The Crossrail effect: London's new commercial property hotspots

Europe’s biggest construction project holds the key to identifying the capital’s latest property hotspots, with developers flocking to previously unfashionable areas.

London’s relentless, rapid growth makes for a property market in perpetual flux where postcode snobbery gives way to postcode envy as hitherto unfashionable areas are gentrified.

Regeneration projects and expanding transport networks are creating new, unexpected property hotspots across the capital.

Demand for zone one properties has actually fallen by 20% in the last year as demand for properties further afield achieved the fastest growth in the country. Several major transport projects, including the northern line’s expansion, Crossrail and TFL’s 13 new Thames crossings, are fuelling the trend.

The biggest rises in demand are concentrated in locations close to the new Crossrail stations, which will bring 1.5 million people to within 45 minutes commuting distance of the capital.

Commercial property advisers GVA project that Crossrail could add £5.5bn to the capital’s property market by 2021.

In Crossrail: The Impact on London’s Property Market, Property Week predicts that Europe’s largest construction project will “directly drive values in the commercial and residential sectors” and act as a “catalyst for broader investment and development”, unlocking enormous value in affected areas.

PropertySales.com takes a look at some of London’s latest property hotspots below.

Nine Elms

Just south of the river, Nine Elms is one of London’s largest regeneration zones. Comprising 227 hectares of ex-industrial land, Nine Elms boasts the UK’s biggest redevelopment scheme.

More than 20,000 residential units are under construction across 6.5 million square feet of commercial space, while two new northern line tube stations are due to open in 2020, one in Nine Elms and one in nearby Battersea.

The London Report by Knight Frank identifies the riverside development as a prime zone for commercial property, particularly retail. It is “drawing tenants thanks to new infrastructure links and an ambitious mixed-use offering.”

The report also states that London firms are becoming “more footloose on location than ever before” and Nine Elms is just one of the areas benefitting from this trend.

Ravi Govindia , co-chair of the Nine Elms Vauxhall Partnership and Leader of Wandsworth Council, says: “Nine Elms is on course to become a major commercial hub over the next 10 years. Our central London riverside location has obvious appeal and the new Tube stations and wider transport package we’re delivering give us the connectivity a modern business district needs.”

Lib Peck , also co-chair of the Nine Elms Vauxhall Partnership and leader of Lambeth Council, says: “A wide range of office, retail and other commercial space and good transport links make the area very attractive to business and that’s good for us locally and London-wide. A thriving local economy helps create sustainability, which is essential for an area to grow and strengthen its identity.”

Hayes

A little further out in the borough of Hillingdon, Hayes has become the latest town benefitting from the Crossrail boom.

Nigel Cramb, partnerships and business engagement manager at Hillingdon Council, told the Financial Times that “Crossrail has been the catalyst” for a lot of interest over the last four years from developers “who’ve realised it’s not that far away.”

From 2018, 10 services will run from Hayes and Harlington station and with Paddington and Heathrow airports in close proximity, it’s quickly becoming attractive commuter territory.

The Old Vinyl Factory redevelopment is also sparking interest in the area. Once home to iconic record labels EMI and HMV, the derelict complex is undergoing a drastic transformation in the form of a £250 million mixed-use project.

The new development will provide 630 new homes, public spaces, restaurants, cafés, shops, a multi-screen cinema and a museum.

Rob Weaver, director of investments at property crowdfunding platform Property Partner, told London Loves Business: “I have high hopes for Hayes. Properties here are rising fast from a low base, with the localities also benefitting from significant regeneration.

“Hayes, which used to be largely industrial, is on its way to becoming a business and high-tech hub, clustered around the £250 million Old Vinyl Factory redevelopment, which will bring 4,000 new jobs to the area.”

Woolwich

Benefitting from the regeneration of Canary Wharf, the 2012 Olympics and, most recently, Crossrail, Woolwich has received large-scale investment in recent years. From 2018, there will be approximately 12 direct services to the West End, The City and Canary Wharf from the south-east London area.

The £1.2 billion Royal Arsenal Riverside development has generated considerable interest, along with council plans to rejuvenate run-down areas with new homes.

According to property investment consultants YPC Group, “nowhere in London is developing faster than Woolwich”.



Melanie Luff

About the author

Mel wrote for all titles in the Dynamis stable including BusinessesForSale.com, FranchiseSales.com and PropertySales.com as well as other global industry publications.

@Be_TheBoss

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