Can developers make a place? On London’s industrial regeneration

The Southbank Centre: a successful piece of place-making. Image: Getty.

With the launch of the most recent draft of the London Plan, the phrase ‘Good Growth’ is now firmly on every property professional’s lips. This simple, and pleasantly alliterative, soundbite coined in the mayor’s office is the latest way to talk about London’s future as we battle against all the usual problems.

At the heart of ‘Good Growth’ is the biggest planning trend in our city, as well as many others all over the world: namely, the rise of the mixed-use development and the ensuing move towards placemaking.

For those not in the know, placemaking sounds like jargon, but is actually a quite useful way of describing a very specific approach to regeneration.  All studious Jane Jacobs-reading planners now accept that you can’t just slap a fancy new park into the middle of a redevelopment and hope for the best. Places have to be filled with a diverse mix of users to make them a success. Whether that means pop-up burger vans or art installations, silent discos or roof-top yoga, London is heaving with a new wave of programmed places.

There are many examples of placemaking on show in today’s London: newly-redeveloped areas which have managed to strike the delicate balance between historically sensitive buildings, attractive public realm and activity that turns a new space into a destination. Every London area tends to have its own specific look and feel anyway: perhaps that lends itself more easily to this particular brand of character focused re-development.

The South Bank was perhaps first area to benefit from the transformative effects of placemaking. The area is now synonymous with a plethora of technicolour entertainments: street food pop-ups, art installations, rooftop saunas, igloos, pink buses, giant inflatable purple cows; the Christmas market in December and the deckchair strewn fake beach in July. Sure, some of its food offer has got a little chainy, but its iconic cultural venues complemented by the bars on any available terrace of their brutalist architecture, ensure it’s filled with a huge array of people every day and night of the week. Not bad going for a place which used to be a cardboard city notorious for muggings.

But the other side of the coin is that the original character of a newly made place will be bleached by commercial developers that seek to replace the local community with wealthy leisure seekers and tourists. At the South Bank this trend has been symbolised by the gradual shrinking of the iconic skate park (although its future is now secure thanks to the efforts of the Long Live Southbank Campaign).

“Lots of organisations are involved in placemaking,” says Emily Gee, London planning director at Historic England. “And many are doing it well. At Historic England our main premise is that heritage is key to good placemaking and that this should start from analysis and understanding about the history and character of a place.”

By way of example, she points to the Kings Cross redevelopment, highlighted in Historic England’s recent Translating Good Growth for the Historic Environment report. The scheme involved a widely-praised, historically sensitive masterplan which includes much spectacular design: Thomas Heatherwick’s visionary re-imagining of Coal Drops Yard, opening in autumn 2018, say; or the re-purposing of the old gas holders into luxury apartments.

What really sets King’s Cross apart however is that it is the epitome of a mixed-used development. Its 67 acres of once largely derelict industrial land has been transformed into a “new piece of city” comprising homes, offices, university buildings, cultural venues and public realm, all ‘activated’ by an eclectic events programme that entertains thousands of visitors annually.

While every newly made place in London might plausibly become an exciting destination for leisure seekers, none of them are likely to become somewhere where most people can actually afford live. The question, “Who is London for?” rears its ugly head particularly strongly at King’s Cross, because it’s so nice without being remotely accessible. A casual visitor may notice its attractive architecture and diverse cultural offerings; but they might also feel like they’re walking around a developer's marketing campaign. The bare bones of the site’s industrial past have been left in place, but airbrushed, to create a saleable perfection that is more than a little contrived.

The fact that a disused corner underneath the Royal Festival Hall once became home to London’s skateboarders should remind us that new developments often have unintended consequences – and that no matter how shiny those CAD visions of perfectly manicured new places are the reality is bound to be far messier. Take a stroll down by the canal along from King’s Cross and you will find plenty of tents pitched by rough sleepers. So when we look at the newest developments in London, we should consider that hotly anticipated new destinations, such as Battersea Power Station and Silvertown, will undoubtedly come to have uses entirely separate from those planned for them by their current owners.

Millennium Mills, Silvertown, in 2016. Image: Getty.

Although place-making strategies are important, and the results clearly profitable, they can also smack of a paternalistic inclination for control. Nothing is more irritatingly pretentious than the use of the word ‘curation’ to describe this activity, as at Battersea Power Station.

Despite this, the £9bn regeneration scheme is doing many of the right things. Here, like at King’s Cross, there is a huge amount of energy being expended to put Battersea on the map as a new cultural destination. The developers are investing in the local community by giving grants, the largest of which up until September 2017 went to Battersea Arts Centre to open the Scratch Hub, a new co-working space for local businesses.

Circus West Village is the first part of the scheme to have been made accessible to the public. It comes complete with a new pedestrian entrance next to the river, a mix of independent food retailers and the aptly named Village Hall for events and community use. The ‘curation’ team have already delivered many events here since opening in July, including dance performances, a Christmas pop-up takeover by local makers and the inaugural ‘Powerhouse’ art commission.

Although diverse cultural offerings like these are commendable, they are all still highly controlled, catering for specific tastes and budgets: high-end cultural activity for urban leisure seekers. No matter how ‘curated’ places are, they are not museums – but developers risk being tarred with the same elitist brush as our more gold-plated institutions if they try too hard to emulate them. And this trend for focussing on the added value of cultural activities may serve to highlight the lack of affordable housing in many of these schemes.

To the east of London, something a bit different is happening. The Silvertown Partnership – Chelsfield Properties, First Base and Macquarie Capital – won the right to build on another disused industrial site precisely because it was not planning on doing what other developers in the area are doing (namely, building luxury housing on every square inch of available land). Instead, a crumbling turn of the 20th century flour mill, once part of London’s largest industrial centre at Royal Docks, is being turned into affordable incubator space for start-up businesses, as part of an ambitious masterplan that will transform the 62-acre brownfield site near The Excel Centre into another ‘new piece of city’.


Refreshingly The Silvertown Partnership has so far avoided calling themselves ‘curators’. As one spokesperson told me: “We are enablers, not placemakers.” This suggests they intend the eventual Silvertown programme will be driven by the new creative community they hope to build there.

The partnership is off to a good start with some of the first construction work onsite being the V22 Project of cargo container artist studios installed in 2017. Despite this, some of the artist’s impression of the plans are quite hilariously back to the future, and their PR full of self-aggrandising statements such as “The site will re-invent the atelier on a grand scale”.

Industrial buildings like Battersea Power Station and now Millennium Mills at Silvertown are proving so popular as sites of regeneration precisely because their current state of ruin gives them an exciting faded grandeur. Ultimately, nobody knows how successful these reincarnations will turn out to be, or how these carefully made new places will end up being used or by whom. But it would be fascinating to come back in a hundred years and see how the utopian visions of their current owners have turned out.

 
 
 
 

High streets and shopping malls face a ‘domino effect’ from major store closures

Another one bites the dust: House of Fraser plans to close the majority of its stores. Image: Getty.

Traditional retail is in the centre of a storm – and British department store chain House of Fraser is the latest to succumb to the tempest. The company plans to close 31 of its 59 shops – including its flagship store in Oxford Street, London – by the beginning of 2019. The closures come as part of a company voluntary arrangement, which is an insolvency deal designed to keep the chain running while it renegotiates terms with landlords. The deal will be voted on by creditors within the month.

Meanwhile in the US, the world’s largest retail market, Sears has just announced that it will be closing more than 70 of its stores in the near future.

This trend of major retailers closing multiple outlets exists in several Western countries – and its magnitude seems to be unrelated to the fundamentals of the economy. The US, for example, has recently experienced a clear decoupling of store closures from overall economic growth. While the US economy grew a healthy 2.3 per cent in 2017, the year ended with a record number of store closings, nearly 9,000 while 50 major chains filed for bankruptcy.

Most analysts and industry experts agree that this is largely due to the growth of e-commerce – and this is not expected to diminish anytime soon. A further 12,000 stores are expected to close in the US before the end of 2018. Similar trends are being seen in markets such as the UK and Canada.

Pushing down profits

Perhaps the most obvious impact of store closures is on the revenues and profitability of established brick-and-mortar retailers, with bankruptcies in the US up by nearly a third in 2017. The cost to investors in the retail sector has been severe – stocks of firms such as Sears have lost upwards of 90 per cent of their market value in the last ten years. By contrast, Amazon’s stock price is up over 2,000 per cent in the same period – more than 49,000 per cent when considering the last 20 years. This is a trend that the market does not expect to change, as the ratio of price to earnings for Amazon stands at ten times that of the best brick-and-mortar retailers.

Although unemployment levels reached a 17-year low in 2017, the retail sector in the US shed a net 66,500 jobs. Landlords are losing longstanding tenants. The expectation is that roughly 25 per cent of shopping malls in the US are at high risk of closing one of their anchor tenants such as a Macy’s, which could set off a series of store closures and challenge the very viability of the mall. One out of every five malls is expected to close by 2022 – a prospect which has put downward pressure on retail real estate prices and on the finances of the firms that own and manage these venues.

In the UK, high streets are struggling through similar issues. And given that high streets have historically been the heart of any UK town or city, there appears to be a fundamental need for businesses and local councils to adapt to the radical changes affecting the retail sector to preserve their high streets’ vitality and financial viability.


The costs to society

While attention is focused on the direct impacts on company finances, employment and landlord rents, store closures can set off a “domino effect” on local governments and businesses, which come at a significant cost to society. For instance, closures can have a knock-on effect for nearby businesses – when large stores close, the foot traffic to neighbouring establishments is also reduced, which endangers the viability of other local businesses. For instance, Starbucks has recently announced plans to close all its 379 Teavana stores. Primarily located inside shopping malls, they have harshly suffered from declining mall traffic in recent years.

Store closures can also spell trouble for local authorities. When retailers and neighbouring businesses close, they reduce the taxable revenue base that many municipalities depend on in order to fund local services. Add to this the reduction in property taxes stemming from bankrupt landlords and the effect on municipal funding can be substantial. Unfortunately, until e-commerce tax laws are adapted, municipalities will continue to face financial challenges as more and more stores close.

It’s not just local councils, but local development which suffers when stores close. For decades, many cities in the US and the UK, for exmaple Detroit and Liverpool, have heavily invested in efforts to rejuvenate their urban cores after years of decay in the 1970s and 1980s. Bringing shops, bars and other businesses back to once derelict areas has been key to this redevelopment. But today, with businesses closing, cities could once again face the prospect of seeing their efforts unravel as their key urban areas become less attractive and populations move elsewhere.

Commercial ecosystems featuring everything from large chain stores to small independent businesses are fragile and sensitive to change. When a store closes it doesn’t just affect employees or shareholders – it can have widespread and lasting impacts on the local community, and beyond. Controlling this “domino effect” is going to be a major challenge for local governments and businesses for years to come.

Omar Toulan, Professor in Strategy and International Management, IMD Business School and Niccolò Pisani, Assistant Professor of International Management, University of Amsterdam.

This article was originally published on The Conversation. Read the original article.