Flexible density rules needed to reap benefits of Crossrail 2

10th April 2017

Major London landowners are calling for a relaxation of current rules on the density of development in the capital to enable the property industry to help foot the bill for Crossrail 2.

A report out this week commissioned by the Westminster Property Association (WPA) and produced by JLL, titled Crossrail 2: Catalyst for Growth in Central London, argues that greater flexibility over the height of developments and residential use is necessary to fully realise the economic benefits of the proposed train line. The report, which is co-sponsored by British Land, Derwent London, Grosvenor and Land Securities, also urges central government to commit to funding its share of the project. The Greater London Authority has already agreed to raise half the necessary funding. A decision on the future of Crossrail 2 is “weeks rather than months” away, according to WPA executive director Charles Begley, and the campaign for it to go ahead is gathering momentum. This week, a coalition of more than 60 housebuilders including Berkeley Group, Taylor Wimpey, British Land and all of London’s largest housing associations wrote to the chancellor, transport secretary and communities secretary urging them to approve the project as soon as possible.

Potential benefits

Craig McWilliam, vice-chairman of WPA and chief executive of Grosvenor Britain & Ireland, says: “With public sector commitment to Crossrail 2, private capital and co-ordination would flow into central London, driving regeneration, creating new public realm and delivering new amenities. And with the access Crossrail 2 would bring to jobs and homes, the West End could viably support new enterprise.” However, the report’s author, JLL head of UK research Jon Neale, warns that “geographic, planning and ownership constraints could be a major barrier to maximising the benefits from Crossrail 2”. JLL’s analysis shows that while the total amount of office floorspace in central London has grown by 23.3% since 2001, development over the past decade has been focused on the City and in emerging markets outside the core West End, such as Paddington and the South Bank.

A visualisation of the new Crossrail trains However, the report says that the transport connectivity benefits of Crossrail 2 will mostly be felt elsewhere in an r-shaped area from Trafalgar Square to Euston, then extending east towards Angel and Old Street, making these areas most ripe for an increase in economic activity if development rules were relaxed. The line itself would run from south-west to north-east London through the centre of the capital. McWilliam says that commercial development could help local government in London fund Crossrail 2, either directly through the community infrastructure levy or indirectly through retained business rates - but that “a growth-promoting planning regime that creates and captures value” would be needed, along with “closer and more creative collaboration” between government and the real estate industry to address issues such as public realm and fragmented ownership of land. The report calls for a “new wave of placemaking” involving denser mixed-use development that would maximise private sector investment around the new rail line and help London meet half the costs of the project, a target suggested by Lord Adonis, the chair of the government’s National Infrastructure Commission.

Sensitive development 

This denser development need not mean tall towers, according to Tony Travers of the London School of Economics. “With decent planning and architecture, we can do it without ruining the look and feel of London,” he says. “London is not a particularly high-density city: it would just need to be a little bit denser here and there.” At the report’s launch, Crossrail 2 was touted as a project that could prove that London is still open for business amid Brexit negotiations. London’s deputy mayor for transport Val Shawcross says: “If we want the West End to retain its national and international competitiveness, if we want London to retain its national and international competitiveness, we’ve got to win this project.” The industry has made its case. It will find out shortly whether that case is sufficiently compelling.