London should ‘pull together’ to weather economic storm

Wednesday 18 January 2012

London faces stiff challenges in 2012 across most sectors, largely due to the fallout from Europe’s wider economic uncertainties. But the development community can grasp opportunities from the Olympics and pull together to forge innovation, even from limited finance.

Those were the key findings of the latest meeting of the NLA Sounding Board, an elite panel of thinkers and practitioners from the world of architecture, planning and property development. 

In his presentation at the event on Tuesday, the LSE’s Tony Travers said that the capital had been paralysed into uncertainty, along with much of the rest of the country, now approaching a double-dip recession. That uncertainty is feeding through into the London economy, although a more optimistic small indicator is that tube and bus ridership is rising, he said. 

There is no shortage of equity available, but a paucity of sites available for development, said Stuart Robinson of CBRE, looking at planning in the run up to the publication of the NPPF, expected, he said, in March. The public sector he added, has got rid of people and held onto assets, the big example being hospitals, which could take advantage of development opportunities. Robert Gordon Clark said that the NHS has some 13 sites it wishes to dispose of, of over 0.25 hectares across London – the largest 3.75ha –and 2,000 staff looking after its property interests.   

The current environment is a difficult one for commercial development, said Land Securities’ Colette O’Shea, with banks tightening their lending and the only investment being from abroad dwindling once those investors learn of the vagaries of the UK planning system. ‘I’d go so far as to say there is virtually no cash available for commercial development’, she said. The residential market in central London is good but rate of sale is slowing comparatively to 12 months ago. There needs to be more collaboration between funder, local planning authorities and occupiers, with ‘more of an understanding that we are in a difficult world so all have to pull together to make things happen, drive jobs and the economy.’ 

The creative industries represent the future of London, said Derwent’s Richard Baldwin. Argent’s Robert Evans agreed, remarking that the opening of Central St Martin’s was changing the type of interest coming in regarding the King’s Cross site. Ralph Ward, presenting a guest paper on regeneration offered one reassuring insight when he said: ‘There is always money to be found somewhere for good projects, and it seems to me there is money to be made in London in the longer term’. 

On transport, the recent government decision to green-light High Speed 2 was an encouraging step, although some on the panel questioned why investment in maintenance and upgrading the existing system had not come first, with others signalling their concerns that HS2 might not happen at all. But Old Oak Common represents a significant opportunity to ease the interchange and perhaps become a ‘Canary Wharf 2’, alleviating possible problems of hold-ups for travellers at Euston, a station which will also be the subject of redevelopment. HS2 also offers the possibility of ‘opening up’ areas such as Willesden, North Acton and Hammersmith to social and economic change, said Pat Hayes of Ealing. The Chelsea-Hackney line is another long-term proposal Transport for London wants to see delivered, said Alex Williams, and will be cheaper to build than Crossrail. 

Matthew Butters of Pascall + Watson introduced a paper on air travel, saying that Government had showed it had little in the way of aviation policy – excepting the news that PM David Cameron will look at a feasibility study into a new airport – including Boris Island – for the capital.  Government projections have aviation growth rising for the next 30 years. But the problem exists now; coming up with a solution in 15-20 years will be too late – ‘the traffic and the business will have flown away.’ 

Finally, Sarah Weir offered an upbeat finale with a look at the legacy of the Olympics, plus a plea to make the Olympic Park a zone two rather than zone three destination. The ODA has commissioned a report called ‘square pegs in round holes’ looking at the unprecedented commissioning of pop-up spaces and art projects in an Olympic Park, as is happening in London. ‘Personally’, she said, ‘I think we should keep on putting square pegs in round holes so we don’t have the homogenous space that cannot make the most of itself.’    

David Taylor, Editor, New London Quarterly

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