“I am shamelessly hi-jacking the prime real estate of this LDN editorial to announce the launch of a brand new LCA Insight Series. Brought you to by the same team who bring you LDN each week.
While LDN provides you with a pithy, broad rundown of London news, this new series will take a more in-depth and considered look at single issues affecting our clients and the wider sector.
This first edition, titled ‘A Red Dawn?’, looks in detail at what a potential Keir Starmer-led Labour Government could mean for business and the built environment sector. This is of course highly topical as Starmer and team have just started to roll out the party’s five ‘national missions’ – moving the campaign more fully into pre-election mode.
You can access the report here and learn all about the party’s current policy platform, Keir’s top team, the media and social media influencers who will make or break this moment for Labour, an expert view from a party insider and of course the insight and commentary you expect from all at LCA.
We hope you find it an interesting and valuable read and a great complement to LDN, which this week (as always) is packed full of important sector news. Let us know what you think!”
Jenna Goldberg, LCA Partner & Managing Director, Insight and LDN Editor
We hope you enjoy this edition and if you don't already, do follow us on Twitter, Instagram and Linkedin. You can also visit our website for more information on LCA’s team, services, and clients.
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The Labour Party is beginning to shift into pre-election mode in earnest. Last week, Labour announced its overarching Five missions for a Better Britain – broad ambitions for economic growth, clean energy, reforming the NHS, policing and crime, and ‘breaking down the barriers to opportunity at every stage.’ These came with some policy proposals, but most detail was understandably reserved for subsequent announcements. The first of these came on Monday. In a speech to business leaders and economists in the City, Starmer presented his ‘plan for growth.’ Whilst overshadowed by the Northern Ireland protocol deal, Labour did notably win a few high-profile endorsements from business. We were especially intrigued by widely-publicised commitments to planning reform though there is not much detail on this – yet. In his speech, Starmer obliquely suggested that the current system favours ‘the already wealthy’ and is failing to deliver ‘new houses, wind farms, and laboratories.’ In a linked op-ed, Shadow Chancellor Rachel Reeves referred only to ‘updating our planning system to remove barriers to investment in new industries.’ Reeves’ comment echoed language in Labour’s relevant briefing, which elsewhere also mentions ‘helping first-time buyers onto the housing ladder and building more affordable homes by reforming planning rules and arcane compulsory purchase rules, with new protections for renters.’ The briefing later adds an ominous reference to ‘the vested interests’ that need to be ‘overcome’ to achieve planning reform…
However, Labour has actually given us more clues about its intentions over the past few months and last week, LCA issued an exclusive client briefing on a potential Labour Government – a detailed look at the road to an election victory for Keir Starmer and what that might mean for business and the built environment. We are very pleased to now bring this in depth report to LDN readers too so that you can explore the current policy picture plus key people and influences around a Labour Party that is now very much in the ascendancy. Access the full report here and of course let us know what you think!
A BUILDING MAYOR?
Whilst the national Labour Party’s approach to the built environment is still under construction, a certain Labour Mayor is onto the final fit. In mid-February, the Mayor recorded a remarkable uptick in the construction of new affordable homes funded by City Hall, with 3,698 started from September to December 2022 and a total of 6,877 total starts for the financial year to date. This is, City Hall informs us, ‘a more than 50% increase on the total number of homes built by this point last year when Sadiq went on to achieve the highest number of starts since City Hall records began.’ See the detailed figures here. Subsequently, the Mayor launched the new Architecture and Urbanism (A+U) Framework, a ‘diverse, pre-approved panel of built environment consultants.’ Open to Greater London Authority Group bodies, councils and housing associations, the framework is intended to make procurement for public sector projects quicker and easier. And on the first anniversary of the invasion of Ukraine, the Mayor announced funding for up to 600 new homes in London for Ukrainians and Afghans refugees. Whether you agree or disagree with these and other policies implemented by Sadiq Khan, the national Labour Party will surely be looking to his work for examples of how ‘Labour in power’ can deliver growth.
LONDON PLANNING ROUNDUP
- Last week, LCA client the Earls Court Development Company (ECDC) unveiled their draft masterplan for the transformation of the 40 acre, largely derelict site of the former Earls Court exhibition centres. Shaped by over two years of community engagement, the new plans will see Earls Court reborn as an £8 billion green neighbourhood with a new park– larger than Trafalgar Square! - at its heart. See below for more on how LCA supported this milestone for Central London’s largest development opportunity in the Our Week section.
- Greenwich Council has approved Hyde’s proposals to demolish the Brookhill Close estate in Woolwich and build 257 new homes across six blocks of between three and seven storeys. The housing offered is 25% for rent (split half London Affordable Rent and half social rent), 25% shared ownership and 50% for private sale. The plans were previously approved in a residents’ ballot.
- 91% of eligible residents from Ebury Bridge voted (on a turnout of 67%) in favour of Westminster City Council’s plans to regenerate the estate and deliver just over 780 new homes (over 50% affordable).
- Countryside has claimed that it is not viable for it to meet the council’s affordable housing target on the Marlowe Road Estate project in Waltham Forest, where it aims to replace 298 low-rise flats with around 448 new homes. The developer is seeking to reduce the proportion of affordable homes on the scheme, as approved in 2016, from 56% to 45%.
- Southwark Council has approved Native Land’s proposals for a 110,000 sq. ft office at its Bankside Yards development. The office will be the eighth building on the site.
- Meanwhile, 74 Long Lane Ltd have secured Southwark Council’s permission to redevelop the former Selected Rug Co building on Long Lane into an 11-storey office block.
- Wandsworth Council has approved Avanton’s proposals to redevelop the industrial complex Culvert Court in Battersea, which will deliver ‘a modern complex’ of warehouses with an estimated completed GDV of £30m.
LONDON LEADS NET ZERO
London’s built environment sector is leading the way when it comes to efforts to decarbonise, but a number of knotty challenges remain. Last week, Canary Wharf Group joined forces with British Land and Barratt Developments for the Ambition to Action summit, which aimed to encourage the sector’s wider construction supply chain to decarbonise. There are however a number of hurdles the sector will need to overcome. Policy is one, with a report by the British Property Federation and JLL having found that 9 in 10 industry leaders do not think that existing Government policy will help the sector transition to net zero by 2050. The sheer scale of the challenge is another, with BNP Paribas Real Estate finding that 8% of commercial buildings in inner London will be ‘unlettable’ from April, a figure that could increase to 50% from 2027, under upcoming changes to the Minimum Energy Efficiency Standards. From April, it will be illegal for offices with an F or G rating to be let out. The minimum standard will then rise to a C rating by 2027 and B by 2030.
- Smith Mordak, currently Director of Sustainability and Physics at Buro Happold, has been appointed as the new Chief Executive of the UK Green Building Council (UKGBC).
- Pippa Wicks, the Executive Director of John Lewis’ department store chain, has stepped down. John Lewis retail director Naomi Simcock has succeeded her on an interim basis.
- Workspace chair Stephen Hubbard will be succeeded by current non-executive director Duncan Owen in July.
- Howard de Walden has recruited Simon Tranter – formerly of Wilmott Dixon – as its head of sustainability.
BUSINESS CREDENTIALS BATTERED?
London has received mixed marks as an investment destination in a number of recent reports and rankings. We’ve taken a closer look. Schroders’ Global Cities Index for 2022 – which ranks cities across Economic, Environmental, Innovation and Transport criteria – saw London drop from first to third place. While third place is still a pretty sweet spot, above the likes of New York, Singapore, Berlin and Paris, London’s relative fall is, per Schroders and relevant press coverage, due in part to a new venture capital score added to the Index, boosting established innovation hubs San Francisco and Boston to first and second place. It is rather more concerning that the separate Savills Tech Cities 2023 report ranks London fifth globally, down from third place in its 2019 report. The city’s performance also varies in other sector-specific reports. London is ranked high as a ‘crypto hub’ (a controversial one, we know), but woefully low for broadband speeds. In brief, London cannot rest on its laurels. As per a recent blog by London Property Alliance’s Chief Economist Alexander Jan, ‘London, the grandmother of world cities, is going to have to start watching her back a little bit more carefully from now on.’
Housing supply, another key ingredient for a city’s success, may be headed for a bottleneck – and not just in the capital. The Home Builders Federation (HBF) has warned that housebuilding in England could fall to its ‘lowest level since the second world war,’ predicting that it could fall below 120,000 new homes annually over the coming years, or less than half of the Government’s long-standing annual target. The HBF attributes this tailing off of supply to planning policy changes and ‘over-strict enforcement of environmental regulations’. This is not just developers griping about ‘red tape.’ Planning’s Housing Supply Index update for February indicates that as of last month, 38% of planning authorities in England were unable to demonstrate at least a five year pipeline of deliverable housing sites - a slight improvement on the last update in June, when 39% were unable to do so, but still concerning. Separately, in a letter to the Levelling Up Secretary, the British Property Federation, National Housing Federation, Shelter, Crisis and the Church of England - an (un)holy alliance if there ever was one – have warned that the Infrastructure Levy enshrined in the Levelling Up & Regeneration Bill (LURB) will only further reduce the delivery of affordable housing and homes for social rent. Barking & Dagenham Council Leader Darren Rodwell has meanwhile said – in his capacity as London Councils’ lead on regeneration, housing and planning – that the LURB is ‘flawed’ and will ‘make levelling up and regenerating our communities harder, rather than easier.’
The pandemic, hybrid working, online shopping and other factors continue to impact commercial property. It has been reported that HSBC is looking for a new, smaller London office as it embraces working from home. The bank’s current London headquarters are in 45 storey Canary Wharf tower, but it is reportedly seeking to cut its office space by 40%. Law firm Clifford Chance also recently left Canary Wharf and relocated to a smaller office in the City. Meanwhile, Cineworld is reportedly set to close 130 of its cinemas in the UK and Ireland, including 25 branches in London. Cineworld entered into administration in the US in 2022 and has so far struggled to secure a buyer. There is however some more positive news, with Avison Young reporting that professional service firms have acquired a record amount of office space in central London and data from Savills indicating a commercial real estate investment boom for the City in January. Meanwhile, asset manager Pimco has signed a deal with Derwent London to let additional space at a new office building on Baker Street.
PROFESSIONALISE OR PERISH?
The social housing sector is facing yet more pressure to improve its performance. Levelling Up Secretary Michael Gove has tabled further amendments to the Social Housing (Regulation) Bill, this time requiring social housing managers to gain formal professional qualifications ‘under new rules to protect residents and raise standards in the sector.’ An estimated ‘25,000 managers across the sector’ will be required to have a housing management qualification, regulated by Ofqual, ‘equivalent to a Level 4 or 5 Certificate or Diploma in Housing, or a foundation degree from the Chartered Institute of Housing.’ As ever Inside Housing offers a good explainer of this development, which has naturally been welcomed by the CIH, though the National Housing Federation (NHF) seems to still be mulling its response. On which point, the NHF notably welcomed the HBF’s intervention on housing supply, as well as joining the BPF and others in warning that the Infrastructure Levy could backfire. The NHF’s Chief Executive Kate Henderson had her first meeting with new Housing Minister Rachel Maclean last week, describing it as ‘positive.’
LONDON STADIA LATEST
Chelsea FC’s plans to redevelop Stamford Bridge are ticking along behind the scenes. Over the weekend, The Times reported that members of the club’s stadium redevelopment taskforce viewed Everton FC’s stadium development site to better understand how contractors Laing O’Rourke were able to overcome difficult construction circumstances. The club has not decided whether it prefers the option of rebuilding Stamford Bridge stand by stand or demolishing it and starting over – and the site clearly presents a few obstacles to both options, particularly height restrictions and the neighbouring train lines and cemetery. The Times understands that the club are hoping to pick an option by the summer and does not anticipate completion before 2030.
Meanwhile, the London Legacy Development Corporation has announced plans to cover the London Stadium’s roof with solar panels. The plans, which have the support of the Mayor, are expected to cost about £4m over two years, but the corporation believes the panels will pay for themselves after just five years by generating roughly three million kilowatts of power each year. While subject to planning permission, the corporation says work to install the panels could begin in mid-2023, with power starting to be generated by April 2024.
BRINGING THE WONDER BACK
Building on two years of community engagement, last week we launched an immersive and innovative consultation space for the Earls Court Development Company (ECDC) to showcase their new masterplan for the 40-acre site of the former Exhibition Centres. Conversation Corner is a consultation hub on Lillie Road where the community can come, see the model, and learn all about how ECDC plans to bring the wonder back to Earls Court with their ambitious vision for this important site.
LCA’s engagement and creative teams worked together with ECDC, the architectural teams and Sleek Lab Events to produce a comprehensive exhibition using recyclable materials and a workshop-style peg board system. This hub will be ECDC’s main consultation venue for the rest of the project’s life and we designed everything to be flexible, modular, and movable to reduce waste and create a truly sustainable engagement. The LCA social media team then created an online paid and organic campaign to create a buzz online and pull people into the consultation. Watch our launch reel here to learn more!
Our media team secured fantastic coverage for this milestone – in sector, consumer, and national media alike. Over the next month, Conversation Corner will be open, alongside an online engagement, and we hope to see as many people as possible pass through the door to help shape the future of Central London’s most exciting development opportunity.
LCA is, as ever, headed to Cannes for the MIPIM property conference on 14-17 March. On Thursday 16 March, Senior Advisor Sarah Rawlings is chairing a morning session that will consider London’s role in securing the future success of town centres across the UK. We’ll also be supporting Avison Young with its biggest ever presence at the event, and catching up with a host of other LCA clients and friends. The theme of this year’s programme on the London stand at MIPIM is ‘Resilience & Reinvention’ focusing on the challenges the city needs to meet from changing lifestyles and working patterns to increasing interest rates and the cost of living crisis. Over three days, the MIPIM audience will hear from speakers tackling industry hot topics such as investment opportunities in life sciences, decarbonisation and net zero, social value and affordable housing. Sarah will be joined by Jane Groom, Partner & Co-Managing Director, Politics, Engagement and Planning, and Senior Advisor Robert Gordon Clark, who will be attending with his NLA hat on.
PADDY BACK AT THE GLA!
At LCA we will be very sorry to being saying goodbye to Paddy Hennessy, our senior advisor, who will be returning to City Hall from mid-May to work for his old boss, Sadiq Khan. Paddy has been with us since mid-2021 and we have greatly enjoyed having him as part of our team – but we understand the pull of politics is strong! Paddy will return as Khan's acting director of political and public affairs, as the Mayor attempts to win an unprecedented third term in next May’s elections.
LCA prides itself on its intelligence-led approach to PR and communications and our dedicated insight team monitors London politics, news and issues as it happens. If you would like to know more about LCA or anything in this edition of LDN – London in short please get in touch.
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