Westminster’S Economy Developing Westminster’S City Plan
DEVELOPING WESTMINSTER’S CITY PLAN
Booklet No. 6
Westminster City Plan Consultation - City Management Policies Revision
February 2014 Foreword
Cllr Robert Davis DL
Westminster’s continued economic success is vital not only to the prosperity of its residents, but to those of the United Kingdom as a whole. We have more jobs in our area than any other London borough, and a huge range of enterprises - from globally famous department stores to corner shops. Our businesses are also a vital element in Westminster’s uniqueness, providing services and opportunities that make it such an exciting and rewarding place to live, visit or work.
It is essential that our planning policies provide a basis both for existing enterprises to flourish and grow, and to encourage innovation and new businesses. The sheer diversity of the City’s economy is one of our major strengths, and we need to make sure this is safeguarded by ensuring there are the right kind of workspaces in the right places.
There are parts of the City which are less successful than others, and our policies must spread success and its benefits more widely, providing opportunities for residents and tackling problems of worklessness and disadvantage.
The policies in this booklet are intended to address all these aspects and pick up on some of the most important issues in planning. Getting them right is obviously vital, and I look forward to considering the comments we receive on them.
Councillor Robert Davis DL
Deputy Leader, Westminster City Council
Cabinet Member for Built Environment
2Introduction
The policies covered in this booklet are:
•Strategic Policy S12 - North Westminster Economic Development Area
•Strategic Policy S13 - Outside the CAZ and NWEDA (shopping centres)
•Strategic Policy S19 - Inclusive Local Economy and Employment
•Strategic Policy S20 - Offices and Other B Use Business Floorspace (part)
•Strategic Policy S21 - Retail
•Strategic PolicyS27 -Buildings and Uses of International and National Importance (including Diplomatic and Allied Uses
•City Management policies
•CM1.4 - Retail in the Central Activities Zone
•CM 2.2 - Portland Place Special Policy Area
•CM 2.3 - East Marylebone Special Policy Area
•CM13.1 - Local Shopping Centres
Because of the complexity around office development a separate booklet is being produced dealing with the issues around office to residential development and mixed use. Also part of Westminster’s economy, a booklet has been produced for food, drink, entertainment, tourism, arts and culture.
We would welcome your views on proposed new policy wording, which is shown as underlined or identified as entirely new policy. Adopted policy is shown in bold and is not intended to be altered as a result of this consultation..
3
Trends
1. Westminster’s Economy
2. Jobs in Westminster - All Economic Sectors
3. Westminster’s Global Role
4. Local Deprivation and the Local Job Market
5. Offices outside Commercial Areas and NEWDA
6. Other Class B Uses
7. Westminster’s Shopping Hierarchy
8. Town Centre Profiles and Performance
9. London and Westminster Retail Market
Insights
1. What Are We Trying to Achieve?
2. A Functional Approach to NWEDA
3. East Marylebone and Portland Place Special
Policy Areas
Victoria NOVA Proposals, Land Securities
4. A Sequential Approach to Retail
5. The CAZ Approach to retail
6. What Should we Protect?
7. Department Stores
48. Local Shopping Centres
9. Small and Independent Retailing
10. Non-A1 Retail Uses
11. Temporary Uses
Recommendations
1. Retail in the Central Activities Zone
2. Portland Place Special Policy Area
3. East Marylebone Special Policy Area
4. North Westminster Economic Development
Area (NWEDA)
5. Outside the CAZ and NWEDA
6. Training and Employment
7. Offices and other B Use Floorspace
8. Wholesale Showroom Uses
9. Diplomatic and Allied Uses
10. Retail
5TRENDS
WESTMINSTER’S ECONOMY
Businesses
Employees GVA Generated
ADF
Westminster also has the single largest number of businesses of any London borough, with 50,100 businesses currently located in Westminster (Experian, 2012), which is around 12% of London’s total, and is a growing figure. Camden has the next highest number, with around 24,000 businesses (IDBR, 2010).
Westminster has 673,000 employees (ONS,
2013), the most of any London borough by some Westminster’s economy, in 2011 distance, representing 13% of London’s workforce. This is nearly twice the amount when compared to the second highest London borough, which is the City of London.
In terms of output generated by
Westminster’s GVA (Gross Value Added) was £46.14bn, which equates to 16.3% of London’s total, and over 3% of national
GVA (Peter Brett Associates, 2013).
The number of employees is projected to rise by a further 10% up to 2031, meaning that by then the number may exceed 740,000 (LOPR, 2012).
Again, Westminster is the single largest generator of GVA of any London Borough, compared to £39.9bn generated by the City of London (Peter Brett Associates, 2013).
A majority of Westminster’s businesses are small businesses, with 85% of VAT registered businesses having fewer than ten employees (IDBR, 2010).
Employee jobs are overwhelmingly located in the two central wards of St James’s and West End, which combined account for the location of nearly two thirds of all Westminster jobs. since the 1990’s.
Westminster’s GVA is projected to rise to
£48.5bn by 2014, having risen steadily Westminster has a very diverse economy, however the largest sectors by business numbers are the Knowledge Economy
Westminster GVA (£million)
50,000
Westminster Businesses 2007-12 (Experian,
2012)
(17,700 businesses) and Retail/
40,000
30,000
20,000
10,000
0
Entertainment/ Leisure (11,600).
52.0
50.0
48.0
46.0
44.0
42.0
40.0
Britain is home to the HQ’s of 29 Global
500 companies, seven of these are in
Westminster, including BP, BAE Systems and the Rio Tinto Group.
“50,100 businesses.
“An Economic Power House:
One in 40 workers in England work in Westminster.” Better
City, Better Lives (2013)
(Westminster) contributes £46 billion or 3.1% to National Output”
Better City, Better Lives (2013)
2007 2008 2009 2010 2011 2012
6Jobs in Westminster - All Economic Sectors
Professional, scientific, technical
17.4%
Accommodation food services 11.7%
Administrative support services 9.1%
Public administration defence 8.2%
Financial insurance activities 6.7%
Wholesale retail 11.9%
Information communication 9.6%
Real estate 4.7%
Education 4.4%
Other service activities 3.9%
Health social work 3.9%
Arts, entertainment, recreation 3.5%
Other (transport, storage, construction, manufacturing, utilities, other)
5.0%
Total number of all jobs
Business Register and Employment Survey
ONS Crown Copyright Reserved (from Nomis on 18 April 2013)
673,000
7
Accessibility
Tourism, attractions and hotels
Westminster is visited over 55 million times a year, with tourism expenditure totalling nearly
£7bn (LDA, 2007).
State and government
Westminster is home of the state and national government, acting as a generator for employment and as a tourist attraction.
4 mainline rail stations, with direct connections to the world’s third busiest airport, Heathrow
(70 million passengers per year, accessed via
Paddington), in addition to Gatwick, accessed directly via Victoria.
Home to 5 of top 20 paid attractions in London, and 6 of top 20 unpaid attractions.
Royal Palaces sit alongside the home of government, acting as an international focus point for events and ceremonies, bringing together dignitaries from all over the world throughout the year.
Crossrail Line 1 (under construction), 10
London Underground lines (32 stations) supporting a daytime population of over 1 million people.
450 hotels, with 40% of all London’s bed spaces, with numerous international high end hotels alongside other accommodation types.
Image from Google
Business
Westminster is a global office centre, with over
9million sqm of office floor space, coupled with on going high demand as illustrated by the high levels of rent and low vacancy levels.
A centre for global HQs as discussed.
Home to creative industries, hedge funds, real estate, and other key economic sectors.
Retail
Entertainment Uses and NTE
Arts, Culture Sport
National and global centre for retail and fashion with Oxford Street as the nation’s high street, alongside the more luxury retail streets focussed on Bond Street, which has the highest rental values in the UK.
Unparalleled number and range of restaurants, pubs and bars, and other entertainment uses with world renowned focus in the West End.
Home to international film premieres, the Proms at the Royal Albert Hall, London Fashion
Week, National Gallery, Tate Gallery, Royal
Colleges of Art and Music, Theatre Land and the Royal Opera House.
4000 restaurants/pubs/bars/entertainment uses
(Experian 2012).
Very low vacancy rates alongside high demand, particularly in the West End and primary shopping streets.
38 theatres in Westminster, including the renowned West End theatre land.
Unrivalled number of fine dining/Michelin starred restaurants, as a world leading dining destination.
Home of international Cricket at Lords Cricket
Ground, and London 2012 Olympic venue for several sports across Westminster.
Luxury retail quarter in Mayfair and St James’s and home to international niche retail markets such as tailoring, art sales, and jewellery.
Over 20 casinos. 24 hour economy, with Soho being busier at night than it is during the day.
8
JSA: Job Seekers
Allowance
Polarisation, and localised deprivation
• 87th most deprived local authority out of 326 in 2010 Index of Multiple
Deprivation (IMD). In 2004 Westminster was 39th showing improvement.
• Between 2007 and 2010, 75% of Lower Super Output Areas (LSOA - sub division of wards used for the Census) improved their overall IMD rank.
• Deprivation is concentrated in Queens Park, Harrow Road and Church Street.
Queen’s Park contains LSOA’s that are in the top 5% for overall deprivation nationally (the single most deprived LSOA’s are in Liverpool and Blackpool), and contains the single most deprived LSOA’s in England for the individual measure, children affected by income deprivation.
Household Income (CACI Pay check Data, 2013)
• 2013 median household income in Westminster is £36k, with an upper quartile of £60k and a lower quartile of £19k. The ward with the lowest median household income is Church Street with £24k, the highest is
Marylebone High Street with £42k. And the LSOA with the highest median household income is in St James’s with £48k (mean income of £57k and upper quartile income of £72k).
Local Job Market
• Westminster is home to 642,498 employee jobs with a resident population of around 223,000.
• 42% of Westminster’s residents who travel to work stay within the borough, 54% work elsewhere in London, and 4% outside of London.
Barriers to Job Market
“Historically Church Street has under
• Pockets of deprivation, with performed as a business location- this is skills shortages. underpinned by a lack of suitable workspace and a local population characterised by low levels of economic capacity and income” The Futures Plan-
Church Street, Paddington Green, Lisson
• Relatively high proportion of young people not in education, employment or training (NEET) compared to London average.
Grove (2011) City of Westminster and Urban Initiatives'
9
• Low employment rate and economic activity rate.
Limitations of Legislation
Not office locations?
Changes to the General Permitted Development Order, made in May 2013 allow extensions to office premises of 100sqm (previously 50 sqm) provided this is not more than 50% of the building
(previously 25%) without the need for planning permission. This does not apply to listed buildings and premises inside conservation areas. As over 75% of Westminster is covered by conservation area designations, it is considered that the impact of these changes is likely to be limited.
Offices are the second largest use in Westminster, making up
27% of all land uses. However, outside the main commercial areas* and NWEDA (where offices are directed), there is limited scope for office expansion. The Council wishes to sustain and enhance the residential character and function of these areas but recognises that some of the activities which can help support residential communities take place from
B1 office premises, such as offices for local charities or offices for the co-ordination of private, public health or community services.
There are also existing established office occupiers in these areas who may want to expand. The Council supports small businesses and appreciates that it may be less costly for these businesses to extend their existing premises rather than relocate.
10
*The Core Central Activities Zone, the Named Streets, the Opportunity Areas and shopping centres. OTHER B USES
A recent desk top study (March 2013) indicates that there is just under 9,500 sqm of B8 storage and distribution floorspace and some 58,000 sqm of floorspace being used for B1c light industrial purposes. However the majority (62%) of the light industrial uses are taking place in B1 office accommodation, and mainly in connection with film/TV post production editing.
Since 2006 the Council has attached conditions to permissions ensure that 4,821 sqm of space is limited to B1c light industrial floorspace. There are no B2 general industrial sites in Westminster.
1990 Landuse Survey of light Industrial B1c uses
Professional scientific services
Printing, publishing, etc
Women's clothing
Jewellery precious metals
Other electrical goods
Medical/Dental instruments appliances
Media type uses
Electric appliances capital goods
Men's boys' tailored outerwear
Footwear
Misc. light manufacturing industries
Hats, caps millinery
2012 survey update of light Industrial (B1c) uses
Film Post production editing
Sound recording / Music production editing
TV Broadcasting (editing)
Great Western Studios*
Tailors (outside Savile Row)
Jewellery manufacture
Embroidery workshop
Computer games
Dental instruments appliances
* Great Western Studio containing a mix of creative industries including clothing, media, (Film Post production) Ceramics and Artwork
11 The Town Centre Network
WESTMINSTER’S SHOPPING HIERARCHY
Primary Frontages (International Centres): Oxford St,
Regent St, Bond St, Knightsbridge. The nation’s preeminent shopping streets, internationally renowned, and a major location for flagship and iconic department stores such as Selfridges.
Core CAZ: Suitable location for retail throughout
(including retail sub-market areas such as Mayfair, St
James’s, Soho and Covent Garden, each of which has a distinct character and function).
CAZ Frontages: Mixed use streets with a predominant retail focus (such as Marylebone High St, Baker St,
Victoria St).
Major Shopping Centre: Queensway/Westbourne Grove.
Borough wide catchment, with an indoor shopping centre and range of town centre and other uses and services.
District Centres: Key neighbourhood centres providing convenience and some comparison retail alongside other town centre uses and local services. Includes St
John’s Wood High Street, Harrow Road and others.
Local Centres: 39 designated local centres which are convenience shopping focused centres providing essential accessible locations for local residents across
Westminster.
Retail in Westminster: From Global to Local
Westminster’s Town Centre Hierarchy genuinely caters for all retail needs and markets. The International Shopping Centres in the West End cater for comparison shopping needs(durable goods where customers compare prices and type of product with other similar products in other shops), alongside Mayfair and St James’s, which covers a range of international niche markets including high end fashion, jewellery and art. Soho and Covent Garden compliment this, offering a different range of retailers. Outside of the central area there are a range of high street style centres serving residential catchment areas, with smaller local centres serving immediate convenience shopping needs (basic goods used on a daily/weekly basis such as food, newsagents products etc) for residents.
The retail sector is a key employer in Westminster, with an estimated 6,800 shops employing around 60,000 people (Experian 2012)
12 TOWN CENTRE PROFILES AND PERFORMANCE
West End Monitoring Performance: Town Centre Health Checks
Sales in the West End up year on year by 9.4% in May 2013.
Westminster undertakes town centre health checks every five years in accordance with national and London Plan policy to monitor their performance and identify issues and the need for interventions.
Spend: The West End is the single biggest destination for comparison retail spend in the UK, with £2.6 billion in 2011
(Experian, 2013). The second largest area is Westfield London at £460 million.
Westminster in total accounts for £3.4 billion of comparison retail spend (61% from residents, 6% from commuters, 33% from tourists), the highest of any borough, with Kensington centres in Westminster.
Chelsea second with £1.2 bn (Experian, 2013).
Westminster’s High Streets and District Centres: Health Checks were undertaken in Spring/Summer 2013 for ten high street type neighbourhood The most recent analysis suggests that the unit vacancy rate has decreased in all of the seven former district centres over the past few years, and that the amount of A1 frontage has increased in five of the seven centres, illustrating the relative health of retail in Westminster.
Footfall: 21.5million visitors to the West End in May 2013, 13.4 million on Oxford Street alone (NWEC, 2013).
Health checks were previously undertaken in 2007 for the 7 high streets formerly known as District Centres, when three centres were described as being ‘healthy’, three as ‘neutral’, and one as being ‘in decline’. This will be compared to the studies currently being undertaken.
Local Centre Health Checks were last carried out in 2008 and are also currently being updated. In 2008, 16 centres were classified as being
‘healthy’, a further 16 were ‘neutral’, and seven were ‘in decline’. This represented a slight overall improvement from the previous surveys in 2002.
Unit Vacancy: Has fallen in the CAZ, and currently stands at
2.1% of units on Bond St, 5% on Oxford St East (due to redevelopments and Crossrail), 0.8% on Oxford St West, 2% on
Regent St, 0% on Victoria St. UK average is 16.2% (Colliers,
2013).
“Market outlook...Central
“Central London will continue
London remains a separate entity when compared to the rest of the UK”
Central London Retail Health Check,
Colliers International (2013)
13 to be buoyed by its high-end and luxury retail offer.”
Rents: Continue to rise in the West End, with a national record rent of £1500 psf recently signed/secured on Old Bond Street
(see next page).
Central London Retail Health Check,
Colliers International (2013) LONDON AND WESTMINSTER RETAIL MARKET (CBRE, 2013)
Global Retail Rents (CBRE Q1 2013)
1. Hong Kong ($4,328 per sqft/annum)
2. New York ($2,970)
•London West End prime rents defied downturn, experiencing 43% growth
2008-2012.
3. London ($1,053)
•International factors are particularly important to the West End retail market (exchange rates, GDP).
International Brand Presence (CBRE, 2013)
1. London (55.5% of top international retailers with presence in city)
• Competition for space from international brands and limited scope for new supply, which directly affects rents (lower supply = higher rent).
2. Dubai (53.8% of retailers)
3. Paris (44.2% of retailers)
Spill over from international streets
Limited availability for retail space and demand for brand presence in the West
End is leading to spill over from the primary international shopping streets into neighbouring streets (in Mayfair adjacent to Bond Street in particular), with a resultant change in rent levels and the character of these streets.
Examples include Bruton Street
(Temperley), Dover Street (Jimmy Choo,
Alexander McQueen), Mount Street
(Christian Louboutin), Grosvenor Street
(Agent Provocateur).
Mount Street Rent: £185 (2007) has grown to £375 (2013) – zone A per sqft.
14 WHAT ARE WE TRYING TO ACHIEVE FOR ECONOMIC DEVELOPMENT IN
WESTMINSTER?
•Sustainable development – A strategic objective in Westminster’s City Plan: Strategic Policies and the overarching principle and the “golden thread” in the NPPF.
Sustainability
“Despite the down turn, the •Spatial Diversity – economic development in the context of conservation areas, opportunity areas,
West End remains a vital part of London’s strength as a global city and is still inside and outside CAZ, NWEDA and the retail hierarchy.
Diversity
Growth
•Mix of economic uses including type and size, with a range of new and mature companies. attracting a mix of occupiers including financial companies..the mixed-use environment and the • Most economic growth is expected in the Core CAZ, opportunity areas, NWEDA and the Shopping Centres.
Conservation Areas are vital components of what makes the businesses in the area survive.”
•Evidence shows that the mixed use policy approach (commercial and residential) and the historic character of Westminster helped contribute to resilience in the economic downturn.