Property development as important to TfL as its trains and buses
“Commercial development activity is as important to TfL as running the transport system”, says Graeme Craig, TfL’s commercial director. “For a long time we didn’t see ourselves as a property company, but we are one of the largest in London as we own 5,700 acres of land. We are no longer the dull, bureaucratic, backward-looking organisation the property industry once perceived us to be.”
Craig was outlining TfL’s commercial plan to the Landor conference.
Craig says he enjoys equal status with his rail and bus counterparts within the TfL hierarchy.
Commercial development will be increasingly important to TfL as the government revenue grant declines. In the past surplus lands would have been sold off; now TfL is seeking partnerships with property developers to secure long term income streams (as well as plugging any future funding shortfalls).
Population growth is also another driver: London’s population is growing at a rate of 70,000/80,000 per year and is expected to rise to 9 million in 2018, and 10 million in 2030.
Commercial development will fund expansion of the system and enable it cope with additional traffic.
The commercial development function was only established four years ago but has come a long way since: “We didn’t have the expertise to develop this side when it was set up so we brought in people from the other property sectors. Our specialist team now employs 18 people and is growing. We’ve invested £250m and established a new organisation and structure. We have a development plan and expect to generate £1.1bn from property development over the next ten years.
“The developments associated with the new stations at Northwood, Nine Elms and Parsons Green will add 600 new homes and provide £150m of new transport infrastructure. They will be the first three of 75 sites, covering 300 acres, 10,000 homes and 10 million sq ft of development potential that will raise £1.1bn for TfL.
“Advertising makes the most money and next month we will be signing the largest advertising contract in the world.”
TfL has over 400 developable sites, mainly consisting of disused properties from its tube, rail, bus and highways sectors.
An exclusive report from Landor’s 16th Rail Stations & Property Summit, London, 18 February, 2016