Boris Johnson has confirmed that work is to start on one of the biggest long-term rental developments in London at Newington Butts in Elephant & Castle.
With Canadian residential and hospitality owner operators Realstar and developers Mace on board, the site owned by the Greater London Authority will be transformed into 457 high quality new homes when construction begins in January 2015. This includes 278 homes for private rent, as well as 179 low cost homes for rent and shared ownership, being delivered by social housing provider Peabody. The scheme is set to be completed by 2018.
In the last ten years the number of households renting in the capital has leapt to around two million. Nonetheless, London currently has few purpose built rented schemes in comparison to North America and the rest of Europe. The Newington Butts site, located in zone 1, was part of 670 hectares of spare public land taken on by the Mayor in 2012. Of this, more than 85% has now been moved into the development pipeline.
In his housing strategy, the Mayor set out a number of policies to encourage institutional investors into the long-term rented market to support longer term leases and more stability for tenants as well as top quality, well-designed, new developments.
Johnson announced in September that two further Greater London Authority owned sites, Silvertown Way in Canning Town and Pontoon Dock in Newham were being brought forward for institutionally backed private rented sector homes.
“With London's unprecedented population growth, housing supply and affordability is now our biggest challenge and we need to double the number of homes being built,” Johnson said. “This requires a radical rethink and it is time for new approaches like this, which not only help build more homes in the heart of the city, but also improve choice and quality for Londoners.”
He added: “Capitalising on London's undeveloped public land I want to entice more institutional investors to come forward and invest in quality homes for Londoners, boosting the economy and creating thousands of new jobs.”
Ryan Prince, Vice Chairman of Realstar Group International, also commented: “Renting is changing for the better in London and this is the latest example of the development of high quality privately rented accommodation in a landmark, central location.”
“This tower property, which will form part of the wider regeneration of Elephant and Castle, will help to meet the growing demand for this type of accommodation in the capital and become a central part of our growing portfolio of high quality rented property in some of London's most sought-after areas.”
Currently, the Mayor and Southwark Council are overseeing a £3 billion makeover of the Elephant & Castle area, which will see around 5,000 new homes delivered, 1650 of them affordable. The plans will create about 5,000 new jobs, as well as including an overhaul of the transport interchange and the construction of more open spaces.
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