The last ten days have not been a happy time for the London built environment community.
Taylor Wimpey announced a complete withdrawal from the London development market. Another major scheme in Southwark went down amid an increasingly anti development culture amongst the Borough’s political class.
Molior data confirmed just 1,440 homes sold in London during Q3 — the lowest since Q1 2009. The brownfield emergency notched up a gear and Berkeley CEO Rob Perrins’ 2025 prediction that thousands of jobs would be lost across the development sector looks increasingly the case.
Yet there are some green shoots of positivity out there which I think will, in the medium term, bring us together as a built environment community and lead to a turnaround in fortunes.
London is not in terminal decline
The first thing to say is that London is not in terminal decline. Everything is fixable and the Capital is still an amazing place with huge potential.
This is a human-made emergency and it can be repaired with time and patience. The foundation stones which make London great are there. The rigorous land value capture thesis is truly bust and the ratchet needs to be unravelled.
All of this is possible with political will. The Mayor’s office responded to the CEO of Taylor Wimpey recognising that instruments such as late stage reviews for examples are not fit for purpose. The penny is finally dropping.
I attended a Wandsworth Council developer forum on Tuesday afternoon. The Battersea Powerstation next phases are coming forward and the Council’s leadership was absolutely one hundred percent clear that it wanted new development. Not of all London has switched off and much of London is realising that a more flexible approach is needed.
It was standing room only as what’s left of the London built environment community listened to new Leader Cllr Rob Morritt and Chair of Planning and London veteran Cllr Ravi Govindia lay out a more pro housing vision for the Borough following four years of lost opportunity.
The clues are in the Southwark decision
Second, the clues for how we solve this emergency are actually within the Southwark decision — if we care to look. It has revealed an important truth of the brownfield emergency. The so-called ‘tariff stack’ which sits on the shoulders of every site needs consolidation and much more flexibility.
City Hall has already understood this. It is already making the case to Government behind closed doors.
At last week’s Southwark committee there was over £25 million of CIL on the table. If the CIL were not a statutory and ring fenced pot, it could have been used as a chip to negotiate and boost the affordable housing on site. It might not have got to 35% — that world has gone — but it could have made things more palatable than what was on offer. It would potentially have averted the overturn and all the pain that comes with it.
To my mind it is now only a matter of time before we reset the tariff structures and put them on a more level footing. The Emergency Measures have started the ball rolling and the Draft London Plan requires Borough CIL to be reduced by 80% to underpin the policies.
I also understand from a source in Whitehall that Government is taking a careful look at the behaviours of the Southwark Committee. It will be potentially using it as an example to push for a more effective rules based approach to political decision making in the future.
Patience — and the Laffer curve
Patience, more data, and openness on the part of policy makers to accept that the Laffer curve is real — and that it applies to development economics as much as it does to personal taxation.
The numbers are hard to ignore and the brownfield emergency is fixable. The next step is political will. London has everything else it needs.
