The future of industrial integration - Think Tank

Friday 30 June 2017

London is close to reaching its 2031 target for releasing industrial land for higher value uses such as housing, with 12 boroughs released the amount of industrial land expected. So the capital must embrace innovation, perhaps with multi-storey schemes that are the norm in Shanghai or Hong Kong, and recognize the role this wide-ranging sector plays in keeping London competitive on the world stage.

So said SEGRO partnerships development director Neil Impiazzi at a think tank organized to examine how London can retain and develop its crucial industrial sector, and how the London Plan might support those moves.

SEGRO has 69 million sqft of built floorspace throughout nine European countries, and importantly was a long-term investor that started in 1920 with the Slough Trading Estate, which it still owns and manages today. ‘What we’re trying to do is not just build buildings but thriving industrial locations’, said Impiazzi. SEGRO’s portfolio is as wide as the sector, from food to air freight to media, and people need to better understand the role its customers play in supporting London’s economy, said Impiazzi. But it is ‘really worrying’ that the GLA’s 2031 target for industrial land release could be met this year. So SEGRO commissioned Turley last year to provide a research report and evidence base looking at the challenges facing the sector, in order to find solutions, policy recommendations and influence the London Plan and mayor’s transport strategy.

The industry needs to innovate, said Impiazzi, and move to mixed use away from the ‘Dickensian’ view about industrial in which reports often feature a chimney on their cover – this is much more about e-commerce and modern, mixed use workspaces and homes. It was less about quantum of space, and more about quality and location. ‘We’re not saying don’t build on industrial land, but we do need to think about how to service London in the future’, he said. ‘Our customers are now looking at locations closer to central London, not further away.' 

We have reached a ‘crunch point’ where we have released too much industrial land, said Levent Kerimol, Principal Regeneration Officer, Greater London Authority, who asked how a genuine mix could be achieved without further degrading industrial areas, given planning policy can be a blunt instrument.

Strategic Planning Manager, Greater London Authority, Colin Wilson agreed planning policy tended to be ‘quite crude’, suggesting that London needs a more assertive, engaged plan, rather than a ‘passive aggressive’ one. But it also needed a better, fuller evidence base beyond measuring, realised through talking to people running the storage businesses, running logistics and so on.

Rather than excessively wordy policy, a series of sectional diagrams showing a 3D approach to intensification, the layering of industrial and other symbiotic or complimentary uses in a rich urban mix could be a better way to communicate planning documents – showing a multi layered ‘sandwich’ approach to land use said Paul Karakusevic, Partner of Karakusevic Carson Architects.

Really, though, it was the usage of policy that was blunt, said Michael Mulhern, Director of Planning, Old Oak and Park Royal Development Corporation. The professions had to be more specific and assertive about the different sectors, since data centres have specific needs compared to, say, advanced manufacturing. It had to be adaptable too, however, since the majority of the biggest businesses today didn’t exist 25 years ago.

Barking and Dagenham, said its Strategic Director for Growth and Homes, John East, is releasing 130 ha of strategic employment land, a lot of it low grade and low density. It has gone out to tender on a two-stage employment study to get a better understanding of the business base and its growth sectors to get an idea of employment floorspace requirements in the future. And although East promised that in 20 years the borough will have ‘genuine mixed use’, one of the biggest challenges would be in persuading existing end users ‘that they aren’t going to be able to have big boxes and seas of parking and work within the M25. That’s where we will have to use our powers of persuasion collectively.’

In Ealing, said Lucy Taylor, the borough’s Director of Regeneration and Planning, a lot of the industrial land is close to the borough’s five Crossrail stations, but an issue was in how to capture value early. Gensler design director Nigel Lea said his practice is working on a new typology that might help. This is an incubator for maker spaces, bringing different integrated uses onto a site, with General Projects. This will mix universities and local authorities, brand retailers with research and development facilities around sports, and will have a retail experience destination offer so it works at the weekend, forming a catalyst physically and socially in job creation.

Turley associate director Paul Keywood said it was important to change the mindset of favouring new homes over retaining much-needed employment land. Guidance from the DCLG was not as sophisticated for testing future employment land needs as it is for residential and needs to be remedied because an up-to-date, robust evidence base is critical for authorities to ensure informed decision making.

In Hamburg, said HawkinsBrown partner Darryl Chen, ‘agent of change’ legislation exists to roll out sound proofing details on residential details in industrial space, and that is already happening in London at Hackney Wick too, where mixed use developments are required to have sound proofing.  But we need to create space for dirty industries, said Detlev Munster, head of property programmes at LB Enfield. The property industry should be about recognising that there are different typologies out there that we should be looking at, despite some resistance from property agents on what London needs.

Agent Adam Cradick, senior director of CBRE suggested that there does need to be a cultural shift – possibly there was an answer on Green Belt release – but you can’t get away from the reality of the need for intensifying uses on small sites. The change of culture needs to come from the investor side too, he suggested; one project to redevelop a bus depot site with residential Cradick worked on fell through when mortgage lenders wouldn’t lend when they discovered there had to be a small fuel tank retained in the depot.

It was the public sector that Paul Karakusvic felt sorry for, for always being 15 years behind, and with landowners benefiting from the lag. ‘Watching Crossrail 1, I hope the lawyers have locked in fantastic Section 106 deals around the fantastic infrastructure TfL have put in, but I suspect they haven’t’, he said. ‘What I do hope with Crossrail 2 that, given it’s 16 years away, before the route gets finalised, before the stations get absolutely locked in, the public sector go to all of those landowners and say “You’ve got a fantastic factory, but you will not get a shiny tower with 220 flats in and a café on the corner and a barber’s shop. We will work with you on a fantastic mixed use proposal, or we’ll CPO you”…. If the public sector doesn’t start banging the table a little bit we will have a bigger crisis on industrial land; it really needs massive intervention.’

The Think Tank also heard from Founding Partner of Makerversity Paul Smyth, who said his small start-up members really want a strategy aimed at them too, and perhaps a ‘neighbourhood warehouse’ typology, while Christian Spencer-Davies, Managing Director, AMODELS and Camley Street Neighbourhood Forum, said it was possible to develop through a community land trust, adding homes to maintain existing industrial culture and rents to remain in perpetuity.

Faaiza Lalji, Director, Planning and Development, Precis Management Services, said her firm’s brand of self-storage has developed, adding offices and, it hopes, residential, with pilot sites in Merton, Lambeth and Hounslow. This is a direct corollary of flats getting smaller and residents not having enough storage space, said Chen, and is set for ‘massive growth’. In the US it is getting so popular that it is displacing traditional industrial uses on industrial land, so much so that city authorities are having to legislate to regulate that growth.

Ultimately, though, said Matthew Foulls, Head of Estate Regeneration at Peabody, there could be ‘carrots’ as well as ‘sticks’, such as subsidies, grants or tax incentives. But the reach needs to be wider, especially with places like Thamesmead and its 2 million sq ft of commercial floorspace getting to the point where redevelopment could be on the cards. ‘We need to bring new people and ideas into this conversation if it is to work’, he said.

David Taylor

Editor, New London Quarterly 

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