Crossrail 2 and the Northern Line extension (see image above) could deliver a £1.2bn boost to London’s office landlords in the next decade.
Around two-thirds of the value rise will be delivered by Crossrail 2, as £830m is added to office values, over and above general market improvements, over the next ten years, according to exclusive research from Carter Jonas. A further £360m could be made along the extended Northern Line, said the agency.
Battersea and Nine Elms will see the biggest benefit, with conservative estimates showing a £196m-£360m increase in office values, a rise of more than 25%.
More established locations such as Euston/King’s Cross, Tottenham Court Road and Victoria will also be boosted by more than £100m but representing a more modest 2-7% rise in capital values.
Developers have taken a keen interest in Crossrail sites, and around Charing Cross Road alone Soho Estates, Great Portland Estates, Derwent London and Almacantar have already announced plans to redevelop over 1m sq ft of space and 250 homes. Derwent London said last month that 80% of its portfolio was either in the techbelt, close to Crossrail, or both.
Larger gains of 15% will be made in Dalston, Tottenham Hale and Shepperton, the agency believes, although off a lower base, equating to under £5m in real terms.
In Hackney, Kennington and Surbiton gains will be less pronounced, rising by less than 5% and under the £5m mark.
However, the agency warned that without further investment the system will quickly become overcrowded especially around Euston, Waterloo and Victoria.
“There are also still areas in London that need unlocking to cater for the longer-term growth of the capital, such as continuing the Northern Line extension on to Clapham Junction, which would be a real opportunity for spreading the Battersea/Nine Elms area further west,” said Tim Shaw, development partner at Carter Jonas.
nadia.elghamry@estatesgazette.com
