The banking crisis and economic meltdown of 2008/9 leaves many London local councils and their developer ‘partners’ with stalled regeneration schemes.
Investor confidence plummets.
Potential funding evaporates.
MIPIM and LREF
Some local councillors and council officers respond by establishing regeneration partnerships and contractual formal agreements with private developers.
They create new ‘vehicles’ that more closely bind local councils to developers.
Local council leaders and appointed regeneration chiefs clink glasses and seal these deals with developers and property investors at MIPIM, the annual international property trade exhibition at Cannes in the south of France.
In 2013, London’s Berkeley Square in Mayfair hosts a similar annual event, the London Real Estate Forum.
By this time, UK national and local London politicians become obsessed with economic growth – almost at any social or environmental cost – to show they preside over a general economic recovery from the post-meltdown recession.
Simultaneously, London’s regeneration and renewal sector becomes obsessed with transferring as much public land to private developers as possible. The interests of developers, their parent companies and shareholders dominate regeneration deals agreed with local politicians.
Developers ‘parcel’ land sites together.
Politicians and developers invest much of their careers in these schemes – and show no mood for compromise with London residents and traders who oppose their plans.
Successful developer-led regeneration in London becomes defined chiefly as developers building optimal swathes of new luxury homes to achieve the highest possible sale profits and rental yields.
A net loss – and in some cases – a complete loss of council housing is an inevitable consequence of this developer-led regeneration approach.
Affordable housing – once proudly heralded as a justification for developer-led regeneration – also becomes a casualty of this rush for profit and high-yield.
Up and coming
Developer-led regeneration rests on an assumption – ‘it can only be good if new homes attract ever-appreciating property prices and rising rents’. Schemes tend to be on development sites within commuting distance of London’s ‘central activities zone’ – the City, West End and Canary Wharf. According to this assumption, wealth will trickle and even cascade into poorer areas.
But little wealth cascades or trickles down to Londoners on average and lower incomes.
Regenerated sites are deemed successful if new home re-sale values and rental yields rise.
Regeneration is also lauded if it brings outlying and less affluent areas closer to the price range of London’s original ‘prime’ luxury residential markets in Westminster, and Kensington and Chelsea.
A multi-billion pound ‘regeneration industry’ (developers, quangos, and vast reams of consultants) heralds developer-led regeneration as a natural and beneficial outcome of market forces.
In their eyes, regeneration transforms neighbourhoods from areas with low house prices and low demand into places with rising prices and high demand.
They don’t see it as their responsibility or the function of a free market to include a wider social mix of residents, provide genuinely affordable housing tenures or to reduce social inequality.
Regeneration lobbyists also claim planning procedure and law stalls development.
In September 2012, central government responds by pledging to extend developers’ appeal rights against Section 106 conditions – and in the years that follow seeks to loosen planning system constraints on developers.
Historically, some older regeneration schemes have provided long-term benefits for local people – such as Coin Street at Waterloo. After almost two decades, King’s Cross Central seems to offer a mixed range of homes and a publicly accessible plethora of facilities and pedestrian routes.
Both involve varying degrees of genuine collaboration with local people – avoiding the bitter legacy suffered by the 1980s redevelopment of Canary Wharf at the Isle of Dogs in east London – London’s archetypal anti-democratic, state-imposed, developer-led regeneration scheme that turned its back on a traditional working class neighbourhood.
But, elsewhere, corporate developers and affluent property speculators are seen as the ‘regeneration game’ winners.
Existing residents and traders claim they are being priced out of their traditional family neighbourhoods in developer-led regeneration hotspots like Elephant and Castle, Tottenham, and Earls Court.
Elected politicians face accusations of betraying the very people who elected them.
In some instances, regeneration schemes stand accused of ‘social engineering’, even ‘social cleansing’ – a phrase that makes invested local council leaders spit bullets about local people’s ‘ingratitude’.
Proposed schemes on other largely disused London brownfield sites do offer future hope that people on lower and average incomes might be able afford new homes in new neighbourhoods – such as Old Oak Common in west London and Meridian Water in north London.
Perhaps, though, a more hopeful sign arises in the small yet increasing number of Londoners who, not only oppose developer-led regeneration, but devise and propose their own alternative community-led neighbourhood plans.
© London Intelligence 2014