In February, “outrageous” demands for s106/s278 contributions nearly scuttled the £4bn revamp of Brent Cross. This week, a £1bn sum cleared the way. By Paul Norman
After spending more than 10 years and £30m so far working up proposals to build 14m sq ft of shops, offices and homes in London, the Brent Cross Cricklewood Partnership (BXC) has at last brought certainty to the project.
In February, the prospects looked less than healthy for Standard Life Investments’, Hammerson’s and Brookfield’s long-mooted plans to build a 592,000 sq ft extension of the UK’s oldest indoor shopping centre, 7,500 homes and as much as 4m sq ft of offices.
Recession had set in, a corporate takeover had changed the nature of the players, and that month EG revealed that the scheme was in danger of stalling because of a row with Transport for London over how much the partnership should pay in section 106 improvements to infrastructure away from the site. Barnet, the local council for most of the scheme, complained that TfL had tabled “outrageous” last-minute demands for more than £20m that could be siphoned off to other areas of the capital (28 February, p25).
Moreover, Brookfield’s A$7.3bn (£3.8bn) takeover of Australian developer Multiplex in June 2007 had also led to market chatter that the Canadian fund manager, like its predecessor, wanted to sell out.
This week, the partners are preparing to silence any doubters after what BXC development director Jonathan Joseph terms a “watershed moment”.
On Thursday, the partnership announced that it would pay one of the largest single-project investment packages – including s106 and s278 agreements – agreed by a private developer in the UK. The £964m sum, funded entirely by the partners, will cover the construction of new train and bus stations, five bridges and a raft of environmental improvements.
Joseph says, phlegmatically, that the dispute with TfL was resolved after “natural creative tensions” had been worked out.
The agreement means that the Allies & Morrison-designed outline plans for the £4bn scheme is all but guaranteed consent from Barnet council later this month (23 September), bringing the 250-acre Brent Cross Cricklewood a step closer to becoming a reality.
“Despite the changes in the partnership, there has been great continuity in terms of the individuals working on the project,” says Brookfield Europe’s Brent Cross project leader Mark Rushworth. “Our introduction to the project has been painless and there has been no change in terms of commitment.”
Divided opinions
To prove his point, Rushworth stands shoulder to shoulder with Hammerson’s project leader Phillipa Zieba and Jonathan Joseph, development director for the BXC partnership, pointing to a wall-sized map of the scheme hanging in the partnership’s Grosvenor Square office.
Zieba concurs: “I’ve been consulting on this for seven years and the main thing we hear from local residents is not opposition but ‘when are you going to get on with it?’”
Not that all local residents are supportive. As a decision on the outline plans has loomed, opponents of the project have become increasingly vocal.
MP for Brent East Sarah Teather has appealed to secretary of state for communities and local government John Denham, urging him to respond immediately to a petition against the scheme.
Teather claims that, while Barnet might benefit from all the “shiny new buildings”, the people of Brent will get little more than 29,000 extra cars a day on the roads and the siting of a controversial “green” waste facility just off the Edgware Road.
In fact, the replacement of the council waste station close to Staples Corner with what the partnership calls a “state of the art” combined heat and power plant 100m away on Tilling Way is drawing the most energetic opposition.
Cash-and-carry group Bestway, founded by multimillionaire tycoon Sir Anwar Pervez, owns the site and is vigorously campaigning against the proposals.
Brent Friends of the Earth has joined in, claiming that the facility the partners are proposing is in fact an incinerator. Countering this accusation, Joseph says that the partners are ready to sign a legally binding document confirming that an incineration plant will not be built.
Moreover, even if the partners are successful in winning outline consent, the three agree that they will still have their work cut out if they are ever to transform the busy transport interchange bordered by Brent Cross to the north, the A1 to the east, the A5 to the west and cut in two by the north circular and the Midland mainline railway line into Brent Cross town centre.
The biggest battle, given the property downturn and lack of property finance available, will be persuading the banks to lend BXC the £3.5bn required to start building the £1bn first phase comprising 1,200 homes, a 300,000 sq ft extension to the Brent Cross shopping centre and a new road bridge.
Rushworth says, however, that this is still some years away. Work is not scheduled to begin on site until at least 2012. “We are always talking to the market but there is a way to run before we seek senior debt,” says Rushworth. “We have an outline consent to work up in more detail to first phase and a strategy to agree for the CPO process.”
Instead, if the planning decision goes in its favour next week, the partnership’s first job will be securing a compulsory purchase order for the circa 20% of the site that the partners do not own.
Leaseholders that will need to be relocated include Tesco – which is in talks to take an expanded store closer to the scheme’s town centre – Toys R Us and the thoroughly opposed Bestway.
At the same time, architects, planners and advisers will need to be assembled to work up detailed plans initially focusing on the £1bn first phase.
These plans are, says Joseph, the scheme’s “most exciting” element. “The idea is to turn Brent Cross inside out,” he enthuses.
A John Lewis department store will be built on what is now the main car park and a “seamless passage” will be created that will link the shopping centre to a new multiplex cinema and cafés, restaurants and outdoor leisure amenities fronting a naturalised and opened up River Brent.
Another challenge still to be faced by the partnership will be finding occupiers for the 4m sq ft of offices that are to be built around the proposed new Midland railway station – even if the economy has recovered from recession.
But Rushworth says this has been taken into account. “We are developing in bite-sized chunks, with the commercial coming out at the back end. The scheme in the early phases is focused on residential and we feel comfortable with that,” he says.
Chris Hiatt, international director at Jones Lang LaSalle, who has been advising the partners on the area’s potential as a business location, is bullish: “It’s a part of London where there are not that many big schemes coming forward – there is Cricklewood and there is Wembley and that’s it. But the demographic is good and the project has got scale and is well connected.”
Joseph is also excited about the 1,200 homes that are set to replace the run-down Whitefield housing estate and the shopping centre’s south-west car park. He is scathing about the poor quality of the existing buildings and their failure to foster any sense of community. Joseph says that the partners will introduce management and development that is “blind” to tenure. “We will integrate affordable housing cheek by jowl with market rented housing,” he says.
“The key to the entire scheme is the creation of a sense of community,” he adds. He points out that, as part of its s106 commitment, the partnership will fund improvements to the area’s green space and its three schools. There are even plans afoot to commemorate the Golders Green Estate’s role as home, until 1929, to the Handley Page Aerodrome – the UK’s first international airport – with a local air display.
“What is vital is to not parachute in a scheme but to build a community and a sense of place,” says Joseph. “That is the true test of successful real estate development.”
How two plans became one
January 1996 Hammerson and Standard Life lodge outline plans for the expansion of Brent Cross shopping centre
September 1998 Deputy prime minister John Prescott calls in the extension plans
October 1998 Railtrack starts seeking a development partner for a mixed-use redevelopment of its 85-acre Cricklewood Sidings site, adjacent to Brent Cross shopping centre
1999 Bellhouse Joseph enlisted by Pillar Property and Railtrack as development manager for the Cricklewood Sidings project
June 2000 Prescott throws out Hammerson’s and Standard Life’s plans to extend the shopping centre
June 2001 Pillar and Railtrack lodge plans for an 8m sq ft revamp of Cricklewood, which include three hotels and 2,500 homes
December 2002 Hammerson buys Railtrack’s development portfolio in a strategic move that gives it a 50% stake in the Cricklewood scheme
December 2004 Australian developer Multiplex buys out Pillar’s 50% stake in the Cricklewood development
September 2005 In its UDP, Barnet council supports a masterplan linking Hammerson’s and Multiplex’s Cricklewood site with Hammerson’s and Standard Life Investments’ proposed extension of their Brent Cross shopping centre. This paves the way for the 250-acre Brent Cross Cricklewood scheme
June 2007 Canadian fund manager Brookfield takes over Multiplex
March 2008 Brent Cross Cricklewood Partnership submits outline plans for a 250-acre scheme
September 2009 £964m investment package funded by the BXC partners is signed off, clearing the way for the scheme to proceed
A massive shopping centre with a town attached
The BXC scheme proposes: a 592,020 sq ft sq ft extension of Brent Cross shopping centre; 7,500 homes, including apartments overlooking the River Brent; the redevelopment of three schools; 4m sq ft of offices – possibly including a 25-storey tower – adjacent to the mainline station; a leisure complex next to the River Brent, providing cafés, restaurants and a multiscreen cinema; four new parks and improvements to Clitterhouse Playing Fields; major transport improvements including a Midland mainline train station connecting to King’s Cross, a new bus station, and new junctions off the A41 and A5.
The centrepiece will be a new high street linking the western end of a new town centre to the shopping centre in the north.
