Roger Madelin has been confusing his new colleagues for a few weeks now. Lycra and cycling shoes are not normal attire in meetings at British Land. But London housing’s crisis requires radical solutions. There is little room for conventional thinking – and a change of attire might be a potent symbol for a wider revolution.
Madelin may only have started at BL this week but he has been cycling into the office for longer. And this week his plans for as much as 7m sq ft of development at the 46 acres of Canada Water, SE16, are unveiled: 3,500 homes will be at its heart .
The developer wants the project to have the same transformational impact as King’s Cross, N1, a project led, of course, by Madelin. Delivering the tens of thousands of additional homes needed in the capital – the numbers are so disputed, and the gap widening, that I will refrain from including any definitive number – requires projects of this scale.
But it also requires new thinking.
And that arrives this week courtesy of Related Companies, the largest owner and developer of affordable housing in the US.
Related is already a partner of Madelin’s alma matar Argent and this week extended its interest in London real estate by taking a 50% stake in discounted housing provider Pocket. (Do keep up at the back…)
Pocket, which works closely with the Greater London Authority, pledges to draw on “Related’s access to capital, scale and expertise”. It could prove a potent partnership.
But what has the potential to trump both of these considerable leaps forward is Transport for London’s new property partnership framework. TfL this week selected 12 propco partners it will work with to develop as many as 10,000 homes across 300 acres of its land on 50 sites. All are, of course, well connected transport wise.
TfL is looking to generate £3.4bn of revenue beyond fares by 2023, so it has an imperative to act.
And note too that those 300 acres are but a fraction of the 5,700 acres held by TfL. Not all will be developable or suitable for housing, of course. But it could be the beginning of a significant pipeline.
Last year’s inaugural Estates Gazette/Peter Wilson lecture at Fitzwilliam College, Cambridge, could hardly have gone better. Lord Heseltine delivered a tour de force on the past, present and future of regeneration. In doing so he set the agenda on so much of what has dominated the property world over the past 12 months: not least infrastructure investment, devolution and inward investment.
I am delighted that, with housing dominating the agenda in 2016 – evidenced above – Lord Kerslake will be delivering the follow-up lecture on 25 February.
Kerslake is chair of the London Housing Commission, which in March will deliver its report on how the capital’s housing crisis can be solved. He is also a former head of the Civil Service, the Homes & Communities Agency and currently chairs Peabody.
With public sector land having such an important role to play in serving up solutions, no one is better placed to set out a way forward on housing provision. For more details and to register for the lecture, e-mail rebecca.kent@estatesgazette.com.
The Heron Tower – sorry, the Salesforce Tower… apologies, 110 Bishopsgate, EC2 – has secured a new finance package valued at around £400m, representing around 55% of the fully-let building’s value. It is remarkable not just because it perhaps puts paid to last year’s stop-start sale process, but because of the cost of debt.
The margin in the previous arrangement, under a higher LTV, was around 450bps. This latest package is a keen 125bps. Suggestions that the financing market had cooled this year, with banks struggling to syndicate loans, may be wide of the mark.
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