DELIVER, DELIVER, DELIVER?
24 hours into a Truss premiership, what can we glean about her approach to the capital and London’s future in general?
On the one hand, at least we have a short/medium term settlement for Transport for London (to March 2024), although no one appears that happy with it. On the other hand, pressure on the Mayor of London continues to grow over policing the capital. The new PM clearly blames him for all this and has made no secret of the fact she doesn’t like him and wants him out in May 2024.
But… the new PM has expressed some warm words about London’s importance to the UK economy and if she believes we can grow our way out of the cost of living crisis, then the capital’s success is critical to this. Yet, how this relates to a ministerial decision shortly before the election, to call-in two more London planning applications that were supported by both the relevant local authority and the Mayor, is hard to fathom.
One thing appears broadly certain, the new PM intends to call the general election in 2024 (she can go to January 2025). If so, it will be interesting to see if this is called on the same day as the GLA elections, or not and what effect that might have on turn out and the possibility of the Tories winning back the capital – which is a long shot even though we have moved back to a straight first past the post system.
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LIZ IT IS
Here we are then. It only took months of scandal, several abortive votes of confidence by both 1922 Committee and the Commons, a Cabinet coup, a dozen hustings, five MPs' ballots, one members’ vote and two return flights to Scotland for the Conservative Party to give us our third Prime Minister in five years. So, what does it mean from London’s perspective? In the first instance, Liz Truss has appointed a new Cabinet, including Kwasi Kwarteng in the key role of Chancellor of the Exchequer, Simon Clarke as Levelling Up Secretary, and Anne-Marie Trevelyan as Transport Secretary. Only one minister attending Cabinet, Chief Secretary to the Treasury Chris Philp, is elected in a London constituency (Croydon South), though Truss herself was once a councillor in Greenwich and other Cabinet members have previously served in London town halls, City Hall and the London Assembly. The new PM tried to burnish her pro-London credentials during her campaign, but has also taken a swipe or two at the Mayor (who has responded in kind) which doesn’t bode well for already-toxic relations between Whitehall and City Hall, more on which below. On policy, little of what Truss has said seems to address challenges specifically faced by the capital. Meanwhile, Truss’ real intentions for the built environment remain a bit of an enigma – with a contradictory record of statements on the Green Belt, not to mention pledges to ‘cut red tape’ jarring against promises to ‘put power back in local councillors' hands.’
The biggest, most immediate test for the new Government is how its cost of living package addresses regionally-specific challenges. Whilst the capital remains a huge generator of wealth and prosperity, Londoners are experiencing the highest inflationary pressures in the country. This is not an abstract, future challenge – recent YouGov polling for the GLA found that 20% of Londoners went without food or other essentials in the past six months. Underlying inflation is 1.5% higher in the capital than the rest of the country, according to City Hall, with rents (increasing by 15.8% annually according to one estimate) a particular concern, especially for people on low incomes. Homelessness charities Crisis and Shelter have been ringing the alarm for weeks now and London Councils has warned that rising rents and local government funding pressures are creating a perfect storm (though they have welcomed the publication of a new Government Rough Sleeping Strategy). Unless Whitehall steps up to the plate with measures tailored to Londoners’ needs (or enables regional and local government to shape these meaningfully), Henry Mayhew’s observations of the ‘London Poor’ in the 1840s may be closer to the contemporary reality of the metropolis than we would like to imagine – and reactions to Truss’ election by representatives of Centre for London, the Trust for London and London Councils, as well as the Mayor, all point to tackling the cost of living as priority No 1 for Londoners.
LONDON TRANSPORT REVPRIEVE?
After weeks of negotiations, Transport for London (TfL) and the Government have finally agreed a funding deal. Following an emergency meeting of the TfL Board on 30 August, the news broke that TfL had accepted the fourth iteration of a deal first offered by Government on 22 July. The new settlement, outlined in a letter from now-departed Transport Secretary Grant Shapps, lasts until 31 March 2024 or until the point TfL reaches financial sustainability. It is comprised of £1.1bn of actual additional grant funding – with a £3.6bn figure repeatedly referenced (see also here) by Shapps only corresponding to the estimated value of capital projects that the funding will ‘unlock’. The Mayor of London, unsurprisingly, has called it ‘far from ideal’. As part of the agreement, TfL is expected to continue to deliver major projects which are already underway, progress projects which guarantee safety, as well as those which ‘contribute’ to the aim of achieving financial sustainability and those which fall under TfL’s ‘Active Travel’ programme – but the deal includes no funding for any new major projects (e.g. the likes of Crossrail 2 and the Bakerloo Line Extension, neither of which is mentioned). Also included in the package from Government is (partial and unspecified) funding for the repair of Hammersmith Bridge. There are of course conditions attached which will have wide-ranging implications. One is the requirement that TfL continue work on the introduction of driverless trains to the network along with pension reform, both of which have led the RMT to say that there will be more industrial action on the Tube as a result.
The Mayor of London’s stewardship of London’s police service has come under sustained fire in recent weeks, much of which has been fuelled by the findings of a review of the process that led to Dame Cressida Dick’s resignation as Met Police Commissioner. Former Chief Inspector of Constabulary Sir Tom Winsor, who was commissioned to carry out the review by former Home Secretary Priti Patel, found Dick was ‘intimidated’ by threats of public criticism of her leadership. Khan has ferociously denied the accusations, branding the review ‘clearly biased’ and one that ‘ignores the facts’. The Home Office has stood by Sir Tom, insisting that he ‘upholds the highest standards of integrity’ when it comes to reporting the facts. Elsewhere, the Met’s efforts to tackle violent crime and policing of public events and protests have also come under intense scrutiny. London faced yet another weekend of violence after seven stabbings and 209 arrests, whilst instances of sexual assault marred the return of the Notting Hill Carnival (though more arrests occurred at the 2019 carnival and proportionately at the 2020 Euros final). Looking ahead, the expected Extinction Rebellion protests next week arguably pose the next big challenge for the Met (and by extension, the Mayor).
LAST MIN CALL IN(S)
Just days before he was ousted from his role as Housing Secretary, Greg Clark used his powers to call-in two planning applications in London. Clark called-in Mitsubishi Estate and CO-RE’s application for the redevelopment of the ITV studios on the South Bank. The plans, which would see the existing buildings demolished and the delivery of a new office-led development in towers of 14 and 25 storeys, were approved by Lambeth Council before being waved through by the Mayor. Despite this endorsement at local and regional level, the proposals have faced significant opposition from campaigners, including local residents and some politicians, who have cited concerns about the development’s height and its impact on neighbouring housing as well as the South Bank skyline. Clark separately called-in Montreaux’s plans for the redevelopment of a B&Q site in Barnet, to deliver 1,049 homes, 35% of which would be affordable, in blocks of up to 18 storeys. Despite local opposition, Barnet Council granted planning permission for the scheme last year. After the Mayor said that he would not intervene, former Housing Secretary Michael Gove issued an Article 31 holding direction on the application, paving the way for Clark's call-in. There are two other London applications called-in by the Secretary of State that are yet to be determined, the Oxford Street M&S redevelopment (whose inquiry is set for October) and the proposals for the redevelopment of the Tesco and Homebase sites on Syon Lane in Brentford.
...AND OTHER PLANNING NEWS
- A brace of reports to be considered by Wandsworth Council’s Housing Committee next week may herald a significant shift in the now Labour-run Council’s approach to affordable housing. The long list of proposed policies, to be formally approved by the Council Executive later this month, will affect the Council’s own housing stock, estate regeneration and housebuilding programmes, as well as its acquisitions programme, but may also influence its approach to securing affordable housing from private developers.
- Meanwhile, Greystar’s proposals for a 24-storey, 547-home shared living scheme in Battersea have been rejected by Wandsworth councillors against officers’ recommendation, because the scheme had no affordable housing.
- Citystyle Fairview and One Housing have had their Victoria Quarter proposals appeal, for 539 homes built in blocks up to seven storeys high at the former British Gas site in Albert Road, Barnet, rejected by the planning inspector, mostly citing the scheme’s design. The scheme was refused by Barnet Council in 2022, against a recommendation to approve, on the grounds of massing and other design grounds, as well as transport considerations.
- A planning inspector has upheld Westminster’s refusal of Leconfield House Ltd’s proposals to convert the Leconfield House site on Curzon Street into a 70-room hotel.
- Whilst, Palmers Green Investments has won permission to turn a former office block in Southgate into a 107-room hotel, after a planning inspector overturned Enfield Council’s refusal.
- South Street Asset Management has lodged an appeal against Tower Hamlet’s refusal of proposals to build a 14-storey office building in Whitechapel.
- The Planning Court has rejected Spitalfields Historic Buildings Trust’s application to subject Tower Hamlets Council’s approval of plans to redevelop Truman Brewery to a judicial review.
- Haringey Council has approved Jigsaw PMG’s proposals to build 451 student flats in a 24-storey building in Tottenham Hale.
- Newham Council-owned Populo Living has submitted the outline planning application for the proposed £1bn regeneration of the Carpenters Estate. 73% of the estate’s existing residents voted to approve the plans to build 2,152 homes on the site – more than 50% of the new homes will be allocated at social rent rates.
- Bourne Capital has submitted proposals to Lambeth Council for the development of 375,000 sq ft of grade A office space in a 20-storey building on Waterloo and Cornwall Road.
- Developer Tishman Speyer’s plans to partially demolish the existing postmodern four, five and six-storey office block above Angel underground station have been approved by Islington’s planning committee despite objections from Save Britain’s Heritage and the Twentieth Century Society.
BACK TO SCHOOL/WORK
September is a busy month for events celebrating the best of the capital. The 2022 Open House London Festival will showcase the architecture and neighbourhoods that make London one of the best cities in the world, starting tomorrow. Meanwhile the annual Totally Thames festival will celebrate the River with events and activities all month long. Elsewhere, the London Design Festival celebrates its 20th anniversary with eight days of events, exhibitions and installations, while Regent’s Park will be transformed into a massive outdoor gallery for Frieze Sculpture 2022. For those in the planning and development world, this year’s London Real Estate Forum (LREF) will take place at the Barbican Centre on 28 September and on location on 29 September – as always, we will be there! The LCA team will also be on the party conference circuit alongside a number of key London organisations including NLA/Opportunity London and London Councils and we hope to see you there!
London’s property sector has seen some significant deals take shape over the past few weeks:
- Greystar Real Estate Partners has acquired the Biscuit Factory scheme in Bermondsey from Grosvenor. The developer was granted planning permission in 2020 for the delivery of 1,548 homes and flexible office space, on the former site of the Peek Freans biscuit factory. Details of the deal have not been made public.
- Vistry Group has bought Countryside Partnerships in a £1.25bn deal. Greg Fitzgerald, Chief Executive of Vistry, will lead the combined group, which will continue to deliver affordable homes with local authorities and housing associations under the Countryside name.
- The King’s Cross Central Limited Partnership has secured a £1bn refinancing deal. The new, single loan facility is secured by a number of investment assets at the King’s Cross Estate. See Our Week below for more.
GOVERNMENT PROPERTY STRATEGY
The Government has unveiled a new Property Strategy for 2022-2030, which is centred around ‘levelling up’ commitments, efficiencies and savings. Critically, the strategy includes proposals to sell £1.5bn of property assets over the next three years, consolidating staff into fewer buildings as part of a new network of Government ‘hubs’ and accelerating the Places for Growth programme, which plans to move 22,000 civil service roles out of London by 2030. The strategy also seeks to make a further £500m of savings through reduced operating costs and cutting spend on leases. Business Secretary Jacob Rees-Mogg (who was Minister for Government Efficiency at the time the strategy was published) hopes that relocating civil servants will promote levelling up and consolidating departments will achieve savings for the taxpayer. This is not long after Rees-Mogg repeatedly attempted to force civil servants back into their offices, including by leaving little notes on his own staff’s desks, with little success. Indicatively, just half of the Home Office’s desks were occupied in the last week of June. This liquidation of Government-owned assets is a mixed blessing for London, releasing buildings for repurposing or redevelopment, whilst also (potentially) confirming fears that demand for some types of office space may be waning.
DLUHC 'TIL YOU DROP
Apart from the call-ins referenced above, the Department for Levelling Up, Housing and Communities (DLUHC) has been remarkably busy for a summer recess period under a ‘caretaker’ Secretary of State. Since our last edition, the Department has:
Of course, most of the above mark only the beginning (or at best the mid-point) of tackling a huge in-tray of challenges inherited by incoming Levelling Up Secretary Simon Clarke, who will also have to deal with local authorities in financial distress from Spelthorne to Bradford, not to mention shepherding the Levelling Up and Regeneration Bill through Parliament.
With all eyes firmly fixed on the announcement of the next Prime Minister, we worked with our clients VU.CITY, Hydrock and Broadway Malyan to place reactive comments across the trade media. Broadway Malyan’s Danny Crump featured heavily throughout the day, with comments in the Architects’ Journal, Property Week, Place North West – and a follow up op-ed in Property Week. CEO of VU.CITY, Jamie Holmes’ call for a refocusing of government attention to Levelling Up was highlighted in EG, as well as Infrastructure Intelligence’s roundup of industry reaction to Truss’ victory. Bringing a Welsh perspective to the announcement of the new government, Hydrock’s Matthew Ace found a home in the New Civil Engineer and Construction News, outlining the importance of Truss leading the way for all four UK nations. With Cabinet meeting for the first time today, you can expect to see more coverage of our clients over the next week. Away from politics, we supported our long-standing client King’s Cross as they unveiled a blockbuster £1bn refinancing deal, securing coverage in EG, React, Property Week, Costar, and Prime Resi.
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