Property giant Capital and Counties (Capco) has sold the bulk of its interests in the 77-acre Earls Court regeneration project to fellow developer Delancey and its Dutch pension fund manager partner APG, following years of inaction on one of the capital’s biggest redevelopment schemes.
A figure of £425 million has been agreed for parts of the project area, primarily comprising 63 per cent of a company Capco formed with Transport for London to build on the site of the former Earls Court exhibition centre, and Capco’s financial stake in a 2012 agreement with Hammersmith & Fulham Council (H&F) to sell them two council-owned housing estates for redevelopment.
Planning consents for the Earls Court project, which envisaged a “new district for London” straddling the border of H&F, where most of the putative development area lies, and neighbouring Kensington & Chelsea, were secured from Conservative council administrations in 2012 and waved through by Boris Johnson when he was London Mayor.
Johnson hailed the scheme as “a landmark project that will deliver much needed jobs, new homes and improved infrastructure”, yet nothing has been built since the closure of the two exhibition buildings five years ago and their subsequent demolition, and the future of the housing estates has remained in the balance, with a Labour-run H&F, in power since 2014, seeking their return to its control.
A third substantial part of the development area, the TfL-owned Lillie Bridge London Underground depot, has remained untouched. Greater progress has been made on a separate site in the area, lying south of Lillie Road next to West Brompton station, built out by a partnership between Capco and what it describes as “interests of certain members of the Kwok family” (a Hong Kong property dynasty), where apartments are being marketing for between £800,000 and £2.15 million.
Capco’s long-running attempts to find a buyer for its Earls Court interest rather than build on the site has been been a source of growing frustration for TfL, which wants to derive revenue from its property portfolio to boost its under-strain budget, and for current Mayor Sadiq Khan, who said in February that his patience with Capco was “wearing thin“.
Khan had previously told On London that any new planning application by a successor developer to Capco would have to provide more new social and other affordable homes than the existing plans and also exclude the housing estates. In March, Hammersmith & Fulham leader Stephen Cowan confirmed to residents of the two estates that his administration was “willing and able” to return to Capco the money it had so far been paid under the terms of the conditional land sale agreement signed with his Tory predecessors.
Capco has seen the value of Earls Court decline steeply in recent years, partly as a result of the high end of the London property market levelling off and changes to stamp duty. The original plans envisaged 7,500 new dwellings being built, of which 760 would be replacements for the those lost on the estates and 740 would be intermediate “affordable” homes with no additional ones for social rent, representing just 11 per cent additional affordable homes.
Sadiq Khan’s policies require a minimum of 35 per cent affordable homes from new applications to avoid the possibility of his using his planning powers to demand revisions. Khan has no power to revoke existing planning consents.
Dave Hill has been covering the Earls Court Project story for ten years, including for the Guardian.
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