A new initiative launching next week by Transport for London (TfL) will offer investors and developers the opportunity to battle it out for prime commercial space.
TfL has announced that it will be placing 50 tube stops, bus stations and other properties on the market, in a bid to raise up to £3.4 billion for investment into transport infrastructure upgrades.
While a number of the sites are expected to be snapped up by housing developers for conversion into penthouse apartments and new homes, TfL anticipates a high level of interest from commercial developers who will seek to construct bars, restaurants and tourist attractions in the capital’s major consumer hotspots.
This one year tender process will effectively be the first step in TfL transforming itself into a property company by “unlocking its property estate”, according to director of commercial development Graeme Craig.
He continues; “London’s population is set to grow from 8.4 million today to 10 million by 2030.
“London needs more homes and office spaces and the transport network needs sustained, long term investment.
“There is no one company who can cope with the scale and diversity of this project.”
In order to achieve the aims listed by Mr Craig, TfL will appoint a small group of property development partners as a means of ensuring Londoners gain commercial and residential properties which are most needed in the city today. This process will be overseen by former chief executive of Land Securities Francis Salway, who this week was appointed chairman of TfL’s new property advisory group.
Although it has not yet been revealed which assets will be included in the scheme, much of TfL’s 5,700 acre estate can be found in lucrative Zone 1 and 2 locations.
The Mayor of London, Boris Johnson, has welcomed the project, which is expected to take around 10 years to complete. He believes that the unlocking of revenues from key assets in the portfolio will not only allow for greater investment into transport infrastructure around the city but will also help to reduce increases in travel fares for the city’s millions of commuters.
While this is not the first time the underground network has become home to commercial ventures – a number of retailers currently operate subterranean click and collect hubs, for example – it will be the largest unlocking of assets undergone by TfL to date. Hopefully, the transport body will be able to achieve its goals and bring London’s transport infrastructure into the 21st century as a result.
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