According to Savills recent Market Report, London homes are now worth an aggregate £1.12 trillion, accounting for 22.5 per cent of the UK’s housing value but just 12.2 per cent of total stock. With little empty land available for purchase, the stock available is growing more and more expensive as demand rises. Developers and International investors are taking advantage of any use-able land within Prime Central London and along the river, building upwards and outwards - modern, new-build, luxurious homes at competitive prices per square foot. With little land left spare in the capital and the shortage of supply in boroughs such as Kensington, Mayfair and Chelsea, the Prime market is expanding into the surrounding boroughs such as Bayswater, Maida-vale, Wimbledon and Vauxhall where there is space for development and value. In most years, Londoners saw the redevelopment of the riverside with luxurious new-homes built by developers such as St George and St James, both under the Berkeley homes umbrella, expanding the shoreline of Fulham, Chelsea Harbour and Wandsworth.
This was a response to the shortage of affordable homes within Prime London and as a reaction, taking advantage of unused land along the Thames and adopting a modern architectural trend of Riverview apartments, where prices are just over £700 per sq.ft, and the developments are bleak and uninhabited. The initial plan to regenerate an area of London and build a new community from scratch proved harder than anticipated, and a fear is growing that similarly the case will repeat at Circus West.
The Battersea Power Station remained derelict for three decades years, which once on the market was welcomed with keen interest from varying global and domestic investors, such as Chelsea FC, debating the potential purpose and financial value of the site if demolished or re-generated. Successfully bid and bought by Far Eastern Developers, and three years prior to completion, The Circus West development will see 800 homes built around the iconic brick building that is The Battersea Power Station due to complete in 2016.
Aware of the demand for prime property, Malaysian and Chinese buyers are snapping up units now. Battersea Power Station Development Company (BPSDC) said approximately 600 of the 800 apartments and townhouses in phase one have already been sold since sales commenced in London on January 9th and in Kuala Lumpur on January 12, with talk that all 800 flats and houses will be sold by the end of the month. Of the 800 flats in Phase 1 of the development, none are really affordable with studio apartments starting at £338,000 up to £6m for penthouse apartments, approximately starting at just over £1,000 per sq.ft.
Adding to this, Far Eastern buyers will use these homes as second residences, or for their children when sent to the UK for education. There is no pretence that housing on the Power Station site will be used to alleviate the housing shortage in the capital for key workers and people on average earnings, but rather gamble on the value of the properties in years to come.
Alan Waxman, founder of Landmass, a property “master” in the design and development of small, restricted homes in Knightsbridge and Belgravia, says that it’s not all about location although it plays a crucial role in the prestige and resale of the property. “Many properties featured over full pages in newspapers, as was the case in the Evening Standard last Friday, are finished to unimaginable standards including a gold-leaf swimming pool, mother of pearl finish cinema room and temperature controlled wood panelled wine cellars. These finishes and features bring the price up and over the expected price per square foot in that particular area of street. The price which buyers pay is not just for the size of the property and its proximity to Harrods or Hyde Park, but instead what the property offers within its walls. Some of these stretch to over £6,500 per sq.ft, setting a price tag of a property to £70million, attracting only buyers from Russia, the Middle-East and the Far-East.”
Having developed over forty properties within the SW1 and SW3 boroughs, Waxman feels that the finish to a property and the quality of build is key to its value. One cannot simply demand a price purely upon its postcode strategy. Waxman gained further industry-recognition when a property of his won Best Interior Design and Best Property London in 2009, and drew interest from Nicole Kidman as a potential buyer. The property, a double fronted mews house located in the prestigious gated stretch to the rear of The Lanesborough Hotel was finished to an immaculate standard, featuring walnut flooring, stone and marble bathrooms, sliding glass roof light well and steam room. “I didn’t design the house to a particular buyer” says Waxman, “I included all the necessities any owner would want, such as under-floor heating and included niche design features like a water feature and light-well to allow more natural light to flood through the house at each level but did not invest in over-the-top finishes as most clients will change to their taste”.
Landmass is currently finishing a bespoke mews house a few feet from the trendy Motcomb street in the heart of Belgravia. Once again, Waxman has accomplished a unique enviable living space across three levels, adding a subbasement and roof terrace to the three bedroom property due for completion in Spring this year. As an offering, Waxman has allowed for any potential buyer to purchase the property prior to completion and put their own stamp on the property by choosing the finish, colours and fabrics. “Mews houses used to be stables and staff quarters for large residences on Walton Crescent and Grosvenor Square. It’s amazing how now they are valued at almost £3,000 per sq.ft, because of their location and living-space offering.”
For more information or to subscribe to future press releases, please contact Fraser Dyer at the office on 0207 235 8345.