Redeveloping unused or empty commercial land and buildings in London could provide up to 420,000 additional homes for rent by 2036, according to a leading think tank.
Research from the Policy Exchange found that there are more than 500 hectares of empty or under utilised industrial land in the capital alone – the equivalent of 750 football pitches – as well as a huge amount of neglected retail space in outer London.
Redevelopment of Empty London Buildings Could Provide 420,000 Homes for Rent, Says Think Tank
The think tank’s report states that if the Government were to commit £3.1 billion per year to finance the purchase of this land, alongside a private sector partner, such as an institutional investor, about 21,000 homes could be built every year.
The Policy Exchange suggests that the homes should be designed to accommodate the ever-expanding private rental sector and shared ownership market by using pre-fabricated materials, which will overcome skills shortages in the construction industry and other factors that slowdown house building, such as bad weather conditions.
Rental income from the homes and the sale of equity stakes could recover the Government’s money within 20 years, says the think tank.
If a scheme like this went ahead, it would be the largest Government investment and delivery on housing since the 1970s.
The report adds that the process of buying non-residential land could be sped up by giving extra powers to the Mayor of London to fast track the purchase of commercial land and buildings that have been empty or unused for two years or more.
At present, around 27,000 homes are being built in London each year – significantly less than the estimated 50,000 homes that are needed every year to keep up with demand.
The Head of Housing at the Policy Exchange, Chris Walker, comments: “The Government urgently needs to make bold reforms to the laws surrounding compulsory purchase of empty or under utilised commercial properties to create a significant supply of land for new housing.
“It should seriously consider making the largest investment in housing since the 1970s to pay for land acquisition, land redevelopment and large scale house building.”1
1 http://www.telegraph.co.uk/finance/newsbysector/constructionandproperty/12159522/Empty-commercial-buildings-in-London-could-provide-420000-homes-for-rent-think-tank-says.html