How do we better understand and measure the value of innovation districts? 

The social and strategic value that Innovation districts can offer to their communities, cities and countries is starting to be recognised but is notoriously hard to measure. 

Robert F. Kennedy famously said that GDP measures “everything except that which makes life worthwhile”. 

Yet much of the standard measures of success for innovation activity and innovation clusters tend to be heavily skewed towards similarly narrow indicators such as GVA, no. of jobs, no. of patents etc. Individually, there is nothing wrong with using such measures. But they don’t give us a collective or full picture of the value being generated.     

How then, can we attempt to establish a more holistic value assessment of innovation districts in situ? How can we better evidence the whole value return they contribute to the places in which they are embedded? And how do we show this over different timescales and geographical scales in a meaningful and more standardised way that allows us to learn deeply about each place but also draw trends and learning between places? 

These were some of the very questions that the UK IDG set out to answer this year. The development of impact measures for Innovation districts became our primary research enquiry for 2023 – following on neatly from our previous research commission in 2022 on The Case for Inclusive Innovation in the UK.  

The case for why we need this sort of thinking is increasingly clear and is driving renewed focus on measuring the impact of innovation districts. Public, academic partners and increasingly private sector partners all wish to qualify and demonstrate the socio-economic value return of investing in Innovation Districts. Investors are looking for tangible measures to assess and compare innovation districts. City and district leaders need to demonstrate progress and potential to prospective funders, tenants and backers – as well as crucially to local businesses and residents.

So, there is a critical need to understand how best to frame success, gather data, and monitor progress. For this reason, the UK IDG with funding from CPC, commissioned The Business of Cities to undertake this work with the aims of:

  1. Producing a deep data dive for member district
    Robust and relevant data points that give a fuller read on the status and value of each Innovation District in situ. Go beyond standard GVA or occupancy stats to include a blend of metrics that work across the three interrelated value themes of: Innovation, Place & People.  Develop a framework that shows change over time and geography which helps isolate the added value of the innovation district in relation to its context. 
  2. Create a more consistent approach to place-based innovation value metrics
    Establish a more unified model for UK Innovation districts to help spot common patterns and trends and learn with each other. 
  3. Use evidence to inform conversations
    Use this evidence base to have focused conversations with city, regional and national government policy makers. Specifically linking into the UK Innovation cluster mapping work and thinking through broader applications connected to Innovation accelerators and Investment zones for example.

This work consisted of a global review informed by the UK IDG’s experiences and data architecture specialists. It also analysed the most appropriate blend of publicly vs privately available data sources, quantitative vs qualitative research work – with clear rational and guidance for each. The resulting data framework has now been produced and is being adopted by individual member districts. 

This will help individual innovation districts to:  

To find out more about this work please get in touch at hello@ukinnovationdistricts.co.uk or email Borane Gille boranegille@thebusinessofcities.com

What a fantastic two-day UK Innovation Districts Group study visit bringing members together covering two of our member innovation districts: Knowledge Quarter & SHIFT London. 

Day 1 kicked off at The Mills Fabrica based in the Knowledge Quarter

Some highlights include…
? Seeing the Diversity, Equity and Inclusion scorecard we have developed with Variety Pack for members to use & implement in their own districts
? Hearing more about the exciting plans of the Inclusive Innovation Network & the Inclusive Innovation children’s book
? Building our relationship with Innovate UK in order to strengthen place-based #InclusiveInnovation
? Discussing the development of our metrics & measures framework by The Business Of Cities
?️ Going on a unique hard-hat behind the scenes tour of the Google building in Kings Cross

Day 2 of the study visit took us to Queen Elizabeth Olympic Park the site of SHIFT; London’s Living Testbed. 

Some highlights include…
? A tour of the Olympic Park showcasing some of the #innovation trials that have taken place in the last 12 months focused on #Mobility, #Climate and #Health solutions
? Visiting the UCL Robotics Centre in action and seeing first hand how important interdisciplinary working at scale really is
? Exploring the vast innovation skills agenda 
? And of course our member meeting discussing all our exciting future plans – watch this space!

Bringing people together to share knowledge & accelerate place-based inclusive innovation is what the UK IDG is all about and we know that so many conversations & actions will come from this study visit.

Glasgow has been chosen as the host city for the 2024 International Association of Science Parks and Areas of Innovation European Division Event which will be held at the University of Strathclyde.

The winning bid, announced at the closing session of the 2023 IASP European Division Event in Reykjavik on Friday 5 May, was submitted by Glasgow City Innovation District (GCID) and will see IASP members from across Europe gather to share knowledge on how to help science parks and innovation districts to thrive.

GCID – Scotland’s first innovation district – is a hub for entrepreneurship, innovation and collaboration which is building on Scotland’s rich tradition of scientific excellence and industrial ingenuity.

Located in the heart of Glasgow City Centre, the District – a partnership between Strathclyde, Glasgow City Council, Scottish Enterprise, Entrepreneurial Scotland and Glasgow Chamber of Commerce – is home to innovative companies and organisations. GCID joined IASP in 2022.

Founded in 1984, IASP’s mission is to drive growth, internationalisation and effectiveness for its members by coordinating an active network of managers of science/technology/research parks and innovation districts in 79 countries, and enhancing new business opportunities for members and their companies.

The IASP is a worldwide membership-based association that is an independent, non-profit, non-governmental organisation in Special Consultative Status with the Economic and Social Council of the United Nations.

Alisdair Gunn, Project Director of GCID, said: “We are absolutely thrilled to have been chosen as the host city for next year’s IASP European Division Event.

“As recently-joined members of IASP we are eager to fully maximise the benefits that membership brings and we are excited to welcome delegates from across Europe to Glasgow City Innovation District to showcase what we are doing, but also to learn from our peers.”

Salvatore Majorana, European Division President of IASP, said: “Congratulations to Glasgow! I look forward to discovering the city and its innovation ecosystem at our next European Division Event in 2024, where colleagues from across Europe will have the opportunity to share experiences and best practices, generate synergies and build international relationships to expand their networks.”

Ebba Lund, IASP CEO, said: “We’re delighted to see a relatively new member like Glasgow City Innovation District embracing the opportunities our international community offers to put their district and city in the spotlight, and share their knowledge and experiences with us. IASP is proud to represent a growing number of urban innovation districts, and we warmly invite all our European Division members to join us there to learn more about Glasgow and connect with our innovation community.”

The second Glasgow Tech Fest saw more than 300 delegates gather to share ideas around growing the city’s burgeoning technology sector.

More than 300 delegates attended the event on 19 April, organised by Glasgow City Innovation District, and held in the Technology & Innovation Centre at the University of Strathclyde.

The event focused on five key themes: impactful innovation, market dynamics, ecosystem development, commercial strategies, and growth leadership.

The packed agenda saw speakers including: TV presenter and journalist Spencer Kelly; Bayile Adeoti, Founder of Dechomai and President of Scottish Women in Business; Alison Porter, Portfolio Manager at Janus Henderson Global Investors; Dominic McGregor, co-founder of Social Chain and founder of Fearless Adventures; and Professor Janice Kirkpatrick OBE, Creative Director of Graven share insights on successful innovation and collaboration.

Amongst the key takeaways from Glasgow Tech Fest were:

Following the success of the 2023 event a date for next year’s Glasgow Tech Fest has already been set for 16 May, which will coincide with Glasgow Tech Week which will run from 13-17 May.

Glasgow City Innovation District will be the founding partner and lead organiser of the Week which will be a celebration of the technology being developed across the city from the founders, leaders and businesses involved in developing them. The format will be a week-long festival that will showcase the expertise and development of Glasgow’s Tech sector and offers the city’s tech ecosystem the opportunity to come together and collaborate on growing the City’s innovation economy.

GCID Project Director Alisdair Gunn said: “Our second Glasgow Tech Fest was a huge success and we’ve received wonderful feedback from attendees. It is clear this event is a popular forum for tech companies in Glasgow City Innovation District and the tech ecosystem beyond to share their ideas and network.

“Over the coming months we will be engaging with partners from across the tech and innovation ecosystem to invite them to support, curate and host their own events as part of Glasgow Tech Week”

“Glasgow Tech Week will be the first of its kind for any city in Scotland and will be open to partners who are involved in developing Glasgow’s key industry sectors as well as those who support the growth and investment of technology businesses from across the Glasgow City Region.”

The Spring Budget had a lot of focus on innovation-led growth. Twelve new low-tax investment zone areas were announced in an effort to kick-start the UK economy and boost growth by introducing specific tax and regulatory rules. 

Although more detail is yet to come out, what seems promising about the refocused investment zones approach is that they don’t just focus on tax and regulation, they also reference skills and infrastructure as part of the support package. Closer alignment of skills and innovation investment is something the UK Innovation Districts Group has been championing for a while. Another positive to take from the emerging Investment Zones is the focus on “bold and imaginative partnerships between local Government and research institutions”. It’s good to see the importance of partnership development and place governance come to the fore, as this is an essential component of successful innovation districts.  

Another essential component of innovation clusters of all kinds is the strength of the networks they hold. With this in mind, a welcome addition to the Investment zones model could be support programmes akin to the REAP MIT model that focus on network building and activation across an innovation district. 

The zones are clustered around research institutes such as universities of which eight English locations have been identified as eligible to host an investment zone and a further four will be identified in Scotland, Wales and Northern Ireland. 

The eight areas in England are all located in Northern England continuing the government’s levelling up commitment to increase domestic public R&D investment outside the Greater South East by at least 40% by 2030. Each Investment Zone will receive £80m over five years – nearing a £1bn investment to these twelve areas in government support. This money can be used to “offer tax incentives or to improve skills, provide specialist business support, improve the planning system or for local infrastructure in the zones.”

Jeremy Hunt’s pursuit of ‘prosperity with purpose’ speaks to the UK IDG’s inclusive innovation agenda that highlights the case for as many people as possible to contribute to, participate in and benefit from the UK’s innovation economy in terms of the design, delivery and diffusion.  We need to see much more of this, with intentionality and focus, if we are to achieve real prosperity with purpose. And the new investment zones too must consider how they help deliver on this agenda. As acknowledged recently by Tom Bridges in his guest blog, there are a number of factors that will determine the success of investment zones.

Investment Zones’ success will depend on…

?️ Ensuring greater public sector R&D investment to crowd-in business investment

? Getting the fiscal incentives right

? Introducing faster planning, not less planning

? Working together to develop the right mechanisms for sharing risk & reward

? Linking innovation assets in major city centres with those in surrounding areas

? Thinking beyond bricks & mortar


Congratulations to UK IDG members and supporters including Liverpool, West Yorkshire, West Midlands, East Midlands, Greater Manchester, South Yorkshire, Tees Valley and North East for being among the twelve identified areas for investment zones. We are looking forward to learning with you and supporting you along this journey.

Tom Bridges is UK Government and Innovation Leader, Leeds Office Leader and Director at Arup

In a positive step, the UK Government has launched what it calls a “refocused Investment Zones programme….aimed at catalysing a small number of high-potential clusters in areas in need of levelling up to boost productivity and growth.” Investment Zones are now being focused on growing knowledge-based clusters and innovation districts, which can become homes to highly productive, research intensive businesses. There is consensus across the political spectrum to make the UK a ‘science superpower’, and to grow clusters and sectors where the country has particular strengths. With growing momentum and ambitions plans around innovation districts in UK cities, the refocused approach to Investment Zones has great potential.

As cities and combined authorities prepare to respond, we suggest five actions that will shape successful schemes:

1. Identify the right locations and sectors

Identifying the right locations and sectors will be critical. The “core” spatial focus (where tax and business rates retention sites will be located) should be “where interventions should focus on facilitating co-location of businesses, fostering collaboration between industry and research institutions, and driving innovation in companies at the frontier of the target sector.” There should be a focus on one of five target sectors (digital, life-sciences / med-tech’ creative, green industries, advanced manufacturing). Positively there is scope to consider linkages and common features (for example around specific technologies and skills) across sectors, which is to be welcomed, recognising that our largest cities often have a related diversity of sectoral strengths.

This all points to the need for Combined Authorities to be hard-headed and evidence-based in identifying their genuine sector strengths, and the locations with the strongest research capabilities and greatest scope to crowd-in private sector investment. Based on the guidance in the IZ Policy Prospectus, this is likely to point towards the innovation districts in the centres of the core cities, as well as linked sites that have capacity and potential for large scale job growth and investment in functions like manufacturing or lab space that are not always possible to develop in city centres.

Places should also avoid the temptation to spread Investment Zones too widely across sites with weak functional economic linkages and places with limited research strength and investor appetite. Instead, proposals should set out how wider supply chains, skills and opportunities can be created across wider functional economic areas, linked to the “core” areas of spatial focus. Interventions could include business support and innovation initiatives, educational institutions and collaborations linked to the strengths of the core of the investment zone, and skills initiatives. This could be part of a wider approach to encourage inclusive innovation.

2. Adopt the right mix of incentives and public sector investment

It will be essential to get the mix of fiscal incentives and Government spending right, with places having access to incentives and flexible government funding of up to £80m over five years. The availability of flexible spending to support initiatives such as research and innovation, skills, local infrastructure, enterprise and planning and development can really help places support growth (the fact 40% of this spend will be revenue is particularly positive).

The proposals to allow 100% local retention of business rates growth in Investment Zones for 25 years is another powerful tool, which places could seek to use to create an income stream to borrow against to reinvest in local infrastructure and economic development. The Enhanced Capital Allowances can be an attractive incentive, particularly for investment in manufacturing and labs, but places will need to identify sites suitable for those uses. Other tax reliefs could include business rates relief, enhanced structures and building allowances, and employer National Insurance Contribution Relief. However, the cost of all these incentives (capped at £45m over five years) are to be deducted from the overall £80m financial envelope over five years.

The strength of the local innovation ecosystem, skills base and the availability of premises are likely to be more important for knowledge-based businesses than some small-scale fiscal incentives, which perhaps points to places seeking to retain more flexible spending. As the LSE’s Neil Lee has argued, the appeal of Investment Zones needs to be about more than cost efficiency, citing the fact that Google’s largest European R&D facility is in high-cost Zurich. Places should mitigate against the big risk that fiscal incentives cause displacement of economic activity, or deadweight (activity that would have happened anyway). It will also be necessary to consider risks under subsidy control law.

3. Accelerate planning and development by providing certainty

Places should introduce faster planning, not less planning, and focus on increasing the supply of the right types of commercial space. By setting out a clear and flexible spatial framework, places can provide greater certainty to investors, sending clear signals to investors, and help ensure the right quality of development with good public realm and green infrastructure. Robust design codes can also provide clarity and certainty and send the right signals to the market on the nature of ambition, the economically productive uses, and quality of development being targeted. Local Development Orders and / or Planning Performance Agreements have a role to play.

Councils, Combined Authorities, Homes England and the UK Infrastructure Bank should work together to develop right mechanisms for sharing risk and reward with private sector to get more office, innovation / lab, & manufacturing space built, which as the Centre for Cities has rightly said, is really needed.

4. Think beyond bricks and mortar – build the partnership and ecosystem

Beyond obvious investments in bricks and mortar, there should be a focus on developing the softer ecosystem that is required to commercialise innovation. One of the notable and very positive features of the IZ Policy Prospectus is how it emphasises the importance of government at all levels working with the private sector, universities and other research institutions, to create the right environment and culture of collaboration for successful cluster growth. As MIT has shown through its MIT REAP – Regional Entrepreneurship Acceleration Program framework, you need to identify activate a range of different actors and groups to be successful: universities and other knowledge producers; entrepreneurs; corporates; investors of risk capital; and government itself. In short, we need to do the D not just the R. This means that successful Investment Zones will need strong partnerships with the right players around the table and places should identify current gaps and weaknesses in their local ecosystem.

Universities are at the heart of the proposals, strengthening their civic roles, alongside their traditional research and teaching roles. They will need to engage with the Investment Zones proposals, align their own investments (including capital spend) and help lead development. Universities should consider taking equity in spin-outs; there are some suggestions that current approaches hold places back. Investment Zones have the potential to use universities to attract inward investment.

There is potential to adopt a mission-orientated approach, building partnerships and innovation initiatives around tackling societal challenges, such as responding to climate change, improving health outcomes, enhancing mobility and access to services, or tackling social exclusion. Firms respond to future profit, market and growth opportunities where there is societal need. These can be fostered by government and universities.

There’s value here to developing a network of testbeds in Investment Zones – these would enable innovators and entrepreneurs to test their proposed solutions and use cases in real-world conditions.

5. Develop strong local leadership and strategies

It is clear that successful Investment Zones will need clear, coherent and compelling strategies, based on evidence, realistic proposals and projections for future change, and around which partners can build a coalition and shared commitment. This will need to be positioned within the context of wider strategies and plans for growth, and critically where the private sector is likely to invest. Dedicated leadership and delivery capacity will be needed.

There is scope to learn from successful innovation districts globally, and also the ambitious CHIPS and Science Act in the US. Monitoring and evaluation plans should also be factored in from the start, with a clear theory of change, and particular attention needed on assessing displacement and substitution effects.

All this will require local authorities and CAs to focus on being convenors and catalysts, not controllers, to work with and through others to achieve a positive impact disproportionate to the powers and resources under their direct control. Investors, entrepreneurs, and R&D-intensive corporates. The real prize here is not the £80m of public sector investment; it is the potential to benefit from billions in private sector investment and create thousands of jobs.

Investing in a better future

Refocusing of Investment Zones on innovation and clusters is really positive, and the package of policy, fiscal funding available creates a major opportunity for the UK to adopt an ambitious development model, one that brings national investment to develop the breadth of local potential. This is a huge opportunity for our cities and city regions, and ‘UK plc’.