How the UAE reshaped Manchester, from Arab Spring fallout to Andy Burnham's city

In the summer of 2013, Manchester city council was handed an unusual homework assignment. David Cameron's government, anxious to calm relations with the United Arab Emirates, asked the council to draw up three investment proposals for the oil-rich state. The anxiety traced back to the Arab Spring: after Hosni Mubarak fell in Egypt in 2011, he was succeeded by Mohamed Morsi of the Muslim Brotherhood, an enemy of the UAE's rulers. The emirates, a key western ally, worried that Cameron's government was too soft on the Brotherhood and warned it could pull billion-pound arms deals. A secret Whitehall unit was set up to keep Abu Dhabi on side, and lucrative investment offers were made in private meetings later revealed by the Guardian.

One of the three Manchester proposals became Manchester Life, a £1bn scheme. The council sold a prime slice of city centre land to Abu Dhabi for £5m, to build 6,000 homes, and gave it a right of first refusal on other projects. Richard Leese, then council leader, told the Guardian it was a government-brokered deal and that housing development around the centre and Ancoats had stalled for years, with no other developers willing or able to act. He called it a world-class exemplar of regeneration.

The delivery has fallen short. Manchester Life has built 2,039 homes, a third of the promise, and other developers are building a further 2,839. The total of 4,878 is nearly 20% under the 6,000 envisaged. The council's policy calls for at least 20% social and affordable housing, but only 8% of those homes qualify, and none came from Manchester Life. A Guardian analysis finds that land and property held by the UAE government or Emirati developers in Manchester rose 39% over ten years, peaking in 2023 at the size of 260 football pitches. Sheikh Mansour bin Zayed al-Nahyan, owner of Manchester City, now holds the UK's biggest indoor arena, a hotel that opened last month, apartment blocks, and a stake in university research through a firm run by City chief executive Khaldoon al-Mubarak.

A five-minute walk from the Abu Dhabi-funded flats, home to the city's first Michelin-starred restaurant, a former Methodist church nave is stacked with emergency food. The route to the Etihad Stadium crosses some of the poorest areas in England's second most deprived local authority, with four food banks or distribution sites within half a mile. Mark Blake of Manchester Central Foodbank says the contrast is bound to cause resentment during a cost of living crisis. Parking has become a flashpoint, with reports of cars vandalised on council estate streets. Lib Dem councillor Alan Good says residents feel they are not sharing in the city's gains, and that Manchester is becoming a northern version of London, with 20,000 people on the social housing register.

Questions of transparency run through the story. In December 2015 the council signed a 10-year collaboration agreement giving Abu Dhabi first refusal on land near the centre, with a clause barring the council from announcing the deal without written approval from Sheikh Mansour's firm. A council spokesperson called it a standard agreement. The property, worth an estimated £350m, is owned through Jersey subsidiaries. The council says it received nearly £3m under an undisclosed profit-sharing arrangement and £17.6m in council tax, but the precise return to taxpayers is unknown. University of Sheffield researchers concluded the council sold the family silver too cheaply; the council denies a sweetheart deal. A senior former officer described a culture of no dissent, while Leese, who became honorary president of Manchester City two years after leaving office in December 2021, denied favouritism: that is the way the city works, in partnership.

In 2017 the council paid £42m for a retail park beside the Manchester Life site, at least six times the per-acre price Abu Dhabi paid. It is now earmarked as the home of Andy Burnham's No 10 North. Property officer Dominic Hayes resigned in March 2018 over the council's dealings with Mansour's group.

Burnham, who as mayoral candidate in 2016 criticised loans to big firms and luxury schemes, approved a £55m loan to Jersey-registered firms owned by Sheikh Mansour barely a year later. The loans were repaid in full, and GMCA says they were open to all qualifying developers, but GMCA scrutiny councillors are now investigating. Burnham also enjoyed City hospitality weeks before approval, and five further meetings with the club's bosses have emerged beyond the one he first cited. He has ordered a manual trawl of records and promised full transparency, which is the test to watch next.