Weekly planning news from the central London boroughs
This new digest has been prepared on behalf of London Property Alliance by Concilio communications consultancy as part of a service agreement to provide information for our members.
City of London
Property Week reports that London’s financial districts must seek ways to boost post-Covid occupancy rates. Matt Ross reports “We’re in the foothills of change,” says Philip Pearce, chairman of Savills’ central London office agency team, reflecting on the post-Covid return to the office. His comments sum up a general consensus among those in the market that while working practices will not return to business as usual after the pandemic, it is still too early to judge exactly where the capital’s office sector will land. Certainly, many staff in London’s main financial districts still work regularly from home. During February and March, weekly occupancy rates ranged from 18% to 27% in the City and 15% to 36% in Docklands, according to data from Savills. According to Pearce, most offices that used to run at 60% to 65% capacity now struggle to reach 40%, meaning that there is a “missing 20%”, which is probably largely accounted for by those with long commutes, as well as older and more senior staff. Suzanne Gill, a partner at Wedlake Bell, says that in this uncertain environment many businesses are “waiting to see how flexible working plays out among their staff” before committing to new leases. While leasing volumes picked up earlier this year, vacancy rates remain high – having risen from 5% to 9% in the City since 2019 and from 11% to 14% in Docklands, according to Savills. The City subletting market has fared particularly poorly, with available floorspace rising from 1.8m sq ft to 3.2m sq ft over the two years to March.
City of London Council reports that new data collected by City residents has shown a 40% improvement in air quality at two Square Mile housing estates. The Science In the City air quality monitoring project, run by Mapping for Change and commissioned by the City of London Corporation, took place at the Barbican and Golden Lane estates. The scheme compared 2021 data on nitrogen dioxide (NO2) against figures collected by residents on the same sites in 2013 to see if local air quality had improved. NO2 is produced through the burning of fuel, including by vehicles, boilers, and power plants, and is damaging to health and the environment. The project asked residents their opinions on air quality in 2013, and what type of action they would like to see from the City Corporation. Their views helped the Square Mile’s governing body bring in a Low Emission Neighbourhood programme, with its new electric vehicle charging points, green infrastructure, cargo bikes, and a zero emission street pilot. The City Corporation has since banned new diesel vehicles from its own fleet, where there is a clean market alternative, and led a London-wide crackdown on drivers who leave their engines idling when parked.
Hackney
Hackney Gazette reports that Hackney Council has launched a 12-week consultation to improve the delivery of its housing services and the way it listens to residents. The consultation period opened on Thursday, June 9 and will run until Sunday, September 4, allowing Hackney residents to have their say on the council’s draft resident engagement strategy. This was created after surveys taken by thousands of residents last year, along with focus groups and informal discussions, highlighted a need for the service to improve the way it engages with them. Councillor Clayeon McKenzie, cabinet member for housing services and resident participation, said: “I want our housing services to be much more responsive to our residents’ concerns and suggestions and ensure we have a culture where every resident’s voice is valued and respected. “People living in our homes need to have the confidence that we are listening to their feedback and acting on it.
Islington
Property Week reports that workspace provider HB Reavis has taken a £138m green loan with HSBC to refinance its central London building Bloom Clerkenwell, the London HQ of messaging app Snap Inc. Bloom Clerkenwell, which is adjacent to Farringdon underground and overground station, has been awarded a BREEAM outstanding accreditation, is rated EPC A and is targeting net-zero carbon in operation. HB Reavis said the nine-floor building prioritises wellbeing, with 11% of the building being accessible outside terrace space, one of the highest ratios in London, 248 bicycle spaces at street level accessible directly from the Cycle Superhighway, health club-style changing facilities and a fitness studio. Around 115,000 sq ft of Bloom Clerkenwell’s 145,000 sq ft of space has already been leased to Snap, while Ready to Work – the fully fitted, managed and tech-enhanced office space on the first floor – has been leased by two undisclosed sustainably minded businesses.
Kensington & Chelsea
New Civil Engineer reports that Transport for London (TfL) is fighting to keep its South Kensignton regeneration plans alive. As reported by NCE-sister title Architects’ Journal, TfL and development partner Native Land have lodged an appeal after the council rejected plans for a mixed-used scheme above and beside South Kensington Underground station. The proposal – drawn up by Rogers Stirk Harbour + Partners’ (RSHP) – for shops, offices and 50 homes around the west London tube station was thrown out by Kensington and Chelsea Council’s planning committee in November 2021 despite planners recommending its approval. The decision came after the plans were amended three times and put through six rounds of consultation by the client, a joint venture between TfL and Native Land. The plans also faced fierce local opposition, with 22 local groups, five councillors and the local MP opposing them. Kensington and Chelsea’s planning committee chair James Husband said the scheme was rejected due to the “impact of the architectural design, height and massing of the proposals on the conservation area and listed building”.
Southwark
Architects Journal reports that John Robertson Architects (JRA) and Studio RHE have unveiled plans to replace a controversial glass warehouse extension designed by Renzo Piano with a more ‘considerate’ brick version. The original scheme, for Shard developer Sellar, proposed turning 40-44 Bermondsey Street into a modern office campus with a towering glazed extension on a neighbouring warehouse at Vinegar Yard. But local residents described the scheme, designed by Renzo Piano Building Workshop, as ‘gratuitously clumsy’, and when the site was sold on, new owner Aviva Investors opted to change tack. Following a ‘listening exercise’, the developer, which has retained Sellar as co-developer, hired JRA and Studio RHE last year to take over design work on the redevelopment (see Renzo Piano dropped as controversial Bermondsey scheme faces redesign).
Wandsworth
Property Wire reports that Peabody is delighted to announce the upcoming launch of its new Shared Ownership apartments at Willow Walk in Wandsworth. Perfectly positioned to enjoy a range of eateries, bars and green space, these new homes mark the final stage in the transformation of the Wandsworth Riverside Quarter. With share prices starting from £130,000, homes at this stunning development are due to launch on 11 June. Willow Walk is a contemporary collection of one, two and three-bedroom apartments available for purchase through Shared Ownership. Spacious interiors feature large windows that perfectly capture breath-taking views across the city; All apartments benefit from the added luxury of a private balcony while residents can also enjoy use of private communal gardens. Inspired by the osier reeds that once thrived in this location, the soft landscaping at the development’s spectacular plaza coincides harmoniously with the buildings’ design and brickwork.
Westminster
Property Week reports that Capital & Counties (Capco) has agreed the deal to complete its reverse takeover of Shaftesbury, which will create a combined company worth around £3.5bn. The all-share deal will result in Capco owning 100% of the company despite having a market value half that of Shaftesbury. Shaftesbury shareholders – other than the holders of the existing Capco shares – will own 53% of the combined group, with Capco investors holding the remaining 47%. The holdings take into account the relative net tangible assets and market capitalisations of both companies. Capco already holds 96,971,003 Shaftesbury shares, representing approximately 25.2% after paying Hong Kong tycoon Samuel Tak Lee £436m for his position in the company in May 2020. The combined group will be called Shaftesbury Capital, and will create a REIT with a portfolio of 2.9m sq ft across assets in Covent Garden, Carnaby, Chinatown and Soho.
Property Week reports that the property industry has hit back at Westminster City Council’s (WCC’s) claim that landlords are turning a “blind eye” to the influx of US-themed sweet shops along Oxford Street, after the council launched a probe into 30 candy stores for alleged non-payment of £7.9m in business rates. WCC wrote to 28 landlords on the central London street, from whom the stores are sublet, saying that it was “stepping up pressure on landlords to make it clear they are responsible for Oxford Street being overrun with these kinds of stores”. WCC leader Adam Hug described the sweet shops as a “threat to the status and value of what is supposed to be the nation’s premier shopping street”. In reference to the issue of unpaid business rates, he added: “The problem is that owners of buildings are turning a blind eye to those who sublet them as it means they are not liable for business rates. That’s why we have a rash of US candy stores in prestige locations.”
Property Week reports that Developer Qatari Diar has secured a £400m green loan for phase four of the Chelsea Barracks development in Westminster, which will provide 32,000 sq ft of amenity space and 97 new apartments. The interest rate risk on the loan was fully hedged through a green derivative structured on the basis of the building’s LEED certification status. The financing is provided by a consortium of five lenders: Credit Suisse, Standard Chartered, Allied Irish Bank (GB), Qatar National Bank and National Bank of Kuwait. It is aligned with the Green Loan Principles (2020) as set out by the Loan Market Association and ESG derivatives standards. Tariq Al Abdulla, chief development and project delivery officer (Europe and America) at Qatari Diar, said: “Securing the development loan for phase four of Chelsea Barracks, and having it classified as a green loan, is an important milestone for the project and one we are extremely proud of.
Fitrovia News reports that Westminster Council has validated four planning applications in the Fitzrovia Neighbourhood Association amenity society area so far during June 2022. (This list will be updated with new applications until the beginning of next month.) Included among the monthly list is an application for a roof extension at Malvern House 15-16 Nassau Street; air conditioning units at 12 Great Portland Street. To view the applications and make a comment, use the monthly list below and the links to the full application on the council website. There is a limited time to submit comments. If you have trouble with the link not working, use the application reference number and search Westminster’s planning website. The monthly list we publish is pulled from the council’s website and is correct at the time of publication. Residents in the Westminster part of Fitzrovia can also seek advice on planning applications by contacting the Fitzrovia Neighbourhood Association (email: fna@fitzrovia.org.uk).
General
Property Week reports that housing secretary Michael Gove yesterday told the Department for Levelling Up, Housing and Communities committee that he was unable to explain exactly how the government’s proposals to revive the Right to Buy scheme will be funded. In a meeting with the committee, Gove admitted that details about the funding of the extension of the Right to Buy scheme to housing associations had not been finalised yet, nor had the department conducted a full impact assessment of the extension. He also confirmed that the scheme would cap the number of tenants allowed to benefit from the extension. Last week, the prime minister committed to extend the Right to Buy scheme, which allows council tenants to buy their homes. Gove said he was committed to a like-for-like replacement of any council home sold to a tenant. But when questioned by committee chair Clive Betts on how the extension would be funded, Gove replied “from across government”.