PROPERTYdevelopment
physical design, since the tapering floors at the top are unsuitable for offices.” It’s only outside the City that residential towers have been built: Strata London, in Elephant & Castle, was quickly nicknamed ‘the Electric Razor’ after its slanted roofline. Although the building incorporates 98 shared ownership flats to fulfil its affordable housing brief, the 310 remaining apartments on higher floors appear to have sold mainly to investors. So far, though, it has the South London skyline to itself.
Why so high? What’s the rationale behind the towers? Peter Damesick says that a major reason for building towers in the City is that large organisations want larger buildings to consolidate operations, it is difficult to do that with a six to eight floor building unless the footprint of the building is immense. “The appeal of tall buildings to major corporate occupiers related not so much to whether the building is tall, but whether it’s large enough to house such an organisation and consolidate its activities under one roof,” he says. “In the past ten to fifteen years, the main difficulty has been that within the traditional boundaries of the City, such space just hasn’t been available.” That sent users such as Citigroup,
Barclays, Clifford Chance, HSBC and Lehman over to Canary Wharf where they could get the space they needed; HSBC relocating from a dozen different buildings, spread across the City, to a single building. It’s intriguing though that the total
floorspace of some of the new generation towers isn’t as much as it could be for their footprint. For instance the Cheesegrater, owing to its sloping profile, offers only 84,424 square metres floorspace, half what 1 Canada Square can offer, at the same height.
lonDon – groWing up
350 300 250 200 150 100
metres St Paul’s
Cathedral The City
20 Fenchurch Street
‘Walkie Talkie’ 34 JANUARY 2011 PROPERTYdrum 100
Bishopsgate The City
30 St Mary Axe
‘The Gherkin’
Tower 42 ‘NatWest Tower’
122 Leadenhall Street
‘Cheesegrater’ 110
Bishopsgate Heron Tower
One Canada Square,
Canary Wharf
Pinnacle ‘Freedom Tower’
The Shard London
Bridge Tower 111m 160m 165m 180m 183m 225m 230m 240m 288m 310m
demand base with shorter leases, and offer tenants easy opportunities to expand space as they grow. That worked well for Tower 42 (former NatWest tower), and could help Heron Tower too. London is a pretty low rise environment
The Walkie Talkie Rafael Viñoly’s controversial City of
London scheme speaks volumes
compared to other financial centres. New York has 426 buildings over 110 metres high, and Tokyo has 215; Shanghai at 135 is still growing fast, and Dubai has 60. London, on the other hand, has only 21, just ahead of Paris (which, interestingly, has recently announced a change in its low-rise policy). Even with the new towers, that’s not really going to change.
DemanD, timing anD viability Of course the big question is whether all this space will be rented out, or whether the skyscrapers become white elephants. The key to their prospects will be timing. As Peter Damesick notes, supply of larger spaces in the City is inelastic, while demand is relatively constant. It takes three to three-and-a-half years
Heron Tower For 70-year-old Gerald Ronson, this must
be the height of his ‘interesting’ career Towers do of course also offer prestige.
Peter Damesick says some smaller firms are keen to rent up to three floors, “They want premises in a landmark building to put themselves on the map.” A floorplate building aimed at smaller occupiers who want to take up to three floors, with a high- quality/service concept, can draw on this
from the demolition of the preceding building to completion of an office building, so capacity can’t be brought on stream quickly. And that’s before you take into account the time taken to get planning permission, which can be lengthy, particularly with higher buildings given sensitivity over sightlines to St Paul’s Cathedral. Several of the tower plans were originally rejected, and were significantly revised before resubmitting. And towers can be riskier to build than
other properties. They take longer to build, and they are more expensive to construct than the same amount of space in conventional buildings. Developers will be looking for some payback for their higher costs, in some cases nearly a decade after the plan was first put together.
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