, investment and high quality jobs from around the world is essential for Edinburgh 's sustained growth and that's why inward investment is such a key part of our Economic Strategy."

A conference to launch Edinburgh 's new Economic Strategy 2012-17 will be held in Edinburgh on 12 September 2012. Nicola Sturgeon, Deputy First Minister and Cabinet Secretary for Health, Wellbeing and Cities Strategy, and Lord Smith, Chair of the Green Investment Bank, will be guest speakers.

Our next post, on Monday 10 September, will look at how the Council plans to help support businesses in the city.

1More than 40 airlines fly to over 100 destinations worldwide from Edinburgh Airport , including New York ( Newark ), Paris Charles de Gaulle and Toronto . Annual passenger numbers are predicted to grow from nine million to 12.3 million over the next decade and again to 20.5 million by 2040.

2 Nearly half of Edinburgh's population is employed in high-value 'knowledge jobs' - including science and technology, education, communications, financial services, business services and research. Only London and Birmingham have more graduates in their workforces.

3 Other recent investors in Edinburgh include Talent2 (Australia), The Kooples (Belgium), Keihl's (USA), Teleperformance (France), enStratus (USA), Toshiba (Japan), Sixt (Germany), Finmeccanica (Italy), and InfoSys (India). See Edinburgh's NEW Arrivals on the Edinburgh Inspiring Capital portal.

4 Scottish Development International promotes international trade and encourages overseas companies to invest in Scotland .

5 Marketing Edinburgh is the official Destination Marketing organisation dedicated to promoting Edinburgh to the world.

CASE STUDY: Avaloq

The Financial Times' fDi magazine crowned Edinburgh the " Best Small City of the Future and Top Location for Economic Potential" in awards from 2010/11. Unsurprisingly so: Edinburgh was a real magnet for inward investment in the last years.

Take Swiss banking software provider Avaloq, for instance. The company decided to create 500 professional jobs in its Edinburgh-based development centre. " Scotland has a strong banking tradition and features 15 universities that train 2,000 highly qualified computer graduates every year", says Simon Kauth, Managing Director of Avaloq. "And Edinburgh is the United Kingdom's number two financial market and home base to many global players in the financial sector," adds Avaloq's CEO, Francisco Fernandez.

Avaloq and other investors benefited from the Council's Investor Support team: "The team was essential in solving daily obstacles, introducing us to the local financial community, and steering and advising us to help manage the risk taken when creating hundreds of jobs", explains Simon Kauth.

Brian Conley from Scottish Development International, Scotland 's national agency for attracting inward investors to Scotland , adds: "The contribution of colleagues from the City of Edinburgh Council was instrumental. They injected specialised local knowledge on issues such as commercial and residential property. And the warm welcome they extended to senior members of the Avaloq project team, including personalised support to those exploring relocation with their families from Zurich, contributed to the perception that 'Team Scotland' was fully aligned in its desire to win this investment and to support the company's future growth. We know this was one of the key factors cited by Avaloq in reaching its decision."

CASE STUDY: Motel One

Motel One, the Munich-based hotel operator known for affordable design, has chosen Edinburgh's Princes Street for its first UK outlet.

Why did you decide to come to Edinburgh?

Motel One is the low budget design hotel in Germany and Austria , where we have 36 hotels. We are currently internationalising and Edinburgh will be our first, but surely not our last, Motel One in the UK. Edinburgh, after London, is the most attractive city in the UK so is for an interesting location for Motel One. We are looking forward to opening the hotel in Autumn 2012.

Tell us about the Motel One offering?

Our strapline is 'Great Design for Little Money'. Each of our hotels uses high-quality materials and design classics alongside contemporary elements such as leather chairs and natural stone walls. Rooms start at £69. Our guests can expect a wonderful hotel in the centre of Edinburgh . The very special thing about this hotel will be the old building in which it is integrated. So the rooms won't look the same, but will have all different sizes and of course views into the city. The hotel will be completed by our "One Lounge" in the public area of each hotel. It serves as a lobby, breakfast lounge and bar, has free Wi-Fi Internet access and is open to guests 24/7.

Do you have plans for elsewhere in Scotland?

Motel One is definitely interested in more locations in Scotland and in the UK. Our developers are on the road and are always searching.

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