A proposed relaxation of planning laws could undermine the reputation of London's Square mile, as it would allow office space to be converted into homes. It's being argued that this would affect the city’s competitiveness and world-class status.
Peter Rees, city planning officer for the Corporation of London was speaking at an event organized by the British Property Federation, and says "While the government's ambition of supporting economic growth and increasing housing stocks is laudable, the cyclical nature of the property industry means that if developers were to turn offices into residential blocks when times are tough, the city's ability to attract and house new firms when market conditions improved would be seriously diminished."
Its felt these changes to the planning law could negatively impact the city's reputation as a business environment making it less attractive to firms, particularly as the laws would affect the types of offices favored by small to medium business enterprises. These are precisely the kinds of firms which give London its world-class status.
During the last budget in March, the Chancellor, George Osborne said he wanted to slash much of the red tape preventing commercial property being converted into homes, as if all unoccupied office space was converted it could create an extra 250,000 units.
Not everyone takes this negative view, as Andrew Stanford, chair of the British Property Federation residential committee said the proposed relaxation "Has come as a pleasant surprise to the residential investment sector. Coupled with the desperate need to increase housing supply, particularly in London and the south-east, the proposal is to be welcomed, albeit with caution in key areas such as the city of London."
A recent survey estimated that Britain faces a shortfall of around 750,000 homes by 2025 as new home starts are at the lowest peacetime level since 1923.