General view of the high street
High Street Heritage Action Zones, Woolwich. Plumstead Road, Woolwich, Greenwich, Greater London. General view including Woolwich Market. © Historic England Archive. DP434211.
High Street Heritage Action Zones, Woolwich. Plumstead Road, Woolwich, Greenwich, Greater London. General view including Woolwich Market. © Historic England Archive. DP434211.

Heritage and its Role in Development and Place

Part of the Heritage Counts series. Over 10 minute read.

Investing in heritage is not just an investment in heritage but part of a strategic move that can directly influence local economic outcomes. As businesses set up in distinctive, historic buildings, they benefit from the competitive advantages that the heritage brings, attracting people and investments to place, boosting the local economy.

As cities expand rapidly, conservation and continued use of heritage can provide crucially needed continuity and stability. A city’s conserved historic core can differentiate that city from competing locations thus helping the city attract investment and talented people. In addition, heritage anchors people to their roots, builds self-esteem, and restores dignity. Identity matters to all vibrant cities and all people. In other words, the past can become a foundation for the future.
Rachel Kyte, Vice President, Sustainable Development Network, The World Bank in G Licciardi, 2012

Heritage bolsters businesses and local economies

Historic environments are economic catalysts and repositories for culture and heritage capital that attract businesses and investors, providing them with a competitive edge. By utilising, repurposing and investing in heritage, communities can create vibrant spaces and structures for diverse businesses to thrive in, from tech start-ups, artisanal shops to high street brands. This preserves our heritage while creating economic activity and prosperity.

Over the long term, places with strong, distinctive identities are more likely to prosper than places without them. Every place must identify its strongest, most distinctive features and develop them or run the risk of being all things to all persons and nothing special to any.
Robert Merton Solow, Nobel Prize winning economist, in Licciardi et al, 2012.

Heritage assets in commercial use play a vital role in local economies

  • Historic assets form a significant part of our commercial environment and of our high streets, towns and cities. Up to 48% of the national retail stock and 33% of all our offices are over a century old (built pre-1919) and still in productive use (VOA in Whitman et al, 2018)
  • There were approximately 142,000 retail, hospitality and commercial businesses operating in listed buildings across England in 2018 (Historic England, 2018)

Historic Houses is a membership association representing 1,450 independently owned historic houses, castles, and gardens across the UK.

In 2022, Historic Houses places:

  • Supported over 32,500 full-time equivalent jobs
  • Generated £1.3 billion for the UK economy
  • Welcomed over 141,000 educational visits
  • Hosted over 26,000 cultural events
  • Appeared in 4,100 days of filming
  • Provided over 54,000 days of volunteering opportunities
  • Sponsored 330 apprentices
  • Spent more than £156 million on repairs and maintenance
  • Created nearly £4 billion of well-being benefits through visits to gardens.

Source: Historic Houses, 2023

Built heritage is significant pull factor for business

  • Using cross-sectional and longitudinal local authority data, research concluded that heritage assets are important ‘pull’ factors influencing business location decisions (Graves et al, 2017)
  • In a telephone survey of 509 businesses located in listed buildings, 62% of the respondents replied that the historic nature of their building improved their business. The main benefit of occupying a historic building is because it “contributes to the positive atmosphere of the surrounding area”. This is closely followed by the positive exterior appearance provided by the building. Both factors pointing to the importance of the flow of services from heritage assets and the positive impacts (known as externalities in economics) that tangibly benefit businesses and attract footfall (Historic England, 2018)
  • The same study found that the number of listed buildings occupied by a retail brand increased by 154% between 2012 to 2018. This indicates the value of heritage to brands and business identities. In fact, 69% of commercial listed building occupiers agreed that “Historic buildings give a positive image to customers and clients” (Heritage Counts, 2018)
  • A quarter of businesses (in a survey of 122 businesses) that had received investment in the historic environment agreed that the historic environment is an important factor in deciding where to locate (AMION and Locum Consulting, 2010)
  • Research by Cerisola and Panzera (2021) sought to determine the effect of cultural vibrancy, cultural heritage and the local creative economy on other economic outputs. The study found:
    • cultural heritage and creativity are in fact linked together and to development, especially at the territorial level
    • The mere presence of cultural heritage and facilities is not enough to trigger a spillover mechanism that significantly impacts the regional output. Rather it is the “activation” of material cultural heritage through participation that generates a positive effect on the regional economy
    • The authors conclude that heritage, both built and natural, seems to be a driving factor for both social cohesion and profitable long-lasting development
  • Neighbourhood-level data covering all of Sweden found that built heritage and cultural environments contributed significantly to the growth of highly educated individuals. This can improve regional growth (Backman and Nilsson, 2016)

Heritage led regeneration yields economic returns for local places

Heritage-led regeneration is about bringing the history of places to the surface, engaging communities in heritage projects and enhancing places with the aim of attracting new businesses, visitors and residents (Lichfields, 2021). Heritage-led regeneration projects are focused more than ever on reusing heritage assets in ambitious and creative ways to respond to changes in the way that people live, work and shop (Lichfields, 2021). Evidence shows that there are real economic benefits to this approach.

  • Piece Hall, a Grade I listed building, located in Calderdale, Halifax, West Yorkshire closed for restoration in 2014. It reopened in 2017 after securing a £22 million joint funding programme by the Heritage Lottery Fund, Calderdale MBC, the Garfield Weston Foundation and The Wolfson Foundation. The improved site is estimated to have increased Calderdale’s local GVA by £26 million since opening. This figure includes the direct and indirect economic contributions plus the non-use values and externalities. For every £1 of operating costs for The Piece Hall, the local economy benefits at least from £5.30. £3.30 is directly produced and £2.00 is indirectly generated by the Piece Hall (Chamberlain Walker, 2019)
  • Using a Transparent Economic Assessment model, the National Lottery Heritage Fund (NLHF) conducted an ex-post evaluation of six case studies from NLHF’s Heritage Grants Programme (2002 to 2007). The results showed a net GVA of £8.4 million generated annually and 135 direct and indirect jobs supported annually. Over the 10 years, this equated to £84 million GVA across just 6 projects. The combined grant awarded to these 6 projects was £27.5 million. This is a return of over 3 times what was originally invested. In addition, there were temporary economic benefits of £3.1 million net GVA and 70 net jobs created during the construction phases (Heritage Lottery Fund, 2017)
  • On average, £1 of public sector expenditure on heritage-led regeneration generates £1.60 additional economic activity over a 10 year period. These findings are based on a weighted average of the benefit-cost ratio of cumulative net additional GVA to public sector costs (AMION and Locum Consulting, 2010)

Case study: Shrewsbury Flaxmill Maltings

Shrewsbury Flaxmill Maltings is a historic site and home to the world's first iron-framed building (the Main Mill, above), known as the grandparent of the modern-day skyscraper. Established in 1797, it represents a story of resilience, decline and revival as an employment site for nearly 200 years. The site operated as a flax mill from 1797 to 1897, and then as a maltings until its closure in 1987. From 1987 to 2004, there were various failed attempts to regenerate the Flaxmill Maltings. However, continued vandalism and neglect resulted in it being placed on the Heritage at Risk Register. Historic England (then English Heritage) acquired the freehold of the site in 2005 in order to halt its further decline. With significant investments, including a £28 million National Lottery fund grant, the site and some of its 8 listed buildings have been restored for commercial and community uses.

Construction and Infrastructure

  • Net Impact:
    • The project supported approximately 283 FTE (Full-Time Equivalent) jobs during its construction phase
    • 129 of these jobs were directly linked to the site's construction
    • An additional 154 jobs were supported indirectly through supply chains
  • Total Impact:
    • In total, the funding for the regeneration project supported 552 FTE jobs
    • 252 of these were direct construction jobs
    • 300 were indirect jobs associated with supply chains

Economic Impact

  • The construction project has an estimated net Gross Value Added (GVA) impact of £32 million, localised to Shrewsbury
  • Overall, the project's direct and indirect impacts contribute an estimated £64 million to the UK economy
  • The redevelopment has resulted in the creation of 1,906 square metres of office space. 
  • The Main Mill , when fully occupied, is projected to generate an annual net contribution of £5 to £8 million to Shrewsbury's economy, equivalent to creating 78 to 109 full-time positions
  • The site's total potential economic activity stands at approximately £12 million annually, equating to the creation of 167 full-time positions

Community Impact

  • In 2022, crime rates within the Flaxmill Maltings area have fallen relative to the wider Shrewsbury area. Incidents of crime were down by approximately 27% in the area surrounding the Flaxmill Maltings compared to the Shrewsbury average between 2011 and 2021
  • Historic England has estimated that the reduction in crime could save police costs of around £40,000 a year if crime remains at this lower level in the area surrounding Shrewsbury Flaxmill Maltings. When considering cost of anticipation of crime, cost as a consequence of crime and cost in response to a crime there could be a social and economic saving of £520,000 annually

High street renewal and the important role of heritage

High streets have traditionally not only been the focus of local commerce, but also the backdrop to where communities gather. They were the cornerstone of community identity, bringing people of all ages and backgrounds together to buy, sell, eat and drink. Our high streets have witnessed unparallel challenges in the recent past with macroeconomic shocks from the COVID-19 pandemic, to the energy crisis and the cost of living crisis hitting high streets hard. In 2023, footfall on UK high streets was down by 16.8% on average from 2019 (Briggs, 2023).

These shocks have come on top of seismic changes in consumer behaviour brought about by technological advances including the growth in e-commerce leaving high streets reeling.  Heritage and heritage-led regeneration can play an important part of the future of our high streets providing authenticity, distinctiveness, bringing credibility to national and local place brands attracting people back to high streets (Heritage Counts, 2016).

In my generation as retailers, we successfully cloned every town in Britain so they all looked the same, but clearly that doesn’t work. All towns have a heritage and history and their reason for uniqueness needs to be brought to the fore.
Bill Grimsey, former head of Wickes, Iceland and Focus DIY (Hewson, 2018)
  • A study commissioned by Historic England (Lawton et al, 2021) considered the value of heritage in local place-making and the value that local people place on the heritage of their high streets. The research found that households within the catchment of high streets are willing to pay an estimated £6.31 to £7.80 per annum to maintain the historic character in good condition. The research used a contingent valuation methodology to elicit the value of heritage in high streets
  • The same study also presented results from other studies considering the importance of heritage to our towns and cities (Lawton et al, 2021): Garrod et al asked Newcastle-upon-Tyne residents how much they would be willing to pay (WTP), in extra council taxes, towards the renovation and restoration of buildings in the Grainger Town area, and how they would wish this money to be allocated across different areas of the town. The results of this study demonstrated a WTP of £11.68 per household, with evidence of a strong preference for renewing historic areas and a preference to contribute towards the improvement of the most degraded areas
  • This is in line with findings which suggest that willingness to pay (WTP) for historic buildings tends to decrease with their perceived condition. A study by Simetrica of historic cities found WTP values to preserve the historic buildings from damage associated with climate change in the city, including a use value of £9.63 per household among city visitors/residents, and non-use value of £6.14 per household among non-visitors/non-residents (in Lawton et al, 2021)
  • Evaluation evidence from the Derby Partnership Scheme in Conservation Areas (PSiCA) shows that while average footfall on high streets around the nation dropped by 26% between 2008 and 2013, the Derby PSiCA areas reversed a spiral of decline through heritage-led regeneration and saw footfall growth between 12% to 15% in the same period (Anarchitecture, 2017)
  • The Derby Partnership Scheme in Conservation Areas (PSiCA) programme also resulted in a fall in vacancy rates from 40% vacant in 2008 to 100% occupancy in 2017 (Anarchitecture, 2017). The PSiCA project offered grants for the sympathetic renovation of historic shop fronts using local tradesmen over an 8 year period

Coventry HSHAZ: Programme Evaluation

Historic England’s High Streets Heritage Action Zone (HSHAZ) programme is investing £95 million in high streets up and down the country to help bring people back to high streets. Run-down or derelict buildings in town centres and high streets reduce feelings of safety and belonging (Cattell et al, 2008; Hall et al, 2022). Buildings that are not well maintained are also more vulnerable to the effects of climate change (Department for Communities, 2022).

The HSHAZ funds will help make high streets more vibrant and exciting places where businesses can thrive, while also maintaining them as places where people from diverse backgrounds can meet and engage with each other (Lloyd-James, 2019). 

The HSHAZ programme is expected to end in 2024, leaving behind a legacy of long-term change and investment. Some headline figures from a demonstrator project in Coventry show:

  • Enhanced Engagement: Dwell time in Coventry increased notably in 2022/23 compared to 2019, increasing by approximately 19 minutes to 2 hours and 10 minutes in 2022/23, shown by mobile analytical data commissioned by Historic England. 
  • Stable Visitor Frequency: Despite challenges, visitor frequency in 2022/23 remained consistent with 2019 levels. This stability stands out, especially when compared to the average 18% decline in footfall across UK high streets in the same time period
  • Community Pride: There is a renewed sense of pride among Coventry's residents. A diverse demographic now actively engages with, appreciates, and celebrates England’s rich historic environment

Source: Historic England

Heritage enhances local property markets

The UK has the oldest housing stock in Europe (EU28), with 38% of the UKs homes dating from before 1946, compared to 29% in France, 20% in Italy, 11% in Spain and just 3% in Cyprus (Piddington et al, 2020). The condition of this building stock can have real impacts on broader economic outcomes and society.

  • A study by Dell’Anna (2022) concluded that when industrial relics, such as obsolete buildings, sites, enter into a process of adaptive reuse, they become transformation engines improving the lives of residents. This has a positive impact on the real estate market. The study used a hedonic model to estimate the impact of an urban regeneration project of an old industrial power plant site into a new corporate headquarters and museum/conference centre in Turin. The overall benefit within the 800 metre catchment of the site was €16,650,445 as a result of the transformation
  • A study of 160,000 data points for six cities in England found that proximity to a listed building increased property prices by between 4.4% and 10.3%. The study concludes that beauty, a sense of place, and confidence that heritage will not be destroyed bring real and predictable value (Boys Smith et al, 2017)
  • Academics at the London School of Economics surveyed 500 residents in 47 conservation areas and analysed property price data for 7,900 property transactions related to mortgages granted by the Nationwide Building Society between 1995 and 2010 to gather information on ‘attractiveness’ and ‘distinctiveness’. In conservation areas deemed to be distinctive, the authors found on average a positive price effect of approximately 10%. This rises to 12% in the most ‘distinctive’ conservation areas (Ahlfeldt and Holman, 2017)
  • Van Duijn et al (2016) provide evidence of a positive impact from the redevelopment of industrial heritage, with local house prices rising by 3.22% post redevelopment
  • There is a 23% price premium for homes in conservation areas. Research using a hedonic model analysing 1,088,446 house sales between 1995 and 2010 showed that properties in conservation areas sell for 23% more on average than other houses. Even when location, property features and other factors affecting house prices are adjusted for, a premium of around 9% was still found (Ahlfeldt et al, 2012)
  • A survey of estate agents found that 82% stated that original features added to a property’s value and 72% felt that original features helped ensure a quicker sale (English Heritage, 2009). 
  • Analysis shows that in 2016, house prices were 50% higher in town centre conservation areas, 33% higher in urban residential conservation areas and 22% higher in rural conservation areas relative to comparable non-conservation areas. (Noble et al, 2017). (Note: these are absolute price differences not controlling for other factors)
  • While there is a 9% premium on properties in conservation areas, this advantage falls by 4% to 5% in conservation areas that are classified by local authorities as being ‘at risk’. This evidence is based on a hedonic model analysing 1,088,446 house sales between 1995 and 2010 controlling for location, property features and other factors affecting house prices (Ahlfeldt et al, 2012)
  • The majority of conservation areas ‘at risk’ exhibit lower average property prices than those not ‘at risk’ (Noble et al, 2017)
The character of a place, like that of a human being, develops across time, and the older buildings of a place endow its character with a depth and complexity that it is difficult to achieve in developments built from scratch.
Ministry of Housing, Communities & Local Government, 2019


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