WEARSIDE developer Hellens Group has started work on a major new project with backing from the North East Local Enterprise Partnership.
The £2.6m West Chirton project will create a 34,000 sq ft 17-unit space for businesses close to the A19 in North Tyneside.
The project, expected to employ more than 150 people during its building phase, is due to be completed by June next year.
It has been made possible by a £460,000 loan for the partnership’s North East investment fund.
Hellens also received £1.1million backing from the European Regional Development Fund (ERDF).
Chief executive Gavin Cordwell-Smith said the firm had been trying to get the scheme off the ground for years.
“The banks aren’t lending for speculative property-building even where there is a proven case and proven demand,” he said.
“The site is land we already owned and had bought, pre-credit crunch, to develop. The project was stalled for five years because we couldn’t get funding.
“It’s a very good location close to the A19 and just north of the Tyne Tunnel, off the Silverlink roundabout.
“The offshore and manufacturing sectors are active on the north side of the Tyne at the moment, and we hope to pick up demand from businesses for accommodation.”
Hellens, a Washington-based firm specialising in land and property regeneration, is nearing completion of its £1.2million Teal Farm development in the town, a project also boosted by a £200,000 Growing Places Fund loan and a £680,000 ERDF grant.
“At Teal Farm, we had built a previous terrace in 2008 and let it at the height of the recession, but you still can’t get bank finance even though the demand is there,” said Mr Cordwell-Smith.
“The partnership’s help has been vital. Without it, we wouldn’t be building the business parks.
“We are very grateful to the partnership for supporting us.
“These are the first two speculative developments in the North East since the credit crunch.”
Jeremy Middleton, chairman of the partnership’s investment panel, said: “Hellens Group’s two business park projects are precisely the kind of developments that the North-East investment fund was set up to support.
“Both Teal Farm and West Chirton are well-located and well-thought-out developments which will provide quality workspace for new and growing businesses in North Tyneside and in Washington.
“They have created jobs during the construction phases and will provide accommodation for further job creation once they are occupied.”