Well it’s not summer just yet but things certainly feel a little discontented. Eye-watering energy bills (and that’s pre-Russian sanctions) and eyebrow-raising fare hikes will now meet grimace-inducing council tax rises against a background of industrial action and war-fuelled anxiety.
On the economic front, the whys and wherefores may make sense but the bite will still hurt, especially for those Londoners who struggling to make ends meet in an already expensive city.
In this context, the news of AustralianSuper’s investment into Canada Water is especially good news and a real vote of confidence in the capital. More below.
While we contend with all of *gestures wildly* this, it is clear that we need every morsel of talent available to help us through a challenging time and into recovery. Which is why LCA yesterday, on International Women’s Day, announced a new partnership with the Central District Alliance BID to, over the course of a year, examine how to create a truly inclusive economy. Read more in Our Week below.
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The announcement of plans for the Ultra Low Emission Zone (ULEZ) to cover the entirety of Greater London from 2023 has split opinion. Headlines in right leaning titles cite ‘fury’ against the Mayor’s ‘escalat[ing] war’ on motorists and yet another ‘car tax blow’. But really there is very little evidence of a backlash so far – with concerns focused more on the logistics, like how the Mayor will support residents and businesses dependent on older cars through the transition and invest in the electric revolution. The plans though are not a fait accompli. For now, all the Mayor has said is that he has ‘asked TfL to consult’ on the expansion beyond the North and South Circular Roads (the A205 and A406) to the edge of the Greater London Boundary. He has also endorsed, in principle, a ‘smart’ per mile road user charging system as the optimal and ‘fairest’ solution to replace the ULEZ and Congestion Charge in the long-term. Additionally, he has confirmed that he is ‘ruling out’ a Clean Air Charge and the especially unpopular Greater London Boundary Charge.
Why now? In the first instance, Sadiq Khan clearly wants to create a legacy for himself as a ‘green’ Mayor but in this case he was also under pressure to do something along these lines, both from the terms attached to TfL’s latest Government support package, as well as from environmental campaigners and allies within his own party. In relation to the last, Newham recently became the fourth Labour-controlled council to formally call for the cancellation of the GLA-backed Silvertown Tunnel (the others being Lewisham, Hackney and Southwark), while a protest by medics opposed the project also generated headlines. They argue that the car-centred tunnel will increase congestion and pollution. The Mayor has suggested critics live in “never never land”.
INDUSTRIAL ACTION, EVERYWHERE?
According to one tally, the Tube strike on 1 March was the 51st to take place during Khan’s tenure as Mayor. That would mean that there have now been more strikes during this time than there were under Ken Livingstone and Boris Johnson’s mayoralties combined – despite Sadiq’s 2016 pledge to deliver a ‘zero’ strike mayoralty. That said, striking RMT union members cite changes to TfL pensions and job losses as the reason for last week’s walkouts… which are actually conditions attached by Government to continued funding for TfL. The Mayor argues that by striking over these conditions, the RMT was only ‘letting the Government off the hook’ – but evidently, many are still blaming him. Separately, bus drivers employed by Arriva have said that they will strike on 21 March and 28 March in response to what they say is a ‘pathetic’ pay offer by their employer. Elsewhere, staff at 68 universities across the UK, including in London, started striking in February. The University and College Union has now opened new ballots on industrial action over issues around pay, pensions and working conditions, while Unite is also balloting workers at five London universities over pay.
LIVING COSTS UP, EVERYWHERE?
All of this industrial action over pay and pensions is of course set in the context of the soaring cost of living. Even before the pandemic, about four in ten Londoners struggled to raise an income needed for a minimum socially acceptable standard of living and polling by London Councils last November confirmed that this remained Londoners’ number one concern - and that was before rising inflation levels and skyrocketing energy costs really hit. Then, last week both TfL and rail companies hiked fares (by 4.8% and 3.8% respectively). The ban on importing Russian oil announced this morning is sure to also impact drivers as well as (presumably) households’ already significantly inflated energy bills. Amid this squeeze on household budgets, this month local authorities will set and publish Council Tax rates for the year ahead. The Evening Standard reports that every single London borough except Hammersmith & Fulham and Wandsworth will be increasing their core Council Tax rate. The majority of these will do so by the full 2.99% permitted before triggering a referendum (note that this tally does not factor in the social care precept, which is levied on residents through the same tax bills).
OLIGARCHS RUNNING, EVERYWHERE?
Even, or perhaps particularly, in more affluent parts of town, the economic sanctions levelled against the Kremlin and its associates are starting to be felt. Clearly alarmed by reports that Whitehall is ‘exploring options’ for seizing their property, many Russian ‘oligarchs’ are liquidating holdings as fast as they can. Roman Abramovich’s efforts to sell Chelsea F.C. alone are emerging as a saga in their own right. Of course, as per many commentators and the Opposition, sanctions are riddled with loopholes, but London-based organisations are also feverishly cutting ties with Russian investors, clients, suppliers and partners. Local authority pension funds are ‘scrambling to divest millions of pounds worth of assets linked to Russia’, while individual councils are scouring supplier lists for sanctioned firms. The property sector is also beginning to take action, with British Land revealing intentions to evict a Gazprom subsidiary from its 20 Triton Street offices, Legal & General Investment Management committing to further divesting from Russian interests, and major London-based property advisors cutting ties with Russian partners. Meanwhile, Battersea Power Station, Shaftesbury, and Quintain are among companies to publicly express solidarity with Ukraine.
Some, particularly in the luxury property sector, fret that sanctions on Russians may deter investors from elsewhere. Then again, recent research by CBRE and Knight Frank suggests London remains a pretty solid prospect and major deals (see below) confirm that the city has by no means lost its lustre.
British Land’s 53 acre Canada Water development, a JV with the London Borough of Southwark and one of the capital’s most important regeneration projects, is now a three way partnership after the developer sold 50% of their interest to AustralianSuper yesterday for £290m. British Land achieved full planning permission for the 5m sq ft Canada Water scheme in 2020, a consent LCA advised on. It is highly flexible, enabling British Land to deliver between 2,000 and 4,000 new homes alongside a mix of commercial, retail and community space. The first three buildings, covering 582,000 sq ft including 265 new homes, offices and new leisure facilities for Southwark, are already under construction. British Land and AusSuper have committed to £201m of initial funding to the JV for the purposes of completing Phase 1 of the Masterplan and to progressing subsequent phases of the development. AusSuper is Australia’s biggest profit-to-member pension fund with over 2.6 million members and more than £140bn in member assets under management and is probably best known in the UK for being a long term investor in the 67 acre King’s Cross Central Limited Partnership.
Admiral Sir Philip Jones, former First Sea Lord and chief of naval staff, has been appointed to the Board of the Port of London Authority as a non-executive director, with a particular focus on river safety.
Mike Rowlands, previously of BNP Paribas and Strutt and Parker, has been appointed by CBRE as an executive director in its national investment team.
With just under two months to go until the local elections, candidate selections are still underway across London:
- In Haringey, Labour recently announced its candidates for South Tottenham and Bruce Castle wards.
- Also in Haringey, the current Deputy Leader of the Council Cllr Mike Hakata has been deselected alongside his fellow ward councillor Cllr Julie Davies. The two have been replaced by candidates reportedly backed by Momentum.
- The Labour candidates for Hounslow’s Feltham West and Hounslow South wards have been selected.
- Lewisham Labour appears to have completed its candidate selections over the weekend.
- The Labour candidates for the South Bermondsey and St Giles wards in Southwark have been announced.
LONDON PLANNING ROUNDUP
- The Department for Levelling Up, Housing and Communities has confirmed it will not block a move by the City of London Corporation to extend its Article 4 exemption from national office-to-residential permitted development rights. The City Corporation says this will enable it to ‘protect existing office floorspace against a change of use to housing where that would cause harm to the primary business function of the City.’
Westminster Council has refused Unite Students' Baltic Wharf student housing scheme in Paddington, on the site of a Travis Perkins builders’ merchant. While the scheme would have offered 768 student rooms (35% at affordable rates), a new yard for Travis Perkins and other benefits, the scheme was recommended for refusal by officers, subject to referal to the mayor, and rejected by a unanimous vote of the Planning (Major Applications) Sub Committee, mainly due to its height and impact on neighbouring residents.
- Greenwich’s Planning Board has approved plans by Hyde for over 1,200 homes in Charlton (40% affordable), despite concerns from local residents about the density and scale of the development as well as the site’s proximity to an asphalt plant.
- Barnet Council has rejected plans by Fairview New Homes for 539 homes (35% affordable by habitable room), retail, commercial and community space despite officer recommendation for approval. The Council had previously refused plans for 652 homes on the site.
- Plans to increase Barnet’s Community Infrastructure Levy (CIL) rate by more than double for residential development have been approved by an examiner. The local authority’s CIL rates had gone unchanged since 2013.
- Hackney Council has granted permission for its own proposal for 387 homes as part of the wider regeneration of the Britannia Leisure Centre site. The masterplan for the scheme, including new leisure facilities, a school and housing, was consented in 2018. All of the 387 homes will be for sale to fund the rest of the development.
ARCHITECTS TAKE NOTE
The Royal Institute of British Architects (RIBA) is competition central these days. RIBA has announced the 68 projects shortlisted for the London Awards, part of the wider Regional Awards programme. The selected projects were assessed on their environmental and social consciousness and will be assessed by an all-star jury of architects, with the winners announced later in the spring. RIBA is meanwhile undergoing its own design changes, with its HQ in Portland Place set to be refurbished and modernised to ensure that it is ‘fully accessible, fit for the future and an exemplar of sustainable retrofit’. Seven architectural practices have been shortlisted with work expected to start in late 2023 at the earliest. The shortlist comprises David Kohn Architects, Hall McKnight, Roz Barr Architects, Hugh Broughton Architects, plus two team bids, one by Donald Insall Associates, Freehaus and IDK, and another by Feix & Merlin Architects with Haptic Architects and Heritage Architecture.
Yesterday on International Women’s Day 2022, LCA announced a new partnership with the Central District Alliance (CDA). UN_biased, is a year-long research and engagement project which will explore what it takes to create a truly inclusive economy. It will combine the CDA’s footprint, the scale and diversity of its offer, with LCA’s formidable network and reach across the built environment sector to create a live case study. Through research, events and engagement work it will seek to understand and address the barriers to equality, considering themes like access to jobs and skills, flexible working practices, inclusive and accessible spaces and physical and psychological safety. Read more here.
LCA is also the communications partner for Mentoring Circle and were proud to get a spotlight on them in Property Week yesterday as the charity celebrated its first year anniversary. The piece features founder, Stanhope’s Vanessa Murray, and champions female talent in real estate through free, cross-sector mentoring. It’s been such a pleasure working with the amazing women involved and to see the programme flourish!
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