Construction in central London has added billions of pounds to the UK economy, new research commissioned by some of the city’s most powerful property developers has revealed.
According to the study by consultancy Deloitte, construction activity in 11 inner-London boroughs added around £6.2bn to the economy in 2013.
The report, Supporting development, enabling growth, pinpoints further contributions of £3.3bn in ‘indirect’ effects from demands on supply chains, and £2.9bn from ‘induced’ gains from increased household spending as a result of construction.
“Property development is a major activity in London, drawing in investment and producing new architecture,” London School of Economics professor Tony Travers writes in the report.
“The economic sectors which depend on the strength of construction extend from developers and architects through to crane manufacturers and brickmakers.”
The research has been commissioned and released alongside a list of demands by the Westminster Property Association and the City Property Association, whose members claim 85 per cent of construction activity in inner London.
In their “manifesto for the mayor”, the associations urge the successful candidate in next May’s mayoral elections to reverse a trend in the city centre that has seen commercial space replaced by residential units.
Westminster alone has “lost” 4.4m sq ft of office space, according to the associations, which have extensive commercial interests in inner London.
They argue the mayor should help tackle affordability by fighting to keep receipts from Right to Buy sales in the city.
The associations also urge the next mayor to encourage the government to axe or relax borrowing limits on council housing budgets, a move they say will allow boroughs to build more homes.
The new mayor should also help address the shortage of tradespeople, which the associations see as a “key reason for the lack of homes and office space”.
“We call for the mayor to work with the associations and industry to help promote and co-ordinate the right training and support for young people and workers of all ages and backgrounds… to provide [them] with the skills… to build London’s future”, they said in a statement.
City Property Association president Rob Samuel described central London as “the economic powerhouse” of the city and the “entire United Kingdom”.
“Our manifesto for the next mayor outlines the key areas where we believe that our industry, and the mayor, can work together to deliver housing, office and leisure space for the capital to continue to thrive as a global city.”