Comment
Towards a new London Plan: A radical approach to meet our industrial need?
What early lessons can we learn from the new London Plan consultation document in terms of how it seeks to address the capital’s employment need? Directors, Christopher Schiele and Catriona Fraser explore this critical question below.
In March 2025 at the MIPIM conference in Cannes, Jules Pipe, Deputy Mayor for Planning, highlighted the importance of the capital’s industrial land, making sure that it continues to be protected for the delivery of (last-mile) logistics and other employment uses. This is particularly sensitive in light of the strong demand for suitable brownfield sites to be used to address our housing need. The ask of the GLA when preparing could not be greater: find solutions to meet a significantly increased housing target, whilst similarly accommodating for an employment sector which should be seen as an essential form of economic infrastructure to support the growth in housing and, fundamentally, to keep the capital working.
A strategic approach to industrial land supply
Whilst relatively short, the section on industrial land (3.4) embedded into chapter 3 (‘Growing London’s economy’) positively addresses the historic loss of London’s industrial capacity to ensure that its future industrial/logistics demand is met, with particular focus on the provision of sufficient space (in designated areas) to allow for the effective operation of heavier industries. This includes the consideration of whether a strategic industrial capacity should be identified for London (similar to its cross-borough housing target) which is then broken down to a borough-level depending on the availability of strategic land in the most suitable areas to meet this need, i.e. prioritising delivery located near key freight infrastructure such as strategic roads or wharves, rather than following (the current) borough-by-borough approach. This could see radical changes to the distribution of industrial land/capacity across the capital and assist with intensifying areas which benefit from better access to the strategic transport network (including some boroughs delivering far more of London’s industrial capacity than others).
However, it will be necessary to recognise the importance of providing sufficient industrial land across the entire capital (in central, middle and outer boroughs) to ensure employment opportunities, proximity to end users/(last-mile) distribution facilities can support existing and planned housing growth in the right places. Similarly, varying rental values make some parts of London more attractive to certain industries than others, and providing supply taking into account demand in certain areas, will be important.
Nevertheless, we welcome the consideration of a strategic approach to industrial land supply, particularly to ensure that additional industrial capacity is directed to the most suitable (or available) areas, thereby ensuring that the capital can address its evidenced employment needs. Part of this strategic approach may also be the Mayor’s consideration to release poorly performing industrial land (i.e. de facto out-of-town retail parks or underutilised designated areas near public transport hubs) for other uses, whilst recognising that light industrial uses could be located in town centres. If approached correctly at strategic level this may be a route to explore further, subject to ensuring that future industrial need or capacity can be demonstrably met in any existing or newly designated areas.
However, given the slow take-up/market interest in multi-level industrial schemes, the Mayor and his team need to ensure any expectations on the intensification of existing industrial land is realistic, as often enough we have seen overly ambitious targets for designated SIL or LSIS land which turned out to be undeliverable, not supported by latest market/occupier evidence, and therefore commercially unattractive.
Finding a strategic balance to meet housing and industrial need
The GLA rightfully considers how low-quality parts of the green/grey belt could contribute towards addressing industrial land supply shortages which – unsurprisingly – is also a key priority to meet our housing need. Finding a strategic balance to address both requirements whilst ensuring support at borough-level will be key. Nevertheless, we agree that the potential green/grey belt sites in close proximity to the strategic road network (i.e. the M25) is immense.
The consultation document further questions the effectiveness of Co-Location which more often than not resulted in the loss of heavier industries (due to its incapability with housing) to re-provide light industrial space alongside housing as our annual research regularly shows. In addition, our research supports the GLA’s concerns that those schemes can be challenging to deliver. Yet in the right locations, a robust approach to ensuring the ‘right’ type of industrial uses is delivered and with the necessary controls (or separation) in place, it is still a model which could address both our housing and employment need.
Measuring industrial capacity and intensification – a missed opportunity
We do regret that the consultation document is silent on the way in which industrial capacity and intensification can or should be measured in the capital. As we have seen across many schemes that we have advised on in recent years: urban sites with a high existing plot ratio are often not capable of achieving a net increase in floorspace when considering redevelopment scenarios which should also provide sufficient yard space, move servicing away from the highway network, urban greening, or other policy priorities – yet most planning authorities continue to assess a site’s industrial capacity by simply looking at existing versus proposed floorspace in isolation, when its volumetric capacity (i.e. less internal floorspace, but more internal volume), need for sufficient operational yard space or other location-specific market requirements play a similarly important role in making sure our industrial land is used (more) effectively.
Data centres and affordable workspace
With regard to data centres (section 3.8), their vital role in London’s economy is positively recognised by the Mayor. Whilst challenges associated with such developments are noted and will need to be fully considered (i.e. electricity demand, conflict with the delivery of other industrial uses, etc.), the suggestion of identifying strategic locations where data centres/digital infrastructure should be specifically promoted could result in uncertainty in the market. Clarity that designated industrial land (and identified, suitable grey belt sites), particularly where the necessary energy infrastructure is available, should be the preferred location to meet the capital’s/UK’s demand for data-driven industries is considered necessary to attract investment (and grow London’s digital economy). It is positively noted that the consultation document poses the question on how data centres can contribute to wider sustainability benefits (i.e. re-use of waste heat/water).
A review of how and where affordable workspace policies are applied across London is welcomed (section 3.10). The document further highlights that particularly in large-scale industrial and warehouse schemes an on-site provision can be challenging due to the implications on specialist layouts and operational yard space – something that aligns with our project experience, necessitating the question whether such space should better be focused on wider Class E than heavier industrial and logistics schemes.
In summary, the Mayor’s approach to industrial land (and linked industries) introduces new, innovative solutions to issues we have seen in recent years. Particularly, the strategic review of how to best address our identified/additional industrial and logistics need across the capital seems overdue and could offer up significant opportunities to identify suitable sites to grow London’s economy. On the other hand, policies in a new London Plan need to be realistic, yet flexible enough to respond to changing market conditions as advocated for in the NPPF.
Please do not hesitate to reach out to Catriona Fraser and Christopher Schiele if you wish to discuss the direction of travel for development opportunities in London’s industrial and logistics market.
23 May 2025