LSECities

ROYAL DOCKS



CAN YOU HELP DANIEL BRIDGE, THE MAYOR'S CHIEF DEVELOPMENT OFFICER DELIVER THE NECESSARY INFRASTRUCTURE FOR LONDON'S ROYAL DOCKS

Introduction

CASE WRITTEN BY SAVVAS VERDIS

Since 2000, the Greater London Authority (GLA) has played a key role in steering metropolitan level strategy in sectors such as transport, the environment and economic development. One of the key innovations coming out of the GLA, is  its integration of economic and social strategies through a spatial planning approach, mapping out where growth and investment should occur and where economic sectors would most likely become more competitive. From the outset, the Royal Docks were seen as a key part of an eastward growth corridor that had the necessary amount of brownfield land to accommodate new growth in the city. Beyond the market demand, what prevented the development of the area was the lack of transport and social infrastructure to transform the site from what used to be one of the world’s bustling dock areas to a liveable part of the city. It is not surprising that without this infrastructure investment successive government agencies such as the London Docklands Development Corporation, English Partnerships and the London Development Agency have, since the 1980’s, been unsuccessful in kick starting development. Could the GLA finally change this?

In 2012, the Mayor in collaboration with Newham Council published a strategy for the area that coincided with the establishment of London’s only Enterprise Zone, to be managed by the London Enterprise Panel (LEP). Enterprize Zone status gave the Royal Docks a unique opportunity to retain future business rates from current and new occupants for a period of 25 years. This would ultimately provide up to £400 million for upfront infrastructure investment. Having completed a competitive bidding process to find the right partners to develop the biggest sites in the area, Daniel Bridge had to come up with a governance structure for the project and tender for the the vital first pieces of infrastructure that would catalyse further development.

WATCH THE VIDEO

Listen to Dan’s Story and his involvement in the Royal Docks project

THE AREA

The Royal Docks are the Mayor of London’s single largest land holding. Historically, the Royals were part of the city’s thriving dock areas but since their disuse in the 1970’s and despite numerous regeneration strategies, no overarching vision for the area has been delivered. This is partly due to the complex physical severance from road, rail and water networks that exists in and around the site as well as the scale of the area, which compares to the size of central London.

  • Scale
  • Land
  • Landmarks & Communities
  • Social Analysis

Areas marked in Red are owned by the Greater London Authority. The Royal Docks are severed to the north and south by the Docklands Light Railway as well as major dual carriageway roads. The water area itself is considered by many as a major barrier in the social and economic fabric of the docks.

The Excel exhibition centre is one of only two major conventions centres in London. London City Airport is the city’s dedicated business airport serving the City and Canary Wharf. The University of East London makes up the last of the three major landmarks in the area. In terms of established neighbourhoods, the Royal Docks are surrounded by North Woolwich and Beckton but both areas remain separated from the Docks waterfront due to major rail and road infrastructure.

The Royal Docks are surrounded by four ward areas all within the London Borough of Newham. The table below compares these wards together with Newham and London averages.

(2011 Figures)Canning Town SouthCustom HouseBecktonRoyal DocksNewham AverageLondon Average
Residents159961341115141106793079848173941
% of households in Multiple Deprivation353735243726
% of people with no qualification232519142118
% of people unemployed89811109
Full datahttps://goo.gl/M0Q8kchttps://goo.gl/XUwGbuhttps://goo.gl/QfPU83https://goo.gl/kwqX0vClick on any ward link for Newham averagesClick on any ward link for London averages

The Royal Docks in Numbers

22
Billion pounds

Projected investment in the Royal Docks

250
Hectares

The Mayor’s single largest land holding

20
Partners

Over twenty development partners committed to the area

850
Million pounds

Projected Business rates collected in the Royal Docks in the next 25 years

The development process

Working around the Docks existing tenants

Unlike London’s Olympic Park regeneration, the Royal Docks do not provide a clean slate for development. The Royal Docks are home to some of London’s iconic institutions such as London’s ExCeL exhibition area, London City Airport and the University of East London. Any new development or masterplan will therefore needed to work around these institutions. To facilitate the development process, the Docks were subdivided into five large development areas: Royal Victoria, Royal Albert Dock, Silvertown, Gallions Reach and Royal Albert Basin.

By the summer of 2016,  the two larger areas, both owned by the GLA had already been granted planning permission from Newham council. The first was Royal Albert Docks by ABP Investment Limited. This was a vacant 14 hectare site to be developed into a new business destination for Chinese businesses wanting to locate their EMEA operations closer to their markets. Over 2.8m sq. ft of office space would be delivered together with 146,000 sq ft of commercial space with 846 residential units and 180 serviced apartments. The second site was Silvertown Quays by the Silvertown Partnership LLP. This was a 24 hectare site to be developed over three phases with 2.8 million sq ft of Brand Pavillion space (a type of permanent Expo for brands to showcase their products), just under 3000 residential units, 1.9 million sq ft of office space, 100,000 sq ft of retail, 200,000 sq ft for food and beverage and further space for hotels, leisure and 75,000 sq ft of community and education facilities. Following a public procurement process, both developers signed Master Development Agreements (MDA) with the GLA with the understanding that considerable levels of infrastructure investment will be put in place to attract tenants to the site.

It was clear to all parties that without the infrastructure there would have been considerable barriers to occupation and so the development partners started putting pressure on Daniel Bridge to bring forward infrastructure investment.

GLA, DCLG, ENTERPRIZE ZONES, London Enterprise Panel, ABP, TSP, RODMA, ExCEL, London City Airport, University of East London, Newham Council

Stakeholders

National, city and local government stakes in a single development site

All stakeholders have a common goal of bringing the vital infrastructure investment to the area

GLA

Main landholder of the docks with the aim of turning the site into a great place to live and work. The GLA needs to ensure developers deliver on their development agreements.

Newham

Local planning authority and business rate collector aiming to turn the docks into a jobs generator for local residents. Has voiced concerns about development corporations that take powers away from local authorities.

Enterpise Zones

A UK national policy which provides identified areas with business rate relief and other incentives to encourage development and attract occupiers. Importantly it also enables the local retention of business rates for 25 years providing a long term income stream to borrow against.

LEP

The London Enterprise Panel is London’s advisory body to the mayor on the economy and skills. It oversees the entire business rate spending strategy of the Royal Docks. In principle will devote most of business rate revenue in the docks before investing money in other London projects.

ABP

Asian Business Park Ltd is delivering a non speculative business destination for Chinese firms. It has extensive experience in delivering business districts such as the one to be built in London’s Royal Docks. The company was founded in China in 2003 by chairman, Xu Weiping, and has established a reputation for developing large scale enterprise districts in China, through significant projects, bringing together clusters of companies. ABP has already committed to upgrade the Crossrail station in Custom House.

TSP

The Silvertown Partnership is a consortium of Chelsfield Properties, First Base and Macquarie Capital that will deliver a mixed use development of tech and innovation spaces and a number of brand pavilions.

RODMA

The Royal Docks Management Agency is the Estate Management company for the Dock Water paid. It is funded by a service charge fee paid by Royal Docks tenants. The organisation has recently tried to bring together the private sector partners to co-ordinate marketing activities and events on the water.

TfL

The city’s multimodal transport authority overseen by the Mayor. Transport for London has set aside future DLR revenues arising from increased fares in the Docks to fund the DLR stations upgrade.

LEARNING FROM LONDON
The Olympic Park
London King's Cross

Governance

Development corporations and regeneration companies capturing value

Olympic Park

One of the largest regeneration sites in Europe with private development being delivered following over £6bn of public sector investment for the London 2012 Olympics.

King’s Cross

London’s largest inner city development site led by a private developer. The delivery model allows the developer to benefit from high quality infrastructure provision.

What governance model?

Daniel Bridge often looked at King’s Cross and the Olympic Park as the prime examples of how to develop large parts of derelict land into successful London places. At the core of these developments, was a public realm and infrastructure strategy that was created upfront as part of an intensive master planning process and clear finance strategy. Although the infrastructure provision was developed through different delivery vehicles, in both the King’s Cross and the Olympic Park cases, the infrastructure provider was a direct beneficiary of the uplift in development value created by that infrastructure – either as a land owner or as a developer. Spending heavy on infrastructure provision made business sense.

Task 1

Working in groups of five, and based on the stakeholders in the Royal Docks, you are asked to come up with a governance model on who should be delivering the infrastructure in the area?

Delivering the infrastructure

The GLA together with Newham and the LEP jointly commissioned the engineering firm Arup, to undertake an infrastructure prioritisation strategy to transform the Royal Docks. Following heavy consultation with all the stakeholders, Arup submitted its infrastructure investment proposal to Daniel Bridge in April 2016. The proposal listed a 39 key projects, amounting to over £350 million of investment that they considered vital to the success of the Royal Docks. These projects were divided into five categories:

  • Connected: Infrastructure related to linking the Royal Docks with neighbouring areas in East London.
  • Permeable: Infrastructure related to improving mobility within the Docks.
  • Competitive: Infrastructure to improve the Docks as a destination for business and commerce.
  • Distinctive: Investments related to making the Docks a unique destination in London
  • Prosperous: Infrastructure to transform the socio-economic make up of the area, which is currently one of the most deprived in London.

With this list of 39 projects and guaranteed funding from future business rates, Daniel Bridge was now in a position to start tendering for some of this infrastructure. The question remained how should this tendering process take place?

Task 2

Working in groups of five, you are asked to write a short brief to tender for the following four ideas that the stakeholder group identified:

  1. A dock edge pathway
  2. Annual festivals to help promote the Royal Docks
  3. Improve way-finding through apps and signage
  4. Water bus connecting all key locations