Arguments continue about the cost of this summer’s London Olympics and whether or not the UK economy will really benefit. Only this week a report claimed that the games would not have the economic impact the Government hoped.
However it appears the commercial property development that has preceded the games is set to continue beyond the sporting event and this could be the real legacy to the East End.
With less than 100 days to go before the opening of London 2012, not everyone is anticipating the event with the enthusiasm the organisers and the Government would like. This week credit rating agency Moody’s published a report claiming that the games will not provide the boost to the economy many are hoping for.
They warn that any benefits could be offset by the disruption caused to local businesses. Already a group of East End traders have begun legal action against the organisers of the Games over losses they expect as a result of restricted access to their commercial properties.
However, according to property agent CBRE, the long term benefits to the local economy will outweigh any short term difficulties and result in the transformation of the area. £1.6 billion of private sector money has gone into the East End over the past two years. This has already delivered 6,000 homes and 3 million sq ft of commercial property space.
The funding has largely come from overseas investors who recognise the potential of the huge regeneration programme. These come from countries including Australia, Canada and Qatar who have been buying up land throughout the Olympic boroughs.
Unlike the rest of the UK, where the economic climate has brought speculative developments to a virtual standstill, it is continuing at a rapid pace in the East End and this will remain the case following the closing ceremony of the Games on August 12.
Sweden’s Inter IKEA has secured a site in Sugar House Lane which will deliver 1,200 new homes and 400,000 sq ft of commercial floor space. Elsewhere Siemens have invested £60 million in the development of the Crystal Knowledge Hub in Chelsfield and have further plans for a retail commercial property development at Silvertown Quays.
Other projects include a huge mixed use development in Stratford City and the development of a 100 acre plot of land in Royal Docks. Already businesses are moving to the area creating 12,000 new jobs. This is expected to rise to 18,000 by 2014 as the developments continue and result in 4,000 new residents in the area.
Mathew Black of CRB said: “The Olympics is just the beginning, enabling the regeneration of an area that could never have occurred in the present global economic climate…. To put this in context, it took 20 years for Canary Wharf and the Isle of Dogs to go from 0 to 17 million sq ft of offices.
“Unlike other host cities, London’s legacy was planned in advance of the Games, which is why the best is yet to come.”
