Look out across the Manchester skyline and, although you may not be aware of it, the tangible results of foreign investment in the city are staring back at you. 


The patchwork of cranes and high rise buildings, combined with the relentless reverberations emanating from multiple construction sites, provide a visual and audible indication that this is a city on the up, and in more ways than one.

Manchester alone attracted 45 foreign direct investment projects in 2017, a 2% increase on 2016's record breaking figure and is second only to London as the most desirable location for foreign businesses in the UK [1]. With its exponentially expanding airport, three leading universities and booming property market, it is easy to see why Manchester has become the city of choice for many investors across the globe.

Through initiatives like the Northern Powerhouse, the Government has pledged to invest heavily in promoting potential growth opportunities represented by northern cities. The Department for International Trade recently announced £2 billion worth of projects at Trafford Waters, MediaCity UK, Future Carrington and Stockport Exchange and has sought to promote these projects to a broad range of international investors. For example, in November 2016 a Chinese trade delegation was briefed by UK officials specifically on the investment opportunities presented by the Northern Powerhouse projects [2]. However, organisations across the city have forged ahead, taking it upon themselves to develop trade links with international investors. Most notably, the Manchester-China Forum [3] and UK–China Infrastructure Academy [4] have attempted to espouse the benefits of investment in Manchester to the growing number of Chinese businesses seeking to invest in the UK, whilst the Manchester India Partnership has sought to replicate this approach with potential investment partners on the sub-continent [5].

The re-development of Manchester city centre precipitated by the IRA bombing, including the regeneration of the Arndale Centre and the construction of the Urbis building and the Printworks, resulted in  Manchester becoming a magnet for investment from the US and Europe, a trend which has continued throughout the last two decades. This stream of investment has by no means dried up, for example, the last two years have seen XPO Logistics take up 237,000 sq. ft. of warehouse space in Trafford Park [6], Union Investment acquire the XYZ Building for £85 million [7] and Booking Holdings take up residence as the anchor tenant in the St John's Development [8]. However, as the US pursues an increasingly insular economic agenda and EU based businesses fret over the potential ramifications of a no-deal Brexit, attention has turned to investment from further afield, which the UK is keen to encourage, especially as part of the Government's attempts to show that the country's economy can flourish in the post-Brexit world. 

Asian businesses in particular have begun to broaden their horizons beyond the London-centric outlook that has previously characterised investment in the UK, with the fall in the value of the pound following the 2016 referendum vote providing potential investors with greater purchasing power, which, combined with the avoidance of the London premium, has made Manchester a particularly attractive and financially rewarding investment opportunity.

China is the number one target for inward investment in the UK and Chinese businesses have already been attracted to participate in Manchester's growth, with a 225% increase in buy-to-let investment enquiries from China in 2017 [9]. The Manchester-China Forum estimates that development projects worth £2.1 billion across the city benefitted from Chinese investment in 2016 and more is expected over the coming years, including the UK China Infrastructure Academy's planned investment in the development of integrated transport systems at Piccadilly Train Station and Manchester Airport [10]. Airport City has also benefited from £800 million of investment from Beijing Construction Engineering Group International (BCEGI) [11], whilst the company is also in the process of constructing 2,215 homes at Middlewood Locks in Salford [12], with BCEGI turning to Addleshaw Goddard for advice on both projects. In sport, Chinese state backed China Media Capital and CITIC Capital invested £265 million in City Football Group, Manchester City FC's holding company [13] and these ever expanding links between the city and the land of the red dragon have led to the launch of direct flights between Manchester Airport and Beijing and Hong Kong, including Hainan Airways daily connection between Manchester and Beijing, the only direct flight between the UK and China outside of London [14].

Indian businesses and investors have followed closely in the wake of their northern neighbours, with Aegis and Vistaar Productions ploughing funds into the second phase of the development of Salford's highly successful MediaCity [15]. 2018 has also seen the launch of the Manchester India Partnership, a public-private initiative which seeks to capitalise on opportunities for collaboration in areas such as trade, tourism and academia [16]. Whilst only in its infancy, the Partnership has already provided the catalyst for the creation of strategic links between the Universities of Salford and Bolton and their corresponding institutions in Bangalore and Karnataka, with Jet Airways also announcing plans to introduce a direct Manchester to Mumbai flight before the end of 2018 [17].

In a sign of Manchester's growing reputation as a hub for science, technology and innovation, Hero Cycles selected Manchester as the location for its £2 million global design centre. This followed the company's investment in Avocet Sports Ltd and the centre was recently used as the base for the launch of its new Insync bike range [18].

Science and technology provide fertile ground for the cultivation of further overseas investment in the city, with the development of the Graphene Engineering and Innovation Centre, already part funded by UAE-based Masdar [19], and the new Sir Henry Royce Institute for Advanced Materials [20] being just two of the Manchester universities' current projects which are expected to entice foreign investment in the coming years.

Technology giant Japan is keen not to be left behind by Manchester's emergence as a digital hub, with Brother, Kratos Analytical, Hitachi and Fujitsu all establishing themselves at sites across the city [21]. Jo Ahmed, partner at Deloitte and recently appointed Honorary Consul of Japan in Manchester, has promised to strengthen Manchester's trade and investment links with Japanese businesses, whilst research partnerships between Manchester's universities and corresponding Japanese institutions are also being cultivated [22].

Addleshaw Goddard is keen to continue to play a leading role in facilitating the investment and projects that are driving Manchester's growth and securing its position as the figurehead of the Northern Powerhouse initiative. Mike O'Connor, partner and head of the Manchester office, notes that the city has 'worked very hard over the last 15 years at honing its message and being clear on why it's a great place to live work and invest. Part of that message has been aimed at overseas businesses and investors and that is now really bearing fruit.' The firm is currently advising on some of the most attractive projects for foreign investors across the city, including the expansion of Manchester Airport City and the second phase development of MediaCity. Addleshaw Goddard's extensive experience advising foreign clients seeking to invest in the UK, including BCEGI, Hitachi and the Bank of Tokyo, combined with the firm's growing international presence, places our lawyers in the perfect position to advise businesses across the globe on investment in Manchester. Looking forward, O'Connor is 'very optimistic that the Manchester City Region will continue to grow and be an attractive destination for foreign investment.'

Manchester, the birthplace of the industrial revolution and the sporting capital of the north, is a city striving to reach its potential and the investment returns on offer are proving highly attractive to investors from the US, Europe, the Far East and beyond. The pace of development and innovation is invigorating yet challenging, and therefore clear, informed, expert legal advice is a necessity for potential investors. Addleshaw Goddard is on hand to provide it.

This article was written by Daniel Hovington (Trainee Solicitor) and Faizaan Khan (Associate).

Key contacts

Michael O'Connor

Michael O'Connor

Partner, Head of Manchester office
United Kingdom

View profile
Faizaan Khan

Faizaan Khan

Associate, Infrastructure Projects & Energy
Manchester, UK

View profile

[1] https://www.ey.com/uk/en/newsroom/news-releases/18-06-11-manchester-top-city-outside-london-for-foreign-direct-investment

[2] https://www.manchestereveningnews.co.uk/news/greater-manchester-news/chinese-funding-northern-powerhouse-mediacity-12154688 

[3] https://www.investinmanchester.com/about-us/manchester-china-forum

[4] https://www.mbs.ac.uk/news/uk-china-academy-set-to-boost-manchester-infrastructure-investment/

[5] https://www.investinmanchester.com/about-us/manchester-india-partnership

[6] https://www.insidermedia.com/insider/northwest/250k-sq-ft-logistics-warehouse-completed

[7] http://europe-re.com/union-investment-acquires-development-of-the-xyz-building-in-manchester-uk/61922

[8] https://www.insidermedia.com/insider/northwest/booking.com-unveils-100m-investment-and-jobs-in-manchester

[9] https://www.buyassociation.co.uk/2018/03/20/chinese-buy-to-let-investors-flocking-to-manchester-as-enquiries-rise-250/

[10] https://www.telegraph.co.uk/property/uk/chinese-investment-manchester-property-powers/

[11] http://bcegi.co.uk/projects/airport-city/

[12] http://bcegi.co.uk/projects/middlewood-locks/

[13] https://www.reuters.com/article/uk-soccer-manchester-city/chinese-investors-buy-stake-in-manchester-city-group-idUKKBN0TK3NY20151201

[14] https://www.manchestereveningnews.co.uk/business/business-news/hainan-airlines-start-new-daily-12958119 

[15] http://www.growthco.uk/news/manchester-strengthens-ties-with-india-to-signify-new-era-for-bilateral-trade/

[16] https://www.investinmanchester.com/about-us/manchester-india-partnership

[17] https://www.manchestereveningnews.co.uk/business/business-news/jet-airways-manchester-mumbai-route-15004867

[18] https://www.investinmanchester.com/information/news/2018/5/3/manchester-based-indian-owned-hero-cycles-unveils-new-insync-bike-range-for-uk-market-a2578

[19] https://www.insidermedia.com/insider/northwest/60m-graphene-engineering-innovation-centre-tops-out

[20] https://www.eurekalert.org/pub_releases/2017-02/eaps-mju022317.php

[21] https://www.manchestereveningnews.co.uk/business/manchester-catalyst-uk-relations-japan-11005345

[22] https://www.manchestereveningnews.co.uk/business/business-news/new-honorary-consul-japan-appointed-14111326