Speaking at a private event last month run by the Centre for London think tank, Tory London mayoral candidate Zac Goldsmith was questioned about his business priorities. Will you pledge to reduce restrictions on creating more office space in prime central London? one questioner asked.
Amid an audience peppered with influential developers and big business types, it would have been easy for Goldsmith to give woolly assurances about the importance of building growth in the city centre. But instead, he responded that lifting height restrictions in commercial parts of Westminster – as the questioner wanted – was very much not at the top of his agenda.
Goldsmith cited the case of Barnes, a corner of his current Richmond constituency, where over a quarter of office space has been converted to residential use in the last year alone. “Barnes is losing out,” he warned, adding that previously thriving parts of outer London face the threat of becoming little more than “dormitory suburbs”.
As an MP who has made his name fighting hard to protect the character of his community, his intention and sincerity is evident. But staying true to that ethos as mayor of London would be a mammoth task.
By almost any measure, business in outer London is doing well. Undergoing rapid growth in the last decade, the capital over 500,000 active businesses – by far the highest number of active businesses of any region, almost 100,000 more than the rest of the South East and 250,000 more than the North West.
And, of those businesses operating within the capital, the proportion based in the outer boroughs stands at just under half. But that percentage is declining, falling slightly each of the ten years to 2014, according to official figures. Figures for 2015 are likely to see this heightened, with increasing numbers of office-to-resi Permitted Development Rights taking effect in outer London.
Let’s not start playing the violins just yet – the relative decline is slight and in absolute terms things are going well. Year on year, the number of outer London businesses has grown steadily (including in the borough of Richmond, home to Barnes).
But that business growth is broadly all in retail: booming as they are, our suburbs are edging towards becoming evening and weekend shopping districts for commuters. They’re not exclusively so, but the trend is apparent.
As the “dark star” gravitational force dragging wealth and business towards the centre grows ever stronger, it throw up questions about the future of our major cities. To what extent should a mayor prize the health of suburban town centres? And, in an age of constrained budgets for the delivery of local services, should protecting ailing town centres come at the cost of wider overall economic benefit?
Perhaps not. The 2010 report from the mayor’s Outer London Commission talked of moulding London along a polycentric city “star and cluster” model. That would mean developing a number of suburban metropolitan centres as business destinations in their own right.
The “Star and Cluster” model of urban centres. Image: Farrells, printed in Outer London Commission report 2012.
The recommendations incorporated into the mayor’s London Plan certainly helped the case for greater orbital London transport. But the suburbs of a city as big as London occupy a difficult hinterland in which, economically, their options for regeneration are limited. Large scale investment in service office space does not offer the return of the inner city, while those looking to build standalone business and manufacturing parks can do so at a far lower cost further outside the city. And as the demand for suburban housing drives up land prices, the problem gets worse.
Trying to reduce the dependency of a dormitory suburb on the greater city is akin to trying to turn an oil tanker. Perhaps, then, the best outcome is working towards the growth of both the suburb and the city as a whole.
In identifying their high-growth-potential suburban centres, the Outer London Commission focused heavily on their positioning within transport corridors directly accessible to the city centre. There is an acknowledgement that the best return comes from building on this connectivity. And while this does lead to suburban growth, this same connectivity which makes it possible inevitably means that a chunk of the money generated is spent in the city centre rather than in the local community. When this happens multiple times across the edges of a city, the centre grows further, the laws of agglomeration each time strengthening its return.
So what are the options for Barnes and similar pockets of suburbia, which lack those connectivity benefits altogether? Localised currencies such as the Brixton Pound can help to build local growth without feeding dependency on the city centre.
Perhaps more likely (and economically productive) is for a council to lobby to create a Business Improvement District, or to promote an area as ripe for a sector-specific development on a massive scale (such as that of Canary Wharf, or Brookings’ Innovation District model). With schemes like this, a proportion of wealth flowing into London’s centre may just be an inevitable byproduct – rendering those other suburbs that little bit more dependent.
In other words, any mayor looking to bring office space back to the suburbs has their work cut out.
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