Sir Sadiq Khan has admitted that “we have got to do better” in delivering new housing to London as he flew to Europe’s biggest property conference to drum up foreign support for a huge investment boom in the capital.
The Mayor, speaking to the London Standard at the annual Mipim event on the French Riviera said: “I’m the first to admit supply has not met demand, and we have got to do better, and we’re going to do better with the support of national Government, councils, but also with some foreign investment.”
Sir Sadiq, now nine years into his Mayoralty, also signalled that he will step into the planning log-jam far more often during the rest of his third term at City Hall in a move that could put him on a collision course with town halls.
He said he would be prepared to take over more schemes where “councils are not willing to make a decision that's in the right interest of the…community” and also to set up more mayoral Development Corporations of the kind currently proposed for Oxford Street.
He was speaking after what has been described as “a lost year” for affordable housing in London.
Starts on new affordable homes in the capital fell by a record 88% in the last financial year from 26,386 to just 3,156 with some boroughs including Harrow, Bexley and Richmond-upon-Thames starting work on just a single affordable property.
The Mayor said London had not been immune from the worst national housebuilding conditions on record since the Second World War with construction costs, inflation high interest rates, lack of skilled Labour, the Ukraine war and Brexit all holding back construction.
The government has set a target of 88,000 new homes a year in London as part of its ambition to deliver 1.5 million houses and flats during the Parliament. That is around twice the historic rate of housebuilding in London in recent years and a total that has not been achieved in a single year since 1934.
The Mayor accepted that the notoriously slow planning process at council level needed to be drastically speeded up in London if the targets are to have any chance of being met.
He said: “But there are challenges in terms of the delay, in terms of getting planning done. In terms of you speak to a council, they say “yes”, initially, the council officers says “yes”, the leader says “yes.”
“But it goes to committee because of a petition, and if councils have a small majority, they then say, no, and all this money is wasted.
“Or the challenges with assembling land and what I can say to them is, just today, this government's published a planning an infrastructure bill the previous in the pudding.
“This bill does a number of things that will help you. Firstly, it avoids hope value when it comes to land, so you won’t have a situation where developments are no longer viable.
Secondly, if council are not willing to make a decision that's in the right interest of the scheme and the community, the mayor will take it over or the government.
“Thirdly, the government's going to give Development Corporations even more power. We've got two in London. I want to set up more, so you as a developer, got confidence now that the government and the mayor and actually councils are can do when it comes to schemes.”
Khan said the election of a Labour government last July was a “game changer” for London after years of Conservative administrations often at logger heads with City Hall.
It was this new backdrop of stability that persuaded him to visit Mipim for the first time since he was elected London’s Mayor in 2016. Both his predecessors Ken Livingstone and Boris Johnson had regularly attended the conference.
Khan said: “So I can say to investors and developers with honesty, and candour, now's the time to invest in London if you want housing, student accommodation, build to rent, retail, logistics, leisure, urban sciences, transport infrastructure.”
He continued: “And you've got at Mipim more than 20,000 delegates, but importantly, some of them are investors and developers. They want to build homes. They want to create a sense of place. I've already, in the last 24 hours, spoken to investors from Canada, America, Japan, the Far East, the Middle East, Belgium, Australia, France and so forth.
“And I've got something to offer. But also we can say, listen, if you think about coming to London, you can know, there is a mayor on your side, but the government's on your side as well. “
“So the key, the key thing, if you look at the UK now, more importantly, London, is we have, you know, interest rates coming down and market confidence going up, which is really important.
“We also have an opportunity...Frankly speaking, we've got stability, which is really important. The other thing we're going to be frank and candid amongst ourselves about is with the best of the world, the government can’t do by ourselves do what we need to do in our great city, in terms of transport infrastructure.
“Think about Liverpool Street, Waterloo, Victoria Euston as transport infrastructure. Think about the DLR extension, Baker line extension, West London orbital. Think about the homes we need student accommodation build, to rent, life sciences and so forth. We need foreign direct investment.”
“We've got to be quite clear. We've got certain expectations. We've got the rules of the game. It's not free for all. That was a previous Mayor. There are rules of the game when it comes to investing in London.
“And there's a lot of excitement in terms of investment flight from other countries coming to London, in terms of people recognizing that actually, you've got a situation now where the grown ups are back in charge in terms of Whitehall.”
