Nestlé quashes claims over site

1:10pm Saturday 6th September 2008

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Nestlé boss Paul Grimwood has scotched rumours that the re-development of the York factory site is in difficulties, saying he is happy with progress being made.

The 170-acre complex has been divided up as part of the company’s massive restructuring of the York manufacturing operation, which also involved the loss of 645 jobs and departure of key brands including Smarties.

The southern end of the site, dubbed Nestlé South, where the original 19th century brick buildings stand, is set to undergo a mixed redevelopment creating offices, retail and residential properties.

The sale of the land is intended to help fund a major £20 million investment in the northern end of the factory, where modern, purpose-built buildings stand.

A new Aero plant opened there earlier this year.

Sources have suggested to The Press that developers involved in the scheme were pulling out in the wake of Britain’s growing economic difficulties, particularly the property market slowdown.

But Mr Grimwood, the company’s managing director, said today that it was still in dialogue with a number of developers regarding the future of the site.

“We are working with them and the council to maximise the benefit to both the local community and the financial return on the site,” he said.

“We are happy with the progress being made.”

When the redevelopment plans were announced by Mr Grimwood in 2006, he said the investment in the modern part of the site would safeguard the long-term employment of more than 1,800 remaining employees.

He said the redevelopment of Nestlé South could create 300 new jobs.

A development brief for the site has referred to the importance of creating a sustainable development with a strong sense of community and identity, opportunities to provide housing for families and single households, and respecting the character and setting of the site.

The credit crunch and property market slump has led to other developments in York being halted or delayed, including plans by Persimmon to build new apartments on part of the Barbican site and the next phase of the Hungate redevelopment.

At the time, Jeff Fairburn, Persimmon’s northern divisional chief executive, said: “As soon the mortgage market frees up, particularly for first-time buyers, we will commit to the scheme.

“But the Barbican needs a big cash investment up front before you get a return. It is important to remember that there are affordable elements in this scheme to cater for first-time buyers.”