Project Art Works
Arts & Culture Impact Fund Project Art Works is an Arts…
Arts & Culture Impact Fund
Creative Land Trust addresses the rapid loss of affordable workspace for artists and makers in London, targeting improved financial stability and wellbeing of artists and makers, enhanced sense of place amongst local communities and systemic change in the provision of long-term affordable creative workspace.
Creative Land Trust (“CLT”) is a charity set up in 2019 to address the rapid loss of affordable workspace for artists and makers in London. The CLT team sources viable property opportunities by building relationships with local authorities and property developers across London and seeks to acquire sites on a freehold, long leasehold or asset transfer basis. They then select experienced creative studio providers through a tender process to manage the sites on a day-to-day basis. CLT aims to support the sustainability and financial resilience of studio providers and their artist tenants by agreeing stable long-term leases that enable individual studio spaces to be let out at genuinely affordable rents (currently defined by the Greater London Authority as between £11-19 per square foot per annum). CLT’s mission is to secure 1,000 studio spaces that otherwise wouldn’t exist, and make them available for studio providers to rent to artists and makers. In 2021, it completed the purchase of its first site through initial seed funding received from the Greater London Authority, Arts Council England and Bloomberg Philanthropies – 33,000 square feet of space in a mixed-use development in Hackney Wick with the potential to provide up to 180 individual studio spaces.
The Covid-19 pandemic had a severe impact on the finances of creative studio providers which meant that very few had sufficient reserves or the ability to take on additional borrowing to fully fund the fit-out of new shell-and-core sites, particularly as supply chain issues were exerting upward pressure on the cost of building works. CLT approached the Arts & Culture Impact Fund (“ACIF”) for a £700k loan so that they could contribute towards the fitout of the initial properties in their pipeline and thereby alleviate the financial burden on studio providers and ensure that rental rates charged from end-user artist tenants stayed genuinely affordable.
Given this is a young organisation with an innovative (and therefore relatively unproven) business model and given that raising additional capital to fund the growth of the property portfolio is crucial for the long-term sustainability of the organisation, due diligence focused on the past professional experience of the team and Board, particularly in terms of their track record in raising both grant funding as well as commercial financing for property investments. The ACIF team held reference calls with local authority partners, the Greater London Authority and the studio provider selected to run the first site in Hackney Wick to understand their experience of working with the CLT team so far. The intention is that the ACIF loan will be refinanced once there is a sufficient track record of property management and rental income. Financial due diligence also involved running multiple worst-case scenarios such as difficulties in fundraising. The loan has also been secured against property to mitigate the risks around repayment.
CLT is targeting improved financial stability and wellbeing of artists and makers, enhanced sense of place amongst local communities and systemic change in the provision of long-term affordable creative workspace. Many creative studio providers tend to provide public-facing engagement such as arts workshops, exhibitions and open days. Some seek collaborations with local schools, colleges and community groups. Others provide mentoring or business support to their artist tenants. Understanding such social impact goals and activities forms a key part of CLT’s tender process when selecting studio providers and the lease agreements signed with them thereafter incorporate social impact KPIs. CLT also requires studio providers to embed principles of equality, diversity and inclusion and ensure that employees, tenants and any public programmes run at the studio sites reflect the diversity of the local population. One of CLT’s key aims is to create an evidence base of long-term social, economic and cultural value that will influence the attitudes of property and local government sectors towards affordable creative workspace to the extent that this is built into future planning and investment opportunities.