£100m milestone for Building Scotland Fund

Housing, regeneration and industrial and commercial developments are being supported by investments of £100 million through the Building Scotland Fund (BSF).

The fund, backed by £150 million in total, was established as a precursor to the Scottish National Investment Bank and has the same values, principles and ambitions.

Economy Secretary Derek Mackay marked the milestone with a visit to see progress made on the refurbishment of the 55 Douglas Street office development in Glasgow, which has benefitted from £12 million from the fund. 

Mr Mackay said:

“I am delighted that the Building Scotland Fund has now agreed investments of £100 million, unlocking projects in excess of £238 million and providing a significant boost to the Scottish economy.

“This milestone is an important step not only for the Building Scotland Fund but also lays a strong foundation for the Scottish National Investment Bank – paving the way for it to become a cornerstone institution for Scotland’s economy.

“A total of £25 million of BSF funding is being invested in projects through the SPRUCE urban regeneration fund. This includes the new high-spec refurbishment at 55 Douglas Street which is helping to revitalise Glasgow’s city centre and bring additional capacity for business and jobs.

“BSF has also agreed investments of £75 million in a range of housing projects, from large-scale transformational projects to smaller developments being delivered by small to mid-size enterprise housebuilders. This is supporting the development of more than 5,500 homes and around 600 full time jobs.”

Gareth Richardson, director of asset management at Signal Capital, owners of 55 Douglas Street, said:

“The funding we have received through the BSF has been invaluable. Without that level of investment we would not have been able to maximise the potential of the building by creating a 10,000 square foot extension, providing larger floor plates and a complete transformation of the front exterior. This much needed additional space will help address Glasgow’s critical shortage of high quality office accommodation, enabling the city to attract and retain occupiers which in turn encourages economic growth.”

Background

The £150 million Building Scotland Fund is a precursor to the Scottish National Investment Bank and reflects the principles behind it. The BSF is available to non-public sector organisations - including businesses, housing associations and universities - to support the development of house building across all tenures, to develop industrial and commercial space and support business-led research and development.

Scottish Enterprise, Highlands and Islands Enterprise, the Scottish Funding Council and the Scottish Futures Trust are working with the Scottish Government to deliver the fund and bring forward a pipeline of projects.

£25 million from the fund is supporting further investment by SPRUCE (Scottish Partnership for Regeneration in Urban Centres). SPRUCE is an evergreen fund, managed under an agreement between Scottish Ministers, the European Investment Bank (EIB) and Amber Infrastructure, which invests in regeneration, property and sustainable energy projects across Scotland.  

The SPRUCE fund was originally set up with Scottish Government and European Regional Development Fund (ERDF) funding under the European Commission’s JESSICA (Joint European Support for Sustainable Investment in City Areas) initiative.

Since 2016, SPRUCE has been recycling the original capital, as well as investing additional public and private sector funds, into eligible projects.