Mount Anvil and Hyde Group have teamed up with Sainsbury’s to develop a scheme with a possible end value of £600m next to the Bakerloo Line extension at New Cross Gate, SE14.
The pair are the preferred bidders for a potential 1,400- home redevelopment of the seven-acre Sainsbury’s site in New Cross. They will form a joint venture with the retailer to rebuild the supermarket with thousands of flats above and alongside it.
The scheme could have a gross development value of between £500m and £600m, assuming an average flat price of £400,000.
Killian Hurley, chief executive of Mount Anvil, said: “Our design-led approach will deliver a new state-of-the-art Sainsbury’s store alongside homes for all Londoners and improved public space.
“The site will also act as a catalyst for the wide-scale regeneration of New Cross and provide a range of employment opportunities, including apprenticeships, for the local community.”
The site has previously had scoping proposals submitted for a scheme of around 400 homes. However, the jv partners intend to revisit planning options and boost density but also make the affordable percentage closer to the mayor’s guidelines.
Mount Anvil has provided affordable percentages of around 35% on a number of its London schemes, including the 308-home Lexicon on City Road, EC1, which included 107 social homes, and its Dollar Bay scheme on Marsh Wall, E14, which had an off-site commitment equating to 46% affordable.
Under the draft London Supplementary Planning Guidance, schemes with more than 35% affordable housing do not need to undergo a viability assessment.
Unit numbers on the site have yet to be determined, and could range between 1,000 and 1,500, but it is understood that around 1,400 is the preferred option.
Hyde was formerly part of the merger between L&Q and East Thames housing associations, but dropped out of the deal to pursue its own course of development. Mount Anvil is already working with Hyde on the TfL development framework, the transport operator’s 13-strong panel chosen to redevelop its central London sites.
Lending expert Peter Denton, formerly head of special situations at Starwood Capital, moved to Hyde as its new finance director last month. He said the sector was becoming increasingly relevant and he wanted to be involved in the opportunity.
The New Cross scheme is one of several that Sainsbury’s is redeveloping around the capital using the large store area of a supermarket to unlock residential development values while keeping a lucrative inner-London store footprint.
One of its first jvs, with Barratt in Nine Elms, SW8, unlocked 645 homes and a new supermarket. It has submitted a planning application for 560 homes above its Whitechapel, E1, store, and for 700 homes in Ilford.
Jamie Cowen, head of investment and planning at Sainsbury’s, said the New Cross store had been trading for more than 20 years and was extremely popular. He said regeneration would provide customers with greater choice, supply new homes and act as a springboard for further investment and development.
CBRE acted for Sainsbury’s.
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Article originally published on 10th March 2017
