Southwark Council is gearing up for new development on Old Kent Road, SE1, with fresh acquisitions and a plan to bring forward the Bakerloo Line extension and boost housing in the area.
The council is buying the Toys R Us site at 760 Old Kent Road. The 2.59-acre site currently holds a Lidl and is being sold from receivership, after the group went into administration.
A sale was first pitched in 2018, with agent Morgan Williams seeking £55m for the land and receiving unconditional bids of around £25m. However, the vendor pulled the sale and secured Lidl for the site, bringing it back to market this year with CBRE, which is seeking offers in excess of £20m.
Southwark has approved the purchase using the general fund. It will allow 500 homes built over a new Tube station, with 50% of the homes to be social-rented.
Johnson Situ, Southwark’s cabinet member for growth, development and planning, said: “The Toys R Us site is a key purchase from the council because it is also the identified site for the second station for the Bakerloo Line extension.
“That allows for the council to play a role and show our confidence in the Bakerloo Line extension.”
Transport for London is consulting on plans for two new Tube stations on Old Kent Road – one at the Toys R Us site and a second at the Tesco site. However, Southwark expects that funding for this may be delayed as a result of Covid-19.
Situ said the council’s investment will “allow a smoother transition” with TfL to deliver the Tube station, in turn unlocking a further 10,500 homes in the second phase of the opportunity area action plan. He added: “This is hugely important in terms of meeting the housing need, in respect of jobs and our commitment to net zero development by promoting public transport.”
Council intervention
The acquisition is the latest in a string of site purchases as part of Southwark’s commitment to provide 11,000 new council homes by 2043.
Last year, the council acquired the Currys PC World site at 589 Old Kent Road for £26.1m, with a plan to develop 450 homes on the 1.4-acre site, backed by borrowing against its housing revenue account. The deal was subject to the expiry of the tenant lease in June 2022.
Southwark also bought half an acre at 711-717 Old Kent Road for £12.3m at the end of last year, with plans to develop more than 200 flats and 16,500 sq ft of commercial space. The council will also seek to acquire a number of smaller unregistered sites by compulsory purchase order next year.
Situ said: “There are a number of sites where the council has identified there can be new council homes, mixed with employment and retail opportunities on the ground floor.”
Southwark is working up planning applications to directly develop these sites while it negotiates with tenants.
“The Old Kent Road is a place where the community is extremely proud of the area,” said Situ. “It is diverse and a place that businesses call home and has had light industrial space as well – all of which we want to strengthen and build on.”
A 30-year plan
This week Southwark’s cabinet approved a new masterplan for the area, which will see two new town centres, 7,000 affordable homes with 5,000 for social rent and two new Tube stations. It pledges to be net carbon zero by 2030, with 74 acres of public open space by 2045, and seeks to double the number of jobs to 20,000 within the opportunity area.
The plan commits to a new secondary school, two primary schools and expansion of nine other schools and the council is also looking to bring a new university to the area.
“It is based on our communities and making sure that the built environment supports our communities ambitions,” said Situ. This includes providing the infrastructure and facilities to support the 3,500 people on the housing waiting list and to tackle high levels of air pollution and childhood obesity. “We are really using this as a tool to address some of those deep-seated issues as well as reduce inequality.”
The new Old Kent Road plan will be open for public consultation between 11 January and 5 April 2021. The plan is already five years in the making and is expected to be adopted by 2022.
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