A weekly round up of the latest planning and property news from the central London boroughs

City of London

Property Week reports that European investment company MiddleCap has struck a deal to bring forward the development of 1970s City office block Seal House, delivering 141,000 sq ft of mixed-use commercial space. The Fishmongers’ Company, a City of London livery company, has granted MiddleCap a new 155-year head lease, allowing it to proceed with proposals to redevelop Seal House. Located adjacent to London Bridge, Seal House was acquired by MiddleCap in 2019, its second UK property investment. The proposals, which have existing planning consent, will deliver a riverside mixed-use asset comprising office, retail and restaurant space alongside new public space. MiddleCap and PPF Real Estate are bringing forward Seal House as joint venture partners by co-investing on a 50/50 basis, with MiddleCap responsible for development management.

Property Week reports that there is “no will to change” the City of London’s success as a financial powerhouse following its exemption from permitted development rights, according to the region’s planning boss. Shravan Joshi, chair of the City of London Corporation’s planning and transportation committee, said operating as a finance and business centre was part of the City’s “essential remit”, although there had been a rise in planning applications from a greater range of sectors. A directive coming into force on 1 August will exempt the City from permitted development rights. As a result, plans to convert the Square Mile’s office buildings to housing will still require planning permission. Joshi said: “I think the secretary of state was absolutely right in his determination that we are a central business district in our ethos. That’s going to remain as it is.”He said a new local plan would be delivered “towards the end of next year” and added: “If we focus our efforts and money on delivering a good central business district, that is delivering the City Corporation’s essential remit.”Joshi said there had been an increase in the diversity of applications coming through the planning portal and into the City.

Property Week reports that in recent weeks and months, there has been an uptick in developers seeking permission to add further storeys to buildings, either for projects that have already won planning permission or for existing structures. The question is: what is driving the trend? In the past week alone, London planning authorities made decisions on two major projects whose backers were seeking approval for additional storeys. In the first, Transport for London (TfL) got the nod from the City of London Corporation for an additional office floor and roof terrace for its development on Cannon Street between Bank and Monument London Underground stations. As a result of the decision, the revised scheme will now have eight storeys, plus a basement, totalling 142,310 sq ft across the ground and seven upper floors, plus more than 7,600 sq ft of terrace space over three floors.

Property Week reports that plans have been uncovered for a 800,000 sq ft City of London skyscraper that would be one of the UK’s tallest buildings. Pre-application plans for a new 285m, 60-storey building at 55 Bishopsgate in the Square Mile were recently launched by Schroders Capital. Proposals for the £600m project say the skyscraper would be “one of the first all-electric tall buildings in the UK”, featuring 800,000 sq ft of workspace plus public accessible space on the bottom and top floors. The plans were designed by London-based architectural practice Arney Fender Katsalidis, and the building would occupy the western edge of the existing Eastern Cluster of tall buildings in the City of London. Shroders call 55 Bishopsgate a “dramatic addition to London’s skyline” and says it has taken a sustainability-first approach to the skyskraper’s design, featuring a reflecting structure.

Property Week reports that Avison Young has brought a 373,000 sq ft office asset and development opportunity in Kensington to market on behalf of the Department for Digital, Culture, Media and Sport. The government department is disposing of the grade II-listed Blythe House in West Kensington, Olympia, which is currently office space with potential for conversion into residential space. The building, formerly the headquarters of the Post Office Savings Bank, is currently used by the British Museum, the Science Museum and Victoria and Albert Museum for storage purposes. It comprises five storeys totalling 372,951 sq ft, as well as a further 55,000 sq ft of outbuilding space. Avison Young said Blythe House would be available for vacant possession in 2024. It has set a deadline for bids of 15 September.

Property Week reports that London-based real estate development and asset management firm W.RE has acquired Alexander House in Parsons Green, west London, in a redevelopment partnership with US private equity firm Taurus Investment Holdings.  The 22,240 sq ft building, which was acquired from Martin’s Properties with Puma Property Finance, is proposed to be redeveloped by the partnership to deliver approximately 45,000 sq ft of office floorspace across five storeys. The acquisition forms part of W.RE’s strategy to identify development opportunities in central London and deliver flexible, sustainable, grade-A office spaces in the capital. The partnership will focus on reducing carbon emissions by nearly 50% from the baseline scheme, while targeting BREEAM ‘Excellent’ and EPC ‘A’ ratings. Additionally, the five-storey building will also benefit from natural light, air-source heat pumps, PV panels and two roof terraces on the third and fourth floors.

Southwark

Property Week reports about the plans to redevelop Burgess Business Park to provide several hundred new homes alongside more modern office space in the area which have been green-lit by Southwark Council’s planning committee.  Property management firm Peachtree Services plans to revitalise the site and create a mixed-use development comprising 375 new homes, of which 35% will be affordable, along with around 32,300 sq ft of public space to be delivered alongside pedestrian and cycle routes. A new hub for local businesses will also provide 53,800 sq ft of flexible commercial floorspace, of which 20% will be affordable. The development, named Camberwell Union, has a GDV of circa £200m and will be fossil free and car free except for a small number of parking spaces for Blue Badge holders, while also creating 155 new jobs in the local area.

Wandsworth

Property Week reports that developer Thackeray Group has sold an office development in Putney, south-west London, to a private investor for just over £30m.The Assembly Rooms is the first new office development in Putney for more than a decade and comprises 26,624 sq ft of office and retail space over five floors. The development was put on the market by Thackeray Group in April after it was let to Gallaher and NatWest. Gallaher signed a 10-year lease for the 22,218 sq ft of office space, while NatWest signed a 15-year lease for a 4,406 sq ft bank on the ground floor and basement.

Westminster

Architects’ Journal reports that Foster + Partners has won permission for a reworked mixed-use scheme in Mayfair, central London. The practice had previously won consent in 2019 for a seven-storey luxury hotel on the site between Grafton Street, Bruton Lane and New Bond Street. That proposal would have linked to an existing 12-storey building and have had ground-floor shops and six re-provided homes. However, the scheme has now been overhauled after hotel operator Cheval Blanc pulled out of the plans following the pandemic. The new designs are ‘largely similar’, according to a planning report, but part of the site would be split into a separate building with shop units and flexible retail and office space. There are four buildings currently on the site: 8 Grafton Street and 9-10 Grafton Street are both 1960s office buildings which have been empty since 2013; 11-14 Grafton Street and 164 New Bond Street, an internally-linked 1970s building with seven shop units and offices above; and 163 New Bond Street, a 1770s building.

MyLondon reports that Guinness has been given permission to build a £73 million microbrewery in Covent Garden despite worries revellers will be able to see into residents’ homes. Plans for a six-floor microbrewery, complete with a 200-capacity yard were criticised by nearby residents for the amount of noise and disruption it will cause. Guinness hopes the new 50,000-square venue at Old Brewers’ Yard will include a two-storey roof terrace, a top-floor restaurant and a Guinness merchandise store. The drinks company also wants to convert a bin store into a bar area. But despite 32 objections from residents and the borough of Camden, the drinks giant was given permission to build the brewery as long as it met certain conditions.

Evening Standard reports that competition for West End offices is soaring despite the growth of remote working as employers snap up the best space to help hold on to valued staff. Demand for offices was up 62% in the second quarter of the year, according to new data from BNP Paribas Real Estate. There were 164 deals for 1.21 million sq ft with banking and finance, media and tech and professional services the most active sectors. The speed at which space is let has accelerated by 25%, while 52% of the take-up has been for Grade A space, the report said. The demand has started to drive prices with prime office rents in Mayfair and St James’s up 8% on last year. Average prime West End prime rents currently sit at £130 per sq ft.

General

Financial Times report that city centres are undergoing a moment of radical change. Physical stores have been destabilised by online retail, offices remain half-empty as employees choose to work from home. Public buildings, the libraries, police stations, swimming baths, banks, town halls, churches and community centres, are increasingly being turned into hotels or flats as councils respond to government austerity. This revived, engaged city does not require new buildings but it does demand serious thought into how the city is used and for whom it is being designed. New offices are being built in exactly the same way as they were in the 1960s. What’s necessary is an appreciation of the complexity and diversity of urban space. Most of what is needed is already there. It just asks employers to understand how it can be used and what they can do for the city.

Financial Times  report that the pandemic put industrial sheds at centre stage of commercial real estate, but they are now suffering from rate rises and cooling demand. In the early months of 2020, drones flew around vast empty warehouses in the UK to provide virtual tours to investors. Cash poured into sheds all over Europe — much of it diverted away from areas of the property sector that were proving vulnerable to Covid lockdowns, such as offices and shops. A boom in ecommerce during the pandemic only increased demand for warehouse space. As this flood of money washed into a relatively small corner of the real estate market “prices went up”, de Minckwitz says, “and they went up so quickly . . . the second half of 2021 was astonishing. Everyone was pushed to the limit.”

Property Week reports that London mayor Sadiq Khan has backed a half-million-pound marketing campaign that aims to attract foreign investment into housing, regeneration and green infrastructure schemes across the capital. The campaign, called Opportunity London is financed by the mayor as well as London Councils, a body that represents London’s 32 boroughs plus the City of London. Further funding is being sought from the private sector.