Canary Wharf Group, the UK’s second largest property company, wants compensation for London Underground’s (LU) failure to deliver promised Tube services to its multi-million pound office complex in east London. The developer had pledged £500m over 24 years towards the cost of building the Jubilee Line.
It is warning that persistent signalling breakdowns, initially described by LU as “teething problems” but still occurring almost two years on, could bring a halt to the development of east London. LU had also undertaken to lay on 24 trains an hour in each direction during the rush hour. At present no more than 20 trains an hour are in service.
Projects which the developer claims could be at risk include the planned regeneration of the Millennium Dome, office developments at London Bridge and London’s bid to host the Olympics at Stratford in 2012.
With the number of Canary Wharf workers who use the line expected to rise from 21,000 to some 77,000 over the next few years, any failure to improve the service will have a serious effect on businesses in the area.
Any large pay-out to Canary Wharf would prevent LU investing properly in the ailing Tube network. It has already complained that it will receive several hundred million pounds less from the government than was promised for capital works programmes.
Neither party to the arbitration is allowed to comment on the proceedings. However, it is believed that Canary Wharf is prepared to reinvest any money it is awarded in other transport improvements in the Docklands area.
EGi News 19/07/01
