Sheffield academics Steve Fothergill and Tony Gore argue that gap funding for already-developed 'brownfield sites' is needed to make it worthwhile for the private sector to invest in bringing forward sites that are often of strategic importance but costly to develop.
They argue that any areas which want jobs and businesses need somewhere to put them but "unfortunately, the supply of development land is not always straightforward".
The report says: "A key problem in large parts of the North especially away from the big cities, is the weakness of the industrial and commercial property market.
"Low land values and low property rents mean that potential investments rarely offer the sort of return that commercial investors expect.
"Developing brownfield land, for example, is rarely commercially viable. The problem is negative land values – the cost of cleaning up and site preparation exceeds the value of the completed development-ready site.
"In these circumstances the private sector fails to bring the site to market. Additional complications in some parts of the North include watercourses prone to flooding, where the cost of flood defences means the private sector is unwilling to invest."
Last year, the Government announced that funds from the £400m Brownfield Land Fund would be allocated to the West Midlands, Greater Manchester, West Yorkshire, Liverpool City Region, Sheffield City Region, North of Tyne and Tees Valley to support around 24,000 homes.
West Yorkshire received £67m after signing a devolution deal and says the programme will help to build 4,500 to 6000 new homes over the next four years.
Calderdale leader Tim Swift said at the time that there was a "wealth of brownfield land across West Yorkshire that is ripe for development".
And he added: “Unlocking development sites and creating well-connected neighbourhoods that deliver much-needed affordable housing, is central to our aim to create a strong and growing economy that works for all our communities.”
The report says a plentiful supply of industrial and commercial buildings is also needed, supported by 'gap funding'. Most firms don’t have the option of commissioning new-build premises of their own because it takes too long so they rent or buy buildings already developed by someone else.
It adds: "In several market segments and in many parts of the North, private sector developers presently show a reluctance to invest in new quality workspace.
"They are sometimes willing to invest in large ‘sheds’, generally on the outskirts of towns and often with a specific big-name occupier signed up from the outset, but the private sector rarely if ever invests in speculatively built space for small firms, in incubator units for start-ups, or in high-quality office space in town centres."