Avison Young responds to the Chancellor's spending review

Nick Walkley, Principal and UK President: “Amidst the blizzard of billions, acronyms old and new and the inevitable ‘more detail will follow’ there are some significant and optimistic messages here.

“Firstly, this spending review marks a further acceleration in the devolution of significant spending decisions away from Whitehall and to the regions. We are in a new devolved era where investment and growth shifts to regional and not just national accountability. The most significant indicator of that being what would previously have been national transport infrastructure projects are now in the hands of mayors. Likewise “green book” decisions emphasising “place” seems to be a genuine attempt to embed this shift into Treasury decision making.

“That shift of course begs a question about what happens to those cities and towns not covered by existing Combined Authorities and will they lag further behind in investment and priority.

“Secondly, there are really welcome commitments to certainty, not least in affordable housing rents and capital expenditure. That certainty should provide a significant boost to private investment and ultimately delivery.

“And thirdly, this is an infrastructure investment budget that promises much for the private sector to come alongside across multiple sectors and regions. Long-term commitments in Energy, Transport and R&D will create demand for new assets, and open up new opportunities for investment.

“That essentially upbeat message comes with two provisos. This first is that all of this spending is heavily predicated on growth and there is still some way to go to build the momentum necessary to unlock private capital and get schemes moving. Residential and commercial development delivery have yet to see signs of sustained recovery. Secondly, the Housing Infrastructure Fund provides a cautionary example. Huge numbers may make for great headlines and intent may be in the right place, but the strings attached to releasing funds will ultimately determine success.”

Stephen Cowperthwaite, Principal, Managing Director, Regions & Liverpool: “The Chancellor’s announcement provides a clear signal that regional transport is being prioritised. Investment in tram and mass transit systems across the North and Midlands is essential to unlock inclusive, long-term growth. Improved connectivity across the Northern Arc, from Liverpool through Manchester to Leeds and Newcastle, has the potential to link talent with opportunity, attract international investment, and create the conditions for innovation, job creation and housing delivery.

“Much of the existing infrastructure is outdated and under pressure, limiting productivity and economic growth. Projects like the TransPennine Route Upgrade, supported by public-private partnerships such as the Liverpool-Manchester Railway Partnership Board, offer a chance to modernise networks in a way that is both strategic and locally responsive. When delivered alongside wider improvements like HS2, the benefits multiply strengthening regional economies and unlocking long-term regeneration potential.”

Joanne de la Porte, Principal, National Lead for Public and Health Sector, Avison Young: “The NHS may be positioned as a major winner in this Spending Review, but the reality is more complex. Capital will rightly focus on the so-called ‘Three Shifts’, digital enablement, prevention, and community care, but we’re still working with a Capital delivery model designed for a different era. Investment has historically flowed into hospitals rather than community infrastructure, and while ICBs have the tools to reimagine the estate, they’re blocked by bureaucracy, delayed approvals, and structural indecision at the centre.

“We are now sleepwalking into a capital crisis. The backlog is growing, critical infrastructure is deteriorating, and several Trusts with the most urgent estate risks remain locked out of national funding streams. Fast-track approvals, smarter estate systems, and greater provider autonomy are non-negotiable. This is no longer about efficiencies, it’s about resilience and the basic viability of modern care delivery. If the government is serious about the long-term future of the NHS, it must stop delaying hard choices around capital reform, including alternative funding models. The question isn’t whether we can afford them, but whether we can afford not to act.”

Helen Collins, Principal, Managing Director Midlands, National Head of Affordable Housing, Avison Young: "A £39bn Affordable Homes Programme and a 10-year rent settlement is a game changer – this is the first ever 10-year grant programme. Long term certainty creates the platform for driving real momentum in affordable housing and housebuilding generally. Critically, it should unlock more private capital for affordable housing and then overlay LGPS reform, and we have the ingredients for place-based investing at scale. Rent convergence, if reinstated, will unlock further capacity for building new homes.

“With declining SME builders and a shortage of construction workers early action at pace and scale is needed to train a new generation of construction workers to deliver on the ground. Clarity over Homes England’s future role and ability to provide low-cost funding to support SMEs is key – without it we’re limiting the system’s ability to deploy the capital that can now be leveraged at scale. If housing is to drive growth and unlock regeneration, then the institutions delivering it must be equipped to act with pace and purpose. This Spending Review sets the tone, now it’s about delivery.”

Chris Wright, Head of Sustainability and Decarbonisation, Avison Young: “Clean energy delivery isn’t short on ambition, but a lack of commitment in the spending review of the £8.3bn funding for GB Energy risks slowing progress. This investment was meant to underpin the Government’s 2030 Clean Power Plan, but also act as a catalyst for innovation, industrial transition, and new skills. If funding is reduced or delayed, we need clarity on how that impacts the wider strategy and what fills the gap.

“The approach to nuclear on the other hand is broad and ambitious, with £14bn for Sizewell C, £2.5bn for Small Modular Reactors (SMRs) and £2.5bn for fusion projects. The announcement of Rolls Royce as the preferred government partner for SMRs is not only a boost for UK innovation and manufacturing, but also an opportunity to position the UK at the forefront of technology globally.

“Our commitment to carbon capture is also being accelerated with funding for the Acorn project in Aberdeenshire and Viking project in Humberside. These join Merseyside and Humberside, which have previously been announced and significantly increase our investment in heavy industry decarbonisation, again positioning ourselves at the forefront of this technology globally, behind only the USA.

“There was a lot to be happy about in the Spending Review from an Energy and decarbonisation perspective, but there is still scant detail around investment in floating offshore wind, hydrogen and grid modernisation, and the role the National Wealth Fund will play in unlocking further ambition and investment.”

Kat Hanna, Co-Managing Director, London, Avison Young: “With this the first time in nine years that London has had a Labour Mayor and Labour government, hopes were high for clear departure from the days of ‘levelling down’ the capital.

“There will no doubt be some disappointment that the Spending Review has not been more directly supportive of London. While a four-year settlement for Transport for London offers some stability, although we are yet to know exactly what it entails, the lack of backing for major transport projects like the Bakerloo Line or DLR extensions raises serious questions about the health of London’s public transport network in the near future. Major upgrades and extensions such as these are critical not just for mobility, but for delivering large numbers of homes in well-connected locations. This investment in infrastructure is necessary if we are going to deliver new neighbourhoods at sustainable densities, in places like Thamesmead.

“There are some clear positives, notably the Affordable Housing Settlement, for a country desperately suffering from a lack of affordable homes, and London of course benefits from investment in key services like the NHS. However, the delivery of new homes already grinding to a halt in London, the absence of support for infrastructure that can help unlock schemes raises important questions about how major projects in London can be funded. The longer such schemes remain in the ‘too difficult box’, or subject to vague noises about private sector partnerships or greater fiscal freedom for the capital, the more London’s future success is at risk, and with it, that of the wider UK.”

Stuart Howie, Principal, Managing Director, Leeds and Head of Regeneration at Avison Young UK: “Today’s Spending Review has delivered a strong signal of intent – to invest in much-needed infrastructure that will drive long-term economic resilience. For Yorkshire, it puts improved connectivity at the heart of our region’s growth agenda.

“The £2.1bn confirmed for a new mass transit system in West Yorkshire and £1.5bn in South Yorkshire for public transport upgrades, including a new fleet of trams and franchised buses, will be a game-changer. And the £3.5bn pledged to be invested into the TransPennine rail route will significantly improve Leeds’s intercity connectivity, not only enhancing mobility between our cities and towns, but also helping to unlock enormous economic potential.

“These new routes are all about better connectivity and improving people’s access to employment opportunities and amenities. For the property sector, it’s the infrastructure investment that has been needed for a long time. It will undoubtedly act as a catalyst for future regeneration and growth, particularly along the new routes.

“At the same time, the rising housing targets across Yorkshire, particularly in North Yorkshire, have made clear just how urgent the need for further support from the government is. Local leaders are right to call for more funding, and the allocation of funds to the Ministry of Housing, Communities & Local Government should help deliver more homes, particularly affordable homes, across the region.

“Yorkshire has perhaps suffered more than other regions with false dawns when it comes to major transport investment, so the Spending Review commitments are a positive sign of intent that the region is finally getting the investment needed to boost regional growth.”

Gordon Hewling, Principal, Managing Director, Newcastle at Avison Young UK: “The message set out by the government in today’s Spending Review is clear: the growth of our national economy can only be unlocked by boosting opportunities across our regions. The outlook is positive, and nowhere is the opportunity more visible than in the North East.

“The £1.8bn set out to improve public transport in the North East, including a Metro line extension to link Newcastle and Sunderland, alongside a £1bn investment in Tees Valley, represents a generational investment in regional connectivity. This funding will not only transform how people navigate local communities, but offer devolved transport powers to better connect the North East and Tees Valley economies, catalysing new opportunities for regeneration.

“This kind of investment in transport lays the foundation for long-term growth, making a compelling case for further investment and development across the region, sending signals to investors that the North East is here, and ready.

“As put forward by the North East Combined Authority, the collective vision is for the North East to be a region we are proud to call home, and for too long, this has been overlooked nationally. The funding for housing set out in today’s Spending Review can help turn that vision into action, unlocking stalled sites and enabling the delivery of affordable homes via a £39bn investment.

“Equally, this funding presents an opportunity for local authorities to apply the knowledge built up over several years to embrace a place-based approach to future projects. This is a significant step forward for our region, giving the North East the tools we need to grow sustainably and confidently for the future.”

Barry Crichton, Principal, Managing Director, Manchester at Avison Young UK: “With targeted investment across transport, housing and infrastructure, the prospects set out in today’s Spending Review bode well for growth in regional markets like Greater Manchester.

“The £15bn national commitment to improving city-region transport across the country, announced last week, is a particularly encouraging step. The £2.5bn earmarked for tram extensions in Greater Manchester will be transformational, further strengthening connections to growing business hubs such as Stockport, and confirmation of the plan for the Liverpool-Manchester Railway represents a major step forward in addressing the historic imbalance in infrastructure investment across the UK.

“For too long, transport projects outside of London have been undervalued. This funding is not just a boost for connectivity, but will open the door to further investment, greater mobility for the people who live and work here, and create a more resilient regional economy, on the basis of long-term, place-based value.

“When investment in transport is aligned with housing, it creates the kind of long-term ecosystem that is needed for our region to prosper. The past two decades have seen Manchester experience huge transformation, which has led to significant growth in the city region’s job market and population. This in turn has resulted in unprecedented demand for housing, with the private rental sector now representing most of Manchester’s housing market.

“That’s why I am encouraged to see a continued focus on housing, with £39bn committed to affordable and social housing. Today’s Spending Review lays a promising foundation, and I look forward to seeing the opportunities it creates for Greater Manchester, but we mustn’t get swept away by promises – the region’s public and private sectors need to work together to ensure these opportunities come to fruition.”