LCR’s Olympic housing ball starts rolling

London & Continental Railways and East Thames Group have lodged plans that are significant for the east London Olympic zone and its regenerative aspirations for a number of reasons.
Firstly, the partners will shortly seek a development partner for Chobham Farm, a 1,000-home “family neighbourhood” close to the Olympic Park in Stratford, east London. That could be crucial as any partner will be aware that there will be opportunities to tie up on further strategic sites with LCR in the area and elsewhere around the country.
As I have written before – and go on to explain below- LCR could be sold as a propco with a large portfolio of transport hub sites across the UK within the next three years. What price Lend Lease taking an interest in this opportunity given its stated aspirations to build its position as a major UK housebuilder?
The site is also key as it is seen as gateway integrating Stratford old town centre and the 6,800 home Olympic Park. Any way here are the details:
The proposals have been lodged with the Olympic Delivery Authority and are separate to the five consented neighbourhoods including 6,800 homes that the London Legacy Development Corporation is bringing forward at the Olympic Park over the next 20 years.

The Pollard Thomas Edwards-designed plans, lodged in an area located to the west of Leyton Road and to the east of the Olympic Village and Westfield Stratford City, comprise 1,000 homes, many of which are for families, together with parks and squares.

CoStar News revealed in September of last year that LCR was in discussions with Newham council and East Thames Housing to form a joint venture to pool together 15 acres of jointly owned land adjacent to Westfield’s Stratford City at Chobham Farm North for a major residential mixed-use scheme.

LRC owns the freehold to around 9.4 acres that the Olympic Delivery Authority currently holds on a short-term lease which ends in 2013.

The jv partners appointed architect PTEA Architects and Knight Frank to help draw up plans for a scheme that proposed up to 1,200 principally family homes as well as shops and a new park.

The duo will seek a development partner as and when consent is granted.

LCR also has a similar arrangement with the Olympic Delivery Authority on two other significant development opportunities in the area – the 4.6-acre Chobham South site, which is earmarked in the Stratford Metropolitan Masterplan for 1,200 homes and the two acre Angel Lane site which has outline consent for 270 homes. Australian shopping centre giant Westfield has a development option on these sites which it is still to decide on taking up.

CoStar also revealed that the government was considering adding a raft of UK transport hub sites to London & Continental Railways’ multi-billion-pound real estate portfolio as it builds a major property company for potential sale in the next three years.

LCR is 100% owned by the Department of Transport.

Following a two-stage public consultation a number of changes have been made to the Chobham Farm scheme ahead of submission, including:

• An increase in the proportion of family homes and the number of homes with their own roof terrace overlooking the park.

• New public streets linking the park and the bridges to the East Village to create alternative routes and make connections to Leyton Road.

• Better views of the new parks from Leyton Road, improving the appearance of the new street corners and addressing safety concerns.

• The addition of innovative and flexible business units at the northern end of the Masterplan, as well as potential space for creative industries.

Newham’s Stratford Metropolitan Masterplan proposes that Chobham Farm will integrate existing residents of Stratford New Town and the future communities within the new Olympic neighbourhoods.

Geoff Pearce, East Thames director of development and asset management, said:

“We are delighted with the final plans for Chobham Farm and are looking forward to building new homes, parks and facilities. The homes will be built to a high standard, offering families a great lifestyle.

“The area has already been transformed by the adjacent East Village and Olympic Park, and this development will further enhance this neighbourhood.”

David Joy, chief executive at London & Continental Railways, said: “We were pleased with the feedback we received at the public exhibitions and have taken this on board when finalising the plans. The final scheme will create a vibrant family neighbourhood that meets the targets we set ourselves at the start of the project. We look forward to continuing our work with the local people to make sure that Chobham Farm becomes a thriving community.”

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Rooff wins crucial Olympics compensation battle

It’s been a long time coming, but Rooff has won government support for its stance over the value of land in Carpenter Estates that was compulsory purchased to make way for the Olympic Park.

This could mean the Greater London Authority essentially having to shell out a whole lot more for the land it acquired to make way for the 2012 Games. That’s been an interesting debate for some time. Surely, the GLA and Newham will not appeal this latest decision and we will at last find out.

Any way here is my version of events.

Landowner wins crucial Olympics CPO compensation battle

By Paul Norman – Friday, September 28, 2012 13:15

The government has backed a landowner in a crucial legal case, opening the door to a substantial increase in the compensation bill it will need to pay businesses relocated to make way for the 2012 Olympics Games.

 

The Secretary of State for Communities and Local Government has backed building contractor Rooff’s appeal against a Newham council planning certificate in a move which effectively means the London Development Agency has been seeking to significantly underpay for Rooff’s land at Carpenter’s Estate in Stratford, east London.

The decision follows a four-year battle by Rooff to have its site valued as a potentially highly lucrative residential development opportunity close to the Olympics Park, rather than an industrial development opportunity.

A Newham council certificate had ruled that planning permission would only have been awarded on the site for B1 (business) and B2 (general industrial). The certificate was the basis for the values the London Development Agency sought to attach to the land when compulsory purchasing it to make way for the 2012 Olympic Park.

Rooff has argued over several appeals and inquiries however that because of the regeneration being brought about by the development of the 500-acre Olympic Park its land is instead suitable for a lucrative “landmark” development of mixed residential and business uses, as a key part of the regeneration of the area that is taking place in the area.

Rooff has sought a Section 17 award for residential development.

Following a four-day public inquiry in May, the Secretary of State this week backed Inspector Wendy McKay’s report which recommends the appeal be allowed and that the certificate issued by Newham be cancelled and a new “positive” certificate be awarded for a higher value mixed-use development incorporating residential and commercial.

The decision overturns a government decision made after a July 2009 public inquiry which rejected Rooff’s appeal initial appeal under the Land Compensation Act 1961.

The secretary of state then backed the inspector’s report that found that when the compulsory purchase order was launched on 16 November 2005, the only alternative development use for which planning consent would have been granted was B1 (business) and B2 (general industrial).

Rooff went to the High Court over this decision claiming the inspector’s reasoning was “unintelligible”, “inadequate” and gave rise to a “substantial doubt as to whether the inspector erred in law in many respects”.

At the High Court Rooff’s challenge was rejected by Mr Justice Blake who found that while the inspector’s report lacked the sufficient clarity, it could not be challenged as irrational, illogical or insufficiently reasoned.

In 2010 Rooff appealed claiming that the judge erred in failing to quash the decision after coming to a finding that the inspector’s reasoning was not sufficiently clear.

Rooff said the inspector’s reasoning was “elliptical”.

In April 2011, Lord Justice Carnwath backed Rooff and agreed that the argument should go back to the Secretary of State to decide whether to reconsider the entire case, potentially leading to a further enquiry.

A number of other significant landowners has been waiting to see what the outcome of the case is. It is likely that Newham will now accept that other sites coming forward in the area now should receive a Section 17 award enabling resi development, leading to a likely substantial increase in the government compensation for sites compulsory purchased to make way for the Games.

The decision was forwarded on 21 September to Eversheds acting on behalf of the Greater London Authority and Newham council.

Trowers & Hamlin advises Rooff. Savills advises Rooff on Compulsory Purchase Order matters.

pnorman@costar.co.uk

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Is Lend Lease regretting not biting the bullet at Olympic Village?

While the dust has been settling on the 2012 London Olympics a few interesting property related stories are emerging, two of which are inter-related I think – Lend Lease’s commitment to building a London resi business to match Berkeley Homes’ and Delancey and Qatari Diar’s early stage talks on the potential for a 50-storey residential tower at the 2012 Olympics site as part of their plans to assemble a major private rented focused development that could be spun into the UK’s first residential REIT.

 

First Lend Lease. There has been some fanfare around the company’s public announcement a week or so ago that it was going to build a major London resi business completing around 1,000 homes a year under its own brand by 2017 and selling new homes in London directly to the general public for the first time.

Now, I know this has been welcomed in a market that needs competition among committed, well-respected housebuilders. But I also know I am not alone in feeling that it could have been all so different for Lend Lease, if like its Australian counterpart Westfield, it had decided to take the pain a few years ago and dig deep to invest its own equity in the Olympics site.

Back in 2009 it was of course in position to become the equity developer of the 2012 Athletes Village but the collapse of  bank lending following the global downturn meant the rates it could secure to push on with the deal had reached a point where Lend Lease and the government were unable to see eye to eye on a figure that both felt was fair for the developer and the tax paying public alike.

And so those talks collapsed and Lend Lease did the job on a project manager basis.

Which brings me to Delancey and Qatari Diar. It has been suggested to me that the £557m QDD paid for the Athlete Village and six surrounding plots last year is not a million miles away from the price Lend Lease would have paid. What is more QDD is talking of doing all of the things with the site that Lend Lease was thinking of doing under the helm of Nigel Hugill and Robin Butler. That is building a major London private rented residential business that could be spun into a REIT.

There will be all sorts of reasons why Lend Lease did not feel able to proceed back in 2009. But they would be sitting on what they are now saying they would like to build if they had of done.

And on to QDD, the joint venture partnership between Delancey and Qatari Diar Real Estate Development Company, which will take control of the first circa 700 homes of the 1,439 private homes it has bought at the 2012 Athletes Village in the summer of next year.

I had no idea of just the level of gold they have picked up until speaking to Stuart Corbyn of the partnership this week. The extra plots they have include consent for a 50-storey resi tower – apart from the “mutant trombone” Orbit, the tallest building on the entire site. Here is my story from yesterday.

Handover of the homes at the rebranded East Village will follow the Olympic Delivery Authority’s circa 12-month retrofit programme. QDD expects to take control of all of the homes it has bought to be ready for occupancy in 2014.

The homes are spread across 11 residential plots and are interspersed with the 1,379 affordable homes being brought to market by the Triathlon Homes consortium.

QDD will bring forward the homes in staggered phases with at least three quarters and potentially all of the houses sold for rent. Homes range from one bedroom apartments to four bedroom townhouses. Pricing is yet to be agreed.

Delancey and Qatari Diar completed a deal to invest around £557m for the purchase and long-term management of the Olympic Village in August of last year.

Stuart Corbyn, chairman of the Qatari Diar Delancey Athletes Village Operations (QDD), said the scale of the East Village site and the agreement with Triathlon Homes to provide a long-term landlord and management set up which will manage the properties on-site and maintain facilities, meant there was an opportunity to create a major private rented focused company that institutional investors would be comfortable with.

“So much has been said over the years about building institutional investor interest in the private rented sector in the UK but they have not got into it yet. Because of the scale here with at least 1,000 units to let privately we have an ideal opportunity.

“Alongside our partner Qatari Diar we have already invested £557m and our part of the joint venture has been backed by investors. This means it will be a large private rented company that could potentially become a REIT.”

Corbyn confirmed that the partners were already talking to advisers about the potential make-up of a further six sites it owns next to the village with outline consent for as many as 2,000 homes.

One site immediately to the north east of Stratford International station has outline consent to potentially house a 50-storey residential tower Corbyn said. The tower would lie immediately opposite Manhattan Loft Corporation and London & Regional’s plans for a luxury 42-storey hotel and flats development.

Sir Adrian Montague’s government-backed review into the private rented housing market in the UK will be published later this week and will make a series of recommendations aimed at removing the barriers that are felt to be holding back institutional investment in the sector.

So far in the UK investors have only used the tax efficient REIT structure to invest in commercial property.

Residential properties usually generate lower profits than commercial because of higher maintenance and turnover costs and tend to be more highly leveraged, thus paying more in interest, and both factors have hampered the creation of a UK residential REIT.

Corbyn says the long-term management team that will be in place at East Village and the scale of investment created by having at least 1,000 homes immediately included would help to overcome some of these issues.

pnorman@costar.co.uk

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After the Goldrush

If the clamour to buy tickets for the London 2012 Games is replicated by investors and occupiers moving into east London than the area is set for a new property goldrush. CoStar News catches up with some of the key figures involved to look at what needs to happen next if a great Games for sports fans is to prove a great Games for the regeneration of east London.

 

The problem with writing about the “legacy”, or the regenerative success of the London 2012 Games, is we are in some respects 20 years away from an answer. The host Boroughs have set out a plan of “convergence” as being the main legacy of the Games – a plan for east London to reach average London living standards by 2030.

It is clear the past two weeks provided a wonderful showcase of what is being promoted for one of the UK’s poorest regions. Westfield for instance says it saw a staggering 400,000 people a day visiting its Stratford City shopping centre throughout the two weeks.

But it will be several years before we can see whether “convergence” has occurred or can be definitive about how much of the £10bn public sector bill has been repaid or to work out if the investment in Stratford and Hackney has created truly successful residential and business locations.

John Burton, director of development at Westfield, the Australian developer that ploughed private investment into the shopping centre and transport infrastructure that leads into the Olympic Park as the global downturn raged, is feeling unsurprisingly chipper this morning about his company’s ability to fill up the remaining 1m sq ft of offices and 1200 homes it has consented at the site.

“The Games were fantastic for us. We managed to cement our centre’s reputation and it helped to give so many people a taste of the new Stratford and east London. There were many days that there were 400,000 plus people coming to Stratford City. At the end of the month we will see how that translated into sales and get full figures back but food, sports goods and fashion all seem to have performed very well. The next two weeks there will be a bit of a lull but then I think many will turn out for the Paralympic Games and then we are heading into good old Xmas. The bottom line is people are now convinced of the legacy of the Games and its ability to involve both private and public investment.”

Baroness Ford, the outgoing chair of the London Legacy Development Corporation, says of major significance for Stratford is proof that it is not on the “dark side of the moon”.

“It has been really useful for people to see how welcoming and easy to get to this part of London is – really just a hop, skip and a jump for central London. In terms of convergence it really has given the area a fantastic chance to do just that.”

Gavin Poole, chief executive officer at iCITY, the preferred bidder for the key job creator in the area, the International Press and Broadcast centre, says the group’s recent selection with Delancey to take on the centre in combination with the Olympics has prompted “overwhelming demand” from investors and occupiers interested in the proposition.

“We see convergence as a vital part of our business plan. There has been some negativity today about the regeneration taking decades. I say that is great. What we are creating will benefit local kids of seven and eight now. We want to work with local schools, Olympic sponsors and businesses to provide a real apparatus for young and old people in the area to have access to new sectors of work. If a young person in Hackney for insance is really interested in the film industry it is really hard to break into. But we will be bringing that industry to their doorstep and looking to harness the energy of local people in the area.”

Matthew Black, head of the east London business at CBRE, a long-term adviser at both the London Development Agency and CBRE on the assembly and design of the park, says that key now is to “keep the energy going and the focus”.

Black jokes that it is too early to tell whether occupier and investor enquiries will pick up as everyone has just been “focused on getting tickets”.

But he adds: “The first two weeks have repositioned this part of London and it is vital now we continue to associate the area with success. People have got over from the West End and seen how easy it is to get there and how quick and accessible and we should be able to build from this.”

So what are the major challenges?

Housing

Housing and how it comes forward will be key.

Latest research from CBRE about rental growth is particularly positive for investors. Newham has shown the largest increase in average rents across all London boroughs over the last year, CBRE reported today. Average rents in Newham rose by 39% to nearly 1,700 per month. The borough came ahead of the City of London, which recorded strong growth of nearly 32%, partly reflecting a small number of exclusive new penthouses, which raised the overall average.

But are the ordinary folk of Stratford going to be priced out of the area as it becomes a commuter belt enclave for the wealthy to commute into the West End and Canary Wharf?

Jackie Sadek, chief executive at UKRegeneration, thinks that is relatively likely given a lack of genuine central government interest in creating an area that the rest of east London can benefit from.

“I think that quietly the aspirations may be re-evaluated. For Robin Wales and Newham and the London Legacy Development Corporation it may be that if the end result is a few more wealthy people moving into the area than there previously was that won’t be too bad a result. The problem is I think the Olympics halo has really confused this issue. My family in Scotland for instance is under the impression that the whole of East London has now been regenerated and this is really not the case.”

Sadek expects the Legacy Corporation to seek some early wins on discretionary sites as it looks to unlock more than 6,000 principally family houses where it will look for pioneering schemes. Then it will take stock and revisit the masterplan and look at other solutions where initial aspirations have not been met.

CBRE’s Black says it is crucial that the first phase the Legacy Development Corporation housing is “delivered well and not as if you are on a building site”.

Significantly each of the current housing schemes are hoping to complete schemes that take a pioneering approach to varying degrees.

The first wave off affordable housing at the site will be available at the Athletes Village once retrofitting has been completed.

Triathlon, the group comprising First Base, Southern Housing and East Thames Group, that will manage and sell the 1,379 affordable houses at the Olympic Village post Games is aiming to make a success of this key element by following a central premise that it can build and deliver affordable housing for investors in a more efficient and therefore better value way than pure public sector landowners can.

It aims to use techniques employed by commercial property landlords around design and procurement to make the build more efficient.

An example First Base chief Elliot Lipton uses is that lorries never leave its sites empty and always arrive full, saving on huge logistics wastages seen elsewhere.

The Triathlon partnership is investing £268.7m in the village, via a £110m grant from the Homes and Communities Agency and a £63.5m loan from Barclays and £95.2m from the European Investment Bank.

Lipton is promising to return £1.50 for every £1 in HCA grant. He says the structure of the transaction with HCA is an example of a public sector grant being used by the private sector to enable the affordable housing sector to make the little money there now is go a lot further.

The partners behind the private element of the Olympic Village are also alongside the BPF currently opposing Newham’s plans to include the village within plans for borough-wide licensing schemes for the private rented sector as it would “send a negative message” to the nascent institutional market for private rented development which it is targeting.

Current plans are to rent all of the properties to form part of the first UK private residential investment fund. That alone would be a significant legacy for the area in terms of the wider UK housing market.

Venues

Stadium

Undoubtedly, the major challenge remains finding a vibrant lasting use for the Olympic Stadium. The failure to secure a permanent tenant for the £486m Olympic Stadium so far has raised concerns that the park’s centrepiece will become a white elephant to match those at Athens for instance.

Efforts to combine a premiership football club anchor with a commitment to keeping athletics at its core and in particular a running track have proved particularly difficult to match up. Mayor Boris Johnson has taken the venue into public ownership and it will host the 2015 IAAF World Championships .The Legacy Corporation has also confirmed bids from West Ham United, Intelligent Transport Services in association with Formula One, UCFB College of Football Business and Leyton Orient have been received which are being assessed. West Ham is still the most likely tenant.

Baroness Ford agrees it remains the major issue that needs to be resolved.

“Now that this has been turned into a truly iconic venue by the Games, irrespective of the other issues it is vital that we get the tenants for this over the line. There is no reason why football and athletics cannot work together. A great bunch of uses are lined up and what we really need to ensure is that this iconic venue is not used just for a few weeks in the year.”

Westfield’s Burton says: “The investment we put up has helped to convince others to invest. The village is a known quantity. The velo and aquatics and handball all have owners that need to just put together their plans. The media centre looks like a good strong proposal but they are still working out final terms. The remaining challenge is certainly to get on top of what happens with the stadium. We need quickly to access the park and the orbit so people can continue to see this as a great new part of London.”

International Broadcast and Press Centre

iCITY backed by Delancey was recently picked to take on the key job creator in Hackney post Games. It plans to create a leading centre for technology, design and research with the potential to generate more than 4,000 jobs. The digital hub would harness innovation and creativity in east London.

The iCITY vision also has a community focus including a conference centre and a pedestrian square for broadcasting major sporting events, along with cafes, restaurants and bars.

Importantly, the Legacy Corporation has set iCITY what it describes as “tough but achievable requirements that must be met before any agreement for lease is formally signed”.

iCITY now has several months to submit “credible business plans to show it can deliver the Legacy Corporation’s aspirations for the Press and Broadcast Centre site”.

Gavin Poole at iCITY, says the centre is already 47% prelet including to a well-known film studio. However, there will be a continued feeling that the new Legacy Corporation chiefs and mayor Boris Johnson could, as UKRegeneration’s chief Sadek suggests, decide instead that they would be better off taking down the structure and creating another residential site.

“The original design was scaled back until it is little more than an aircraft hangar, so it could be done,” says Sadek.

Baroness Ford says the Legacy company is “really chuffed” with the tenant picked. “I was always clear that this was the most difficult venue post the Games in terms of the location and its scale and it is great that we have an occupier that is going to do what everybody always wanted at the location.”

iCITY’s Poole says the consortium is pressing on full steam ahead now with design work for the press and broadcast centre.

“We expect to complete the lease agreement with the Legacy Corporation by the beginning of next year. Then we should have the press centre, which offers prime office space, ready at least by the back end of 2013 for occupation although we would hope to get it ready before hand. The broadcast centre will follow about seven to eight months later.

“We plan to work hard with local people to encourage them to see the centre, its business incubator units and its businesses as a place to start their own enterprises or to work.”

Olympic Park

The 500-acre park site will reopen in summer 2013 as the Queen Elizabeth Olympic Park.

Baroness Ford says securing consent immediately prior to the Games for the £3bn project including 7,000 homes, a university, commercial hubs, a children’s playground and sporting facilities is where the Legacy company has “really medalled”.

“Andy Altman [outgoing chief executive] and I were really chuffed at securing the consent.”

Aquatic Centre

Zaha Hadid’s will be operated by Greenwich Leisure Limited – a charitable social enterprise – providing facilities for community and schools as well as elite athletes, replacing the Crystal Palace National Sports Centre.

Basketball Arena

Plans to move temporary structure to Rio for their Games and have ended.

Copper Box

Home to handball and pentathlon events, and goalball in the Paralympics, the 7,000 seat stadium will become a multi-sport arena, fitness club and home to basketball side the London Lions.

What now?

It is clear that those with the regeneration of east London at heart should be heartened by the unparalleled leg-up provided by the greatest show on earth, but the complex question of ensuring that the standard of living in this poverty stricken part of the country improves will require continued government and private sector commitment and a lot of Mo Farrah’s now legendary “graft and hard work”.

Westfield’s Burton is confident: “People perhaps underestimated the government vision in investing in infrastructure to enable development which removed one of the major obstacles. It has opened the doors if people wish to pursue it.”

Baroness Ford says that as important as the physical legacy is likely to be the harder to measure softer legacy or what she terms the “spiritual legacy”.

“The convergence is also about improving education, belief and a whole host of softer legacies. It what Jessica Ennis, Mo Farrah and Nicola Adams achieved proves to people that they can improve their lives no matter where they come from than the Games will have done a fantastic job.”

pnorman@costar.co.uk

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Taylor Wimpey/L&Q passed key Olympics housing baton

Given all the hullabaloo surrounding the selection of anchors for both the Olympic press and broadcast centre and the Olympic Stadium, it is easy to forget that another important decision was made at Tuesday’s Board meeting of the London Legacy Development Corporation.
I can reveal that Taylor Wimpey and London & Quadrant have been picked to build the first 800 homes at east London’s Olympic Park outside of the Athletes Village. It’s clearly a great and exciting win for the partners. But it’s a significant one for east London too. Their development will set the template for the Olympic Park housing and hopefully set in motion residential development that brings true regenerative benefits to the area from the Games. Here is the news story I have published on this.

The London Legacy Development Corporation is understood to have selected the housebuilder partners for the Chobham Manor scheme located between the Athletes’ Village and the VeloPark at its Tuesday Board meeting. The scheme will comprise 800 homes with 70% set aside for family housing.

Taylor Wimpey and L&Q were shortlisted alongside East Thames with Countryside Properties and Barratt Homes with Le Frak Organisation

Those bidders were chosen following proposals from six bidders who were longlisted in December of last year.

It is understood that Taylor Wimpey and London & Quadrant will be officially named once the tendering process completes next week so that work can begin as soon as the Games finish in order for the first homes to be ready at the end of 2014.

The partners were selected at the same meeting that the Mayor of London and the London Legacy Development Corporation finally confirmed iCITY as the sole preferred bidder status to become the long-term tenant of the Olympic media centre.

The Legacy Corporation also confirmed bids from West Ham United, Intelligent Transport Services in association with Formula One, UCFB College of Football Business and Leyton Orient had been received to occupy the Olympic Stadium post Games.

Chobham Manor will offer a mix of terraced housing, mews housing and duplex apartments within tree lined avenues, streets and open squares. It will sit adjacent to the Athletes’ Village which will be converted into 2,800 flats after the 2012 Games.

Around 30% of the homes will be affordable housing with local people targeted through local authorities and housing associations.

A Community Land Trust could be part of the affordable housing offer giving a non-profit community-based organisation the opportunity to provide permanently affordable homes for long-term community benefit.

Families in the new homes and surrounding communities will be supported by a walk-in health centre, two nurseries, two multi-purpose community spaces, neighbourhood shops and the nearby Chobham Academy school.

In total, the Legacy Company is aiming for up to 35% affordable housing across the 500-acre Park – in line with the Mayor’s London Plan.

Chobham Manor is one of five neighbourhoods to be developed on the Queen Elizabeth Olympic Park, with up to 8,000 new homes being built over the next 20 years, in addition to East Village.

The six bidders that were longlisted in December were: East Thames and Countryside Properties; Barratt Homes and Le Frak Organisation; St James Group Limited (Berkeley); Swan Housing Association, Urban Splash, Yoo & Mace; Notting Hill Housing, United Housing and HTA; Taylor Wimpey and London & Quadrant.

The London Legacy Development Corporation declined to comment.

pnorman@costar.co.uk

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Westfield signs new office tenant in Stratford and says area is emerging as business destination

Westfield has signed another tenant for the first 128,000 sq ft office complex at its Stratford City development in east London I can reveal as it says the 2012 Olympics site is now emerging as a key business destination in the capital.

In what will be seen as further evidence of London’s economic shift eastwards, facilities management firm Spotless International Services is to move its UK headquarters from Uxbridge in west London to Westfield’s One Stratford Place office development.

Spotless has taken 11,000 sq ft on the eighth floor of the building on a new 10-year lease and will join existing occupiers Coral and London Legacy Development Corporation at the scheme. Rents at the scheme are around £35 per sq ft.

Westfield said it is seeing strong interest for both the remaining circa 50,000 sq ft space in One Stratford Place and the adjacent prelet opportunities for close to 1m sq ft more of offices.

The London Legacy Development Corporation took a 10-year lease in March on 21,000 sq ft at One Stratford Place while Coral Bookmaker took 30,793 sq ft of offices at the end of last year.

Team GB has already signed a short-term lease on the eighth floor at the building for the duration of the Games.

The 10-storey One Stratford Place is the first phase of offices to be delivered at Westfield Stratford City.

Post-games, Westfield plans to deliver a further 1m sq ft of offices in three phases.

The building is located at the end of the pedestrian footbridge which leads into the Olympic Park and commands views across the entire Olympic site, the City of London and Canary Wharf. It includes 21,000 sq ft floor plates.

Craig Lovett, UK chief executive and managing director of Spotless International services, said at the lease signing: “The search for a new HQ inevitably focuses on factors such as people comforts, communications and transport links, quality of space and the sort of business community on offer. One Stratford Place scores highly in each of these areas, with Westfield providing the foundations for a new and genuine business district for London.

“Our recent recruitment drive for our significant London Olympic Games involvement has seen us successfully attract over 40% of our total workforce from within the Stratford environs. We look forward to developing close ties with the local community, as well as continuing our business relationship with Westfield group.

“Moving from one side of the capital to the other is clearly not a decision to take lightly, but the quality of the offer in Stratford makes this the best location from which to grow Spotless’ facilities management business in the UK.”

John Burton, director of Westfield Stratford City, said: “With One Stratford Place now letting up to a variety of occupiers, there is real momentum behind the offices and we are seeing first-hand the emergence of Stratford as a business destination.

“Potential occupiers are increasingly aware of the advantages that Stratford holds and we are seeing strong interest for both the remaining space in One Stratford Place and the adjacent pre-let opportunities.”

Westfield Stratford City will form the gateway to the 2012 Olympic Games and already offers over 300 retail brands, anchored by John Lewis and Marks & Spencer, and around 50 places to dine alongside leisure facilities including 1a 4-screen cinema, bowling alley, casino and hotels.

CBRE and Cushman & Wakefield advised Westfield.

 

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Is the Olympics masterplan the last hurrah for Altman and Ford’s family vision for east London?

Andrew Altman, the outgoing chief executive of the London Legacy Development Corporation, will no doubt be feeling personally vindicated today.

The US regeneration and masterplanning expert and former deputy mayor of Philadelphia,  last night saw his plans for the redevelopment of the Queen Elizabeth Olympic Park in Stratford after the 2012 Games rubberstamped by the Corporation’s old sparring partner the Olympic Delivery Authority.

It was never in doubt you might think. Sources close to the Development Corporation however suggest there was some concern that the ODA may defer the decision until after the Games and Altman’s impending departure and who knows what would have happened then?

At present there is a clear changing of the guard at the Corporation as Mayor Boris Johnson stamps his personality on the vehicle which he took full control of in April. Altman’s departure, announced earlier this month, followed relatively soon on from that of chair Baroness Ford.

Dave Hill of the Guardian has written interestingly on the possible reasons for all of this here.

My sense is that Hill is right that things might have been different for Altman if the sale of the Olympic Stadium had run more smoothly. Successful politicians tend to be good at locating fall guys for high-profile embarrassments and it isn’t hard to see a scenario where the blame for the delay in locating an anchor for the biggest potential white element at the Park shifts to the likes of Ford and Altman while Johnson and his new chair Daniel Moylan and incoming chief executive are able to do the finger pointing.

It would also clearly be odd if, as is increasingly likely, Altman and Ford are gone before an anchor tenant for the other key venue – the International Broadcast and Press Centre  – is chosen. The Corporation says the process is still running to plan and a decision between the two remaining bidders – the iCity and the UK Fashion hub – is imminent. But stories like this one in the Financial Times last week suggesting that the new brooms are taking a serious look again at the whole process does at least raise doubts about the Corporation’s current liking for its two shortlisted bidders

Putting cynicism to one side, however, perhaps Altman, whose skills after all were always seen to lie principally in masterplanning, feels he has done what he set out to do.

The biggest impact Altman and Ford have had on the plans for the park were clearly the ideological shift away from high-rise commuter belt development towards the creation of a family neighbourhood.

The original masterplan for the Olympic Park, drawn up by architects EDAW, KCAP and Allies & Morrison in 2008-2009 for the London Development Agency, envisaged between 10,000 and 12,000 homes in six village developments at the park – just one of which would provide low-rise family homes.

Ford and Altman revised the plans to propose 8,000 principally family houses in lower-density neighbourhoods.

This has subsequently been scaled back to 6,800 homes and at last this has been formally rubberstamped.

The masterplan’s focus on trying to create a community that appeals to families has in fact been almost universally endorsed, particularly by Johnson who continues to describe the project as London’s “most important” regeneration scheme.

For Stratford it is to be hoped that the shift in power at the Legacy Corporation does not also enable the Body to shift away from this aspect of the proposals.

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