THEN & NOW THE HISTORY AND FUTURE OF REGENERATION & PROPERTY IN THE UK'S CAPITAL CITY - Surrenden Invest
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LONDON T H E N & N OW THE HISTORY AND FUTURE OF REGENERATION & PROPERTY IN THE UK’S CAPITAL CITY
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LONDON THEN & NOW
8.7million
London single-handedly
accounts for 17% of the UK’s
gross domestic product (GDP).
WELCOME
TO LONDON
The capital city of the UK, London is a vibrant, world-renowned metropolis that draws in
tourists and workers in their droves. Home to around 8.7 million people, the city single-
handedly accounts for 17% of the UK’s gross domestic product (GDP). It is a hive of activity, with
entrepreneurs and industry experts spreading their talents across a wide range of sectors.
Economy aside, London leads the UK in many ways, from its cultural offering to its retail scene. It is
home to three of the UK’s five three-Michelin star restaurants and 10 of the country’s 20 two-star
establishments (along with a staggering 54 one-Michelin star venues). It is the most-visited city in
the UK and the second most-visited in the world.
London is a key destination for foreign direct investment (FDI) as well. It leads the UK in this respect
and is the world leader in terms of financial services FDI projects.
LONDON THEN & NOW
+34.0%
Digital project sector grew by 34% in
2017 – more than three times the rate of
overall market growth across Europe
WORLD-CLASS When it comes to investment opportunities, the range of options available in and around
London is staggering. London attracts investors from around the world thanks to its global
INVESTMENT reputation, booming economy and wealth of available opportunities.
OPPORTUNITIES EY’s 2018 UK Attractiveness Report highlights the UK as the main destination for FDI in Europe. Within the UK,
London was the top destination for FDI.
IN & AROUND The UK attracted more financial services FDI than any other European country in 2017. London, meanwhile,
thanks to its position as a global leader in the financial services industry, attracted more than double the
LONDON number of projects of Paris (26), Dublin (26), Frankfurt (24) and New York (20) in 2017, securing 55 inbound
financial services FDI projects during the year.
London is also a key destination for digital project FDI. This sector grew by 34% in 2017 – more than three
times the rate of overall market growth across Europe and significantly more than the rate of 22% across the
“The capital has been the jewel in the UK’s FDI UK as a whole.
crown for several years, attracting more projects
FDI projects in London rose from 446 in 2016 to 459 in 2017. This represents half of the overall growth
in 2017 than some countries in Europe.”
rate for the country. Investors are drawn to the city and its surrounding commuter belt area thanks to its
EY 2018 UK Attractiveness Report
world-class business environment, infrastructure and vast regeneration projects, from individual housing
developments to entire areas.
LONDON THEN & NOW The Orion, in the town of Luton in London’s thriving commuter belt, is an example of how investment and regeneration work hand in hand. London Luton Airport is undergoing a major expansion (the largest in its history – more on that below) and driving forward a programme of works in the surrounding area as a result. The Orion’s apartments are a part of the area’s expansion, with both investors and renters keen to be involved in Luton’s growth and regeneration.
LONDON THEN & NOW
CENTURIES OF
REGENERATION
As at January 2019, a staggering 510 tall buildings were included in London’s
future regeneration plans, let alone the hundreds (if not thousands) more
smaller dwellings. This intense rate of building is something of a feature of life
in London. In fact, the city has been undertaking regeneration projects at a
phenomenal rate for centuries.
The Great Fire of London sparked one of the city’s most intense regeneration periods.
Following the loss of nearly 80% of the City of London in 1666, the following two decades
saw between 12,000 and 15,000 new buildings completed as Londoners sought to rebuild
their homes and their city’s economic prowess.
Those rebuilding London after the fire took the opportunity to make their city bigger
and better, with streets being widened and redesigned in order to make London more
accessible for future generations and avoid overcrowding.
Centuries later, this focus on the legacy of regeneration work in London continues, as we
can see from the city’s recent successes.
LONDON THEN & NOW
£8.76bn
The overall cost, from building to hosting
the games, came in at £8.77 billion.
One of the largest recent successful regeneration projects in London in recent years was the work undertaken in and
around Stratford in order to prepare for the London 2012 Olympic and Paralympic Games. Many of the areas that
benefitted from the regeneration work had seen little notable improvement since the rebuilding that followed World
War II, so the Olympics offered a unique opportunity to breathe new life into East London while creating a lasting legacy.
REGENERATION
As a result of the Olympic regeneration work, the city area gained the Olympic Stadium, Copper Box Arena, London Aquatics Centre,
Lee Valley White Water Centre and beautiful Queen Elizabeth Olympic Park, as well as range of other venues, commercial premises and
thousands of housing units. The overall cost, from building to hosting the games, came in at £8.77 billion.
Another recently completed regeneration success, right in the heart of the capital, is London City Island. The development has created a
new island neighbourhood, with 1,700 new homes, artisan shops and restaurants, stunning outdoor spaces and creative hubs. Culture and
creativity were at the heart of the regeneration work, leading both the English National Ballet and the London Film School to relocate there.
LONDON THEN & NOW
£7.0bn
The London Bridge Station
work was part of the £7 billion
Thameslink Programme.
London’s vast transport network has also been the focus on significant regeneration funding over
the years. Most recently, London Bridge Station took its turn in the spotlight, with HRH Prince
William, The Duke of Cambridge, officially reopening it on 9 May 2018. New platforms, a new Luton
concourse and better connections have increased the station’s capacity and accessibility, as well as
improving the overall traveller experience.
The London Bridge Station work was part of the £7 billion Thameslink Programme, which
is improving infrastructure and stations across London as part of its regeneration focus.
Together with housing and commercial regeneration projects, such work is ensuring that
London and the commuter belt remain fit for purpose, both now and in the future.
Brentwood
Queen
Gerrards Harold
Elizabeth Wood
Cross The Duke of Olympic Park Chadwell Romford
Seven Ilford Heath Gidea
Cambridge Kings Park
Manor Park Goodmayes
Maryland
Forest Gate
Farringdon Stratford
Taplow Burnham Ealing Tottenham
Maidenhead Whitechapel
Broadway Court Road
Langley West Drayton Hanwell Custom House
Southall Paddington
Slough West Acton Bond
Iver Main Line Canary Wharf
Ealing Street Abbey Wood
Hayes &
Harlington
Twyford Woolwich
Reading London
Heathrow London
Airport Bridge
Reading City
Station
Island
LONDON THEN & NOW
2,000,000
An estimated 2 million travellers per year
will use the new Elizabeth Line service.
A WORLD-CLASS
INFRASTRUCTURE
Infrastructure projects are unique in their potential to benefit Londoners spanning a vast
area. New train and underground systems, or upgrades to existing networks, are vastly
expensive projects, but also have the potential to benefit millions of people.
One regeneration project which is benefitting both central London and parts of the commuter belt is
Crossrail. Also known as the Elizabeth Line, the 60-mile scheme will extend from Reading and Heathrow in
the west to Shenfield and Abbey Wood in the east, increasing London’s rail capacity by an impressive 10%.
Parts of the Elizabeth Line are already open, with trains due to run all the way to Reading by December
2019. An estimated 2 million travellers per year will use the service and, with a price tag just shy of £15
billion, it is the largest civil construction project in Europe.
Transport network regeneration and extension projects such as Crossrail have a huge impact along the
route, acting as a catalyst for further regeneration work and other forms of investment. Reading is a prime
example, with investors keen to snap up everything from commercial units to buy to let apartments in order
to enjoy the economic benefits that the Elizabeth Line will bring.
LONDON THEN & NOW The HS2 rail network will also bring signficant benefits, connect some 30 million people along the course of its route from the Midlands to London. Within London, Euston train station, where HS2 will terminate, will undergo a major upgrade, with 11 new high speed platforms. In addition, a ‘super-interchange’ will be built at Old Oak Common, connecting HS2 to Crossrail and Great Western Main Line services. Construction work will run from 2019 to 2026, for the first phase of HS2 and to around 2033 for the second phase. The new network comes at a cost of £55 billion, though there is widespread belief that the budget will be overspent significantly.
LONDON THEN & NOW
£700k
the Southbank Centre will benefit
from a cash injection of £700,000
ALLOWING CULTURE
TO FLOURISH THROUGH
REGENERATION
London and the commuter belt aren’t all work and no play. In fact, a number of
cultural initiatives are underway, following Mayor of London Sadiq Khan announcing
£24 million worth of funding for cultural projects in 2018.
The money is covering an exciting and eclectic range of cultural projects, from the creation of a
National Centre for Urban Culture in east London to the redevelopment of an arts/learning centre
in Herne Hill. Peckham will receive a new, mixed-use cultural space while the Southbank Centre will
benefit from a cash injection of £700,000.
Other projects to receive funding will include Somerset House, two creative workspace projects in
Hackney, an edible sustainable community garden at Battersea Arts Centre and a number of works
in Redbridge town centre.LONDON THEN & NOW “I am using this funding to challenge preconceptions about how regeneration takes place. I want to give all Londoners – regardless of background – the opportunity to be actively involved in their city and have more places to live, learn, work and play. The projects I announced funding for today will help us to tackle inequality, strengthen civil society, and ensure the benefits of regeneration are felt by all.” Sadiq Khan, Mayor of London
LONDON THEN & NOW
£68.0bn
London leads the world as a net
REGENERATION & THE ECONOMY
exporter of financial services, with
these totalling £68 billion in 2017.
London is a growing city. Its 2016 population of around 8.8 million people is expected to grow to around 9.3 million by
2021. Regeneration work is serving to make the city and its commuter belt into a more attractive, better functioning
environment for all those who live, work and visit there (the latter being around 20.42 million people per year).
London’s economy is what draws many people to the city to work. It was the city’s ability to trade effectively that spurred on much of the
rebuilding work following the Great Fire of London back in 1666 and that drive to ensure that London functions effectively can still be felt in
today’s regeneration projects.
KEY INDUSTRIES IN LONDON TODAY INCLUDE:
- Financial Services (London leads the world as a net exporter of financial services, with these totalling £68 billion in 2017)
- Pharmaceutical and Private Healthcare
- Digital, Media and Technology,
- Tourism
- Retail
- Fashion
- Property
- Legal ServicesLONDON THEN & NOW
£425bn
In total, London’s GVA stood at over
£425 billion in 2017 – an increase of
3.0% in real terms on 2016
work hard, play hard...
Such a vast city is, of course, home to many more industries besides these. Based on
this melting pot of sectors, London’s gross value added (GVA) accounted for 23.8%
of the UK’s total output in 2017. This represents the largest share since the Office
for National Statistics (ONS) began producing data in this format, back in 1998.
In total, London’s GVA stood at over £425 billion in 2017 – an increase of 3.0% in real terms on
2016. GVA per workforce job (with which the ONS measures workforce productivity) stood at
£72,371 in London in 2017, compared to a UK average of £51,297. London is a city where people
come to work hard and play hard, with developers in and around the capital racing to ensure that
they have a fitting environment in which to do so.LONDON THEN & NOW
THE COMMUTER BELT:
SPOTLIGHT ON LUTON
London’s commuter belt, like the city itself, is vast and varied. However,
certain areas stand out due to their regeneration potential and the
economic benefits that such regeneration is set to bring.LONDON THEN & NOW
30 miles northwest of London, Luton is one such area. It is home to London Luton Airport, which is currently
undergoing a £160 million regeneration that will see passenger capacity increase to 18 million travellers by
2020. The fifth busiest airport in the UK, Luton is both the fastest-growing major London airport and its
leading business aviation airport (it is, in fact, one of the top three business aviation airports in Europe).
London Luton Airport contributes £1.3 billion annually to UK GDP and £648 million to the Treasury. It accounts for 10% of
employment in Luton itself. In 2015, the airport was granted enterprise zone status by the UK government, meaning that
it can offer reduced business rates to new companies and to existing businesses that are looking to grow and/or relocate.
“This is a new era for LLA. We are the fastest-growing major London airport and are now in a
position to play an increasingly important role in the UK’s aviation network.”
Nick Barton, CEO, London Luton AirportLONDON THEN & NOW
£1.5bn
1.5 billion of private investment
pouring into Luton to span a wide
range of projects, including new homes
The Luton enterprise zone incorporates three sites: Century Park; Airport
Business Park and Stirling Place. The ambitious programme of work will
include a £100 million road infrastructure scheme and the creation of a
£200 million Mass Passenger Transport system that will connect the airport
terminal directly with Luton Airport Parkway train station. Commercial
offices and retail premises are also incorporated into the plans.
As is the case with so many regeneration initiatives, Luton’s enterprise zone status and
airport expansion have acted as a catalyst for economic growth, with £1.5 billion of private
investment pouring into the town. This has spanned a wide range of projects, including
new homes for those looking to live in Luton and enjoy all the advantages that life in this
popular commuter town offers.LONDON THEN & NOW
L U TO N P RO P E RT Y:
THE ORION Just a 10-minute drive from London Luton Airport and just two minutes from Luton Station, in the heart of the
town, The Orion represents just the sort of knock-on benefits that large-scale regeneration schemes can have.
The 67 one- and two-bedroom apartments at The Orion have been designed with professional tenants firmly in
mind. Location-wise, they are ideally suited to those commuting into London. Trains from the nearby station run
direct to London St Pancras International in just 22 minutes.
The stylish, spacious interiors have also been designed with contemporary renters in mind. Convenience meets
luxury in these high-end homes, making them an attractive option for those looking to work in London but to
avoid the capital’s eye-watering rents.LONDON THEN & NOW
FROM AN INVESTMENT PERSPECTIVE, LUTON HAS STRONG
MARKET FUNDAMENTALS THAT MAKE THE ORION AN
EXCITING PROPOSITION. APARTMENTS THERE ARE PRICED
FROM £172,900, WITH 6% NET YIELD PER ANNUM ASSURED.LONDON THEN & NOW
THE COMMUTER BELT:
SPOTLIGHT ON
GERRARDS CROSS
20 miles northwest of London, Gerrards Cross is another convenient, affordable
commuter belt town. The friendly community topped CBRE’s list of the most
sought-after homes for London commuters in 2015, as well as being voted the
favourite commuter town in the country in 2014 as part of the London Hot 100
report. In 2017, it was second on the Evening Standard’s list of top commuter
towns to the north of London.LONDON THEN & NOW
Gerrards Cross’ proximity to London is a key reason for its popularity. Less than two miles from the intersection of
the M40 and M25 motorways, and just a 20-minute direct train journey from London Marylebone, the town provides
fast, easy access to the capital by both road and rail.
OPPORTUNITY However, there’s more to Gerrards Cross than its potential as
a commuter belt location. The town sits at the entrance to the
and there are four more farmers markets held regularly within a
ten-mile radius, for those who are committed to enjoying fresh,
Chiltern Hills, making it popular with families and those looking seasonal produce at every opportunity.
to enjoy the great outdoors. The presence of a number of
Gerrards Cross has plenty going for it from an investment
independent primary and secondary schools, along with some
perspective, too. Its popularity as a commuter town means that
excellent grammars, furthers the town’s family-friendly credentials.
there are plenty of professionals looking to rent in Gerrards Cross
For down time, Gerrards Cross has a boutique Everyman Cinema, while working in London. This sustained demand is ideal for those
lawn tennis courts and a host of independent shop, restaurants, looking to invest in buy to let projects in order to enjoy healthy
delicatessens and the like. A monthly farmers market provides a yields over the medium and long term.
chance to indulge in some locally produced gastronomic delightsLONDON THEN & NOW
ASTON HOUSE
GERRARDS CROSS PROPERTY:
ASTON HOUSE Well positioned for access to Gerrards Cross town centre, Aston House is a contemporary
residential development consisting of 32 apartments spread over five floors. The one- and two-
bedroom homes provide sleek, stylish accommodation for professionals looking to blend the best
of London with a less frenetic pace of life.
Aston House features a mix of classic, protruding balconies and Juliet balconies, while internally
apartments are home to spacious, open plan living areas and contemporary kitchens and bathrooms.
Floor-to-ceiling windows ensure that the homes are flooded with light.
The local area includes a Waitrose supermarket and the Everyman Cinema, while Gerrards Cross high
street is also close by.LONDON THEN & NOW
ASTON HOUSE
DEVELOPED TO SUIT BOTH INVESTORS AND OWNER-OCCUPIERS
– FROM FIRST-TIME BUYERS TO DOWNSIZERS – THE HOMES
OFFER EITHER ONE OR TWO BEDROOMS, SITUATED 20-MINUTE
DIRECT TRAIN JOURNEY FROM LONDON MARYLEBONE.LONDON THEN & NOW
WEMBLEY PARK
The 20-year regeneration of the area around the world-famous
Wembley Stadium has already seen hundreds of homes built,
along with commercial units and a state-of-the-art theatre.
Thousands more homes, shops, a 70-acre park, a hospital,
office space, restaurants and a primary school will follow
between now and 2024.
NINE ELMS
The 500-acre Nine Elms regeneration began in
the 2000s. By 2025, Battersea Power Station will
THE FUTURE OF
have been transformed into offices, hotels, two
tube stations and thousands of homes.
REGENERATION
IN LONDON
London’s size and appeal mean that the city will never be ‘finished’ but will instead
undergo continual regeneration, as planners and investors shift their focus from one
area to the next. At the same time, the commuter belt will continue to expand, as
infrastructure improvements make journey times into the capital faster and bring new
ROYAL WHARF
destinations into the commuter belt footprint.
The 40-acre waterside Royal Wharf regeneration project will
encompass restaurants, bars, a primary school and nursery and nearly
Billions of pounds will be poured into London over the coming years, with a number of 4,000 apartments. Completion is due around 2019-20.
These projects are the tip of the iceberg. The Mayor of London and
key projects coming in with price tags of £1 billion or more. Some of the most significant
London Assembly together list over 130 regeneration projects in and
to take place between now and 2025 are shown below. around London at the time of writing. For investors looking at London
and its commuter belt, many of these projects present interesting
opportunities to become part of the future of this world-class city.PLEASE CONTACT US TO DISCUSS THE NEXT STEPS Riverbank House London Office: 0203 3726 499 1 Putney Bridge Approach info@surrendeninvest.com Fulham www.surrendeninvest.com London SW6 3JD We make no representation or warranty of any kind with regard to the information contained in this brochure and none of the information shall be treated as financial advice. The information is not an invitation to invest and you must rely entirely on your own investigations and due diligence before making the decision to invest. Any opinions expressed in this document are not statement of facts.
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