Industry Pros Respond To The Government's Announcement That Heathrow Will Get A New Runway
The proposed third runway at Heathrow Airport has been approved by the government, a move that's expected to create up to 77,000 new jobs over the next 14 years, and benefits worth up to £61B over 60 years.
Here’s what some London commercial real estate professionals are saying about the runway addition.
Canary Wharf Group chief executive Sir George Iacobescu CBE says the new runway will be great for Canary Wharf. “It is welcome news that Heathrow will now be able to expand to serve more destinations. When Crossrail opens in just over two years’ time, people will be able to get from London’s hub airport to Canary Wharf in just 39 minutes.
"This decision shows the government is serious about the UK and London being open for business. We look forward to a detailed delivery plan bringing the new capacity as soon as possible.”
To mitigate noise and other nuisances, the government will propose a six and a half hour ban on scheduled night flights, and provide incentives for the neighbourhood worth up to £2.6B. BNP Paribas Real Estate head of national infrastructure Chris Selway expressed concern that there is still something to be desired in the compensation package for people in the neighbourhood having to deal with the disruption to their daily lives for the greater good. “Forward funding of land acquisition and provisions for hardship cases are major priorities,” he says.
Chris also notes that in the zeal to have the third runway at Heathrow, we cannot forget the rest of Britain. “Provincial airport expansion and rail linkage will also be needed to keep the country as a whole ‘open for business.'”
Colliers International head of industrial and logistics Len Rosso said the outcome is great news for the future for West London, which will benefit economically from the creation of new jobs and the increased investment the project will bring. Len says Heathrow already demands the highest rents and land values for warehouse product in the UK, in excess of £15.50/SF and £2M/acre respectively, as occupiers compete for scarce space. "We can expect this competition to continue as occupiers adapt to the increased traffic flowing through the airport," he tells us.
Colliers International director of planning Jonathan Manns says one possible future for the area around Heathrow could be achieved through designation of a West London Green Web. "This would transform land currently defined as green belt to secure a multi-functional green infrastructure landscape, providing new homes and workplaces that are sustainably located to support an expanded Heathrow.”
JLL head of UK research Jon Neale agrees the expansion at Heathrow Airport is good for London. “The commitment to Heathrow expansion shows that the UK remains a highly open and international economy despite the recent vote to leave the EU. Indeed, airport and infrastructure improvements are especially important in light of this as UK PLC will be looking for closer business and trade agreements with non-EU countries. With global flying figures not about to reduce, restricting expansion at Heathrow would result in demand displacing to other hub airports such as Schiphol and Dubai, potentially reducing British business growth and prosperity.
Tim Hancock, managing director of planning at design consultancy Terence O’Rourke, was a signatory to the Let Britain Fly campaign. He also noted the effect the new runway will have internationally. “Heathrow is the airport of choice for the majority of international clients we deal with. With the UK set to rely heavily on trade with businesses beyond Europe, the commitment to further establishing Heathrow as a major global hub was extremely important.
"What Heathrow offers us beyond just an additional runway, is the chance to undertake a major regeneration scheme, with investment in infrastructure, commercial property and the creation of new housing stock. It will be vital to spend the time preparing a structured master plan that has placemaking at its heart, looking at how to make best use of public space so that the area becomes a destination in its own right.”