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The representatives of British Land, one of the biggest listed property investment and development firms in the UK visited Singapore during the 21st and 22 weekend in order to display the biggest master-planned plan located in Central London.
The development covers an area of 53 acres (21.4ha) located in zone 2 within Central London, the project is dubbed Canada Water, and it will help to revive an often overlooked section of docklands in the southeast of London. The master-planned development will have an asset value gross in the range of GBP474 millions ($819.3 million) at the time of September 3, 2021. It will be built in various phases over the course of the next 10 years or more.
To British Land, Canada Water is an ambitious development because of its scale, its proportion of mixed-use components and the sustainability goals the developer has set itself throughout the entire project according to Emma Cariaga, head of residential development at British Land.
If the entire project is complete when it is completed, it will provide more than 3,000 new housing units, office space for up to 20,000 people and one million square feet of new recreational, cultural, or educational facilities. The developer is also planning the area as a net-zero neighborhood (where there are no CO2 emissions net) in 2030.
“Canada Water” will be an almost 50:50 mix of commercial and residential areas. This kind of plan gives us a decent amount of risk-management across various market cycles. However, the most important thing is that it allows for footfall to be generated at various periods of the day and throughout one week, which helps maintain our leisure and retail options.” Cariaga says. Cariaga.
A decade of development Another decade of growth
British Land started the Canada Water project a decade ago, when it began to acquire and land-bank key parcels of land within the area. The project’s eventuality as a master-planned town-centre was chartered first in the year 2015.
City planners granted British Land in-principle approval at the time of the design for an urban masterplan for a new town center and the developer had the chance to begin construction on the first phase of the project in the initial phase in October, after receiving planning approvals in 2020.
In March of this year, British Land sold 50% of its stake in Canada Water to AustralianSuper, Australia’s largest profit-to-member pension fund that has more than GBP140 billion of member assets under its management. The deal was valued at GBP290 million.
This led to the formation of a joint venture 50:50 to facilitate the execution of this master planned development. This transaction boosts returns and allows funds to British Land for future development projects. Additionally, the developer also receives a fee from the joint venture for being the asset and development manager of the master-planned development.
“What is different about British Land from some UK-based residential developers is our dedication to hold our property for the long-term. For Canada Water, while we are selling the apartments but we will retain the retail, offices and leisure facilities in addition to maintaining the public spaces and the streets,” says Cariaga.
She says that this level of control allows the developer to preserve the exceptional environment that it hopes to build for Canada Water.
Historic docklands
The area that covers Canada Water was established over two centuries ago, as an area known by the Surrey Docks, which were at one time the hub of London’s timber industry and also received lumber shipments from Canada. The region is named in honor of Canada Dock, which was the name given to Canada Dock that was constructed in 1876.
This is why many of the historical structures in the region have Canadian and American style references that speak to the area’s history as a dock that was active. In the course of time several of the canals and rivers were made into green spaces and parks.
“The region is home to more than 130 acres of parks and green space right in front of Canada Water. Canada Water master plan. It’s becoming increasingly difficult to find similar development sites in London in the present day that have such a large amount of nature,” declares Cariaga.
While some of the structures in the area are expected to be converted to new commercial and residential development as part of the masterplan, British Land intends to keep and repurpose some of the more significant historic structures including the Printworks structure, which was once was the place for printing production of The Daily Mail. Daily Mail.
The structure has been converted as a venue for music in 2017 and the idea is to transform this property to a business property with a focus on aspects of circular economics like an open market with 35 stalls selling sustainable fresh produce.
The Phase 1 Showcase
The first phase of development for Canada Water is already underway and will consist of three parcels in the northern part of the master planned site.
The first lot will be used to build an unnamed, 35-storey residential tower that will house 186 homes. The ground floor podium will include 10,000 square feet of F&B and retail amenities along with 118,000 square feet of work space. The residential part will include studios and one to three-bedroom apartments.
The plot that follows is to be converted into a commercial property that will include 182,000 square feet in office spaces, 10,000 square feet of F&B and retail areas, as well as a brand new 55,000 sq feet fitness center.
Both projects are scheduled to be finished by the 3rd quarter of 2024. They will be located next to the interchange station of Canada Water London Underground and London Overground. The station is located on the Jubilee Line between Bermondsey and Canary Wharf stations, and is located on the East London line between Rotherhithe and Surrey Quay stations.
Based on Simon Capp, representing residential construction and sales for British Land, there is no similar project available in the London residential market that provides the same amenities of public transport within Zone 2.
“Purchasers nowadays are no longer seeking an apartment. They want to invest in the area in which they can reside, play, and work as well as create an atmosphere of belonging. We are determined to provide,” says Capp.
Phase One will encompass the creation of a few public areas. “We’re aware of the necessity to set the proper foundation for the rest of the development. That’s why some of the amenities we’re adding include a bridge which will connect the dock that was previously used and will also serve as the focal point of open to the community to enjoy the newly regenerated greenery and landscape,” the developer says.
In the present, British Land has not made available any of the homes in the Phase 1 phase for sale. The developer states that it’s watching sales activity while it showcases the project to foreign as well as local purchasers. The developer is planning to announce the start prices for the units of Phase 1 later in the year.
Singapore is the sole country within Asia Pacific that the developer will present its project to at the moment. However, it is planning to bring Canada Water to other Asian markets in the next year.
Interest in investment in London properties is increasing
British Land is showcasing its massive project at a moment where the demand for London properties are on the increase, according to Anthony Jurenko, international residential sales director for Apac at JLL.
“There is a degree of familiarity among the majority of Asian investors with regards to London. London residential market as compared to other cities of Europe. Additionally, London has a demonstrated track record of being a popular investment location regardless of the Covid-19 epidemic and uncertainty over Brexit,” says Jurenko.
According to research conducted by JLL according to JLL research, according to JLL research, residential property costs within Central London have gone up to 198% in the last two years. Capital value has increased by 6.8% per year over the last 30 years.
Another element that will help drive the price rise in homes in London properties is the ongoing housing shortage which has affected London over the last few years. “There is a long-term shortage that is the key in determining the price upwards of Central London properties,” Jurenko believes. Jurenko.
Its inhabitants in London was estimated at 9 million at the end of 2021 however, it is expected to increase to 9.7 million by 2031, according JLL research. But, the city isn’t constructing enough houses to support the population growth. JLL believes that London will require around 66,000 new homes to satisfy demands, however, the pipeline supply is expected to supply around 40,000. The company anticipates a shortfall for 178,000 new homes within London in the next five years.
In 1Q2022, there were GBP16.3 billion of capital investment directed towards UK real property, of which 20% (or GBP3.3 billion, was from investors within Asia Pacific. “Investment in Asia Pacific region Asia Pacific region into UK real estate is rising from the lows of 2020/2021 so far in 2022. This is largely due to purchasers coming from South Korea and Singapore as travel corridors were opened in the in the year,” Jurenko adds. Jurenko.
He anticipates that investment in Hong Kong and mainland China to increase this year, as travel restrictions are eased.
JLL reports that investing into London homes in within the Asia Pacific region predominantly goes to rental investment. Around 37% of Asia Pacific buyers who have purchased new houses within London through JLL since 2021 have bought the homes to use for personal reasons or are planning to allow the family member to reside within the property.
Jurenko claims that new developments like Canada Water are a timely infusion of housing into London and provides an possibility for homeowners and investors to gain a foothold on London real property.
