The City of London Corporation has chosen not to intervene in the ‘right to light’ stand-off which is delaying the development of Goldman Sachs’ new headquarters.
The US investment bank was given the green light for the 850,000 sq ft office building in October 2013, but the scheme faces a possible legal challenge from the owners of two neighbouring properties who claim their ‘right to light’ will be affected if the Farringdon Street scheme goes ahead.
Goldman Sachs has already agreed compensation packages of £1.2 million each with the owners of 11 other properties whose ‘right to light’ will be infringed. However, Aberdeen Asset Management and Royal London Asset Management are holding out for a share of the developer’s profits and have indicated that they may take the matter to the courts.
Goldman Sachs asked the Corporation to intervene in the dispute through the implementation of ‘Section 237’ powers of the 1990 Planning Act, which allow councils to acquire an interest in land for planning purposes when the development is deemed to be of benefit to the local area.
The Corporation agrees that the provision of office space, employment opportunities and improvements to the public realm, far outweigh the reduction of light to neighbouring buildings, and that Goldman Sachs has acted reasonably in offering compensation to the owners.
Nevertheless, on Tuesday the Corporation refused to grant the Section 237 notice and urged the parties involved to reach an agreement by the end of the week.
How this agreement might be reached is difficult to see, but the saga is not something the City will want to drag on for much longer.
A number of financial institutions, including Barclays and HSBC, have already relocated from the City to Canary Wharf and the Corporation will not want Goldman Sachs to follow them if it is to maintain its position as the world’s leading financial district.
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