Predictions for 2012 are for market contraction, likely in response to the continuing eurozone crisis. Some hope is offered for the latter part of the year for new lettings as developments across the city ready for completion in 2013.

The Grade I listed structure, which dates back to the 1790s, carries the Lancaster Canal 664ft across the River Lune at 61ft above the ground. As part of a high profile renovation project, funded by a £1m grant from the Heritage Lottery Fund and money from British Waterways, Stone restored the historic masonry and brickwork on the bridge.

Working alongside infrastructure specialists, May Gurney, the six week project consisted of several facets. The main aspect involved the careful removal of cement-based pointing to internal and external terraces on the bridge. Stone replaced and rebuilt all of the lime mortar and terrace balcony copings which had fallen into disrepair through continued weather damage and the age of the structure.

The balusters, which form the terrace walls, had to be re-fitted and all of the outer plinths of the aqueduct needed to be redressed and re-pointed. All open joins across the full span of the aqueduct were also re-pointed and crack-stitching and gravity grouting were applied to external fissures and stonework.

Stone’s heritage masons removed and replaced all the canal kerbs and re-dressed them to their former state, by hand, using traditional methods. The final part of the project for Stone was to remove all of the vegetation on the aqueduct, which included a licensed herbicide spraying, all of which was completed using specialist rope access.

Family-run Stone, which has offices in Darlington, Stockport, central London and Middlesex, are experts in the area of bridge repairs and refurbishments, completing a range of works such as concrete repairs, emergency making-safe repairs, upgrading and general maintenance and thermal imaging surveys for organisations such as English Heritage and British Waterways.

Managing director, Dave Stone said: “The Lune Aqueduct is a real masterpiece and is often referred to as one of the ‘wonders of the waterways’. Due to its age it has fallen into disrepair so we’re working to preserve its historic features and also improving public access. Bridges are one of our growth areas as we have the industry-accredited craftsmen and the necessary public safety requirements readily available, working to install safety barriers and a specialist access systems, where required.”

The Grade I listed building is situated close to Trafalgar Square and at the top of The Mall and offers 13,685 sqm across eight levels. Commissioned by Edward VII and finished in 1912, the archway was once the accommodation for high ranking naval officers. More recently is has been used by the Cabinet Office and the Ministry of Defence.

Explaining the reasons for bringing the building to market, Robert Seabrook, director of marketing agent Savills, said: “The objectives are to respect and protect the heritage of the building now and in the future, enable the potential for public access, ensure awareness of any potential security implications and to maximise value for the taxpayer”.

The leasehold for the building is expected to be worth £75m, with speculation that the arch could be turned into for either a restaurant, hotel or art gallery.

Current owners, Real Estate Opportunities, failed to secure the required £300m to finance the redevelopment project and stave off outstanding debt that was due for repayment in August. Ernst & Young have now been appointed as administrators. Its is understood that the Battersea site will be put on the open market with REO having no further involvement in the project.

The set back comes just days after the Government announced part- funding towards an extension of the Northern Line to the Battersea site; an infrastructure project considered vital for the survival of the site. REO have to date spent five years and £50m securing the required planning permissions to move forward with a proposed £5.5bn regeneration of the former power station and surrounding area.

Several parties have already shown interest in the 38-acre Battersea site, considered one of London’s last available prime development spots, though the mandatory contribution of £200m towards the extension of the Northern Line remains a sticking point. A new development on the site will generate as many as 25,000 new jobs it is hoped.

The DJD findings show central London overall is managing to tick over. Here, 7.2m sq foot of office space is under construction and commercial development has risen 12 percent in terms of space.

That said, the number of new starts this summer dropped from 25 to 22 and 64 percent of all new starts were significant refurbishments rather than new builds. The problem is that with the stuttering economic environment, exacerbated by the European Union’s apparent inability to get its act together, question marks will still loom ominously over space supply and demand.

Glass half-full people will say economic misery will not last forever and, before long, demand for space will bounce back as London attracts investment from all over the world, including that increasing force to be reckoned with – China.

By that stage we will hopefully operate in an environment in which “yes” is the default answer to “sustainable” planning applications – some may say whatever that is – if the National Trust, the Campaign for Rural England and their ilk do not win the day in the ongoing battle against the draft National Planning Policy Framework.

Osborne’s Autumn Statement included a fair amount of infrastructure and planning announcements which, even if much was left out, at least demonstrates the government seeing development as one of the crucial building blocks for economic recovery. Osborne did miss a trick with Enterprise Zones and could have done far, far more here to encourage new growth.

Empty promises
The ongoing refusal to budge on taxing empty property is, frankly, a complete counter to the chancellor’s stated objective to stimulate a prolonged recovery after a testing few years for the property industry.

Michael Marx, chief executive of Development Securities (DevSec), notes the City’s office stock has experienced its “fair share of pain” as capital values plummeted by half between 2007 and 2009. Despite a subsequent recovery, such properties remain 37 percent below their pre-crisis values.

DevSec’s latest ‘Who Owns the City’ report says foreign ownership of City of London offices now stands at 52 percent compared with just 10 percent in 1980. And an encouraging dynamic is that London attracts more office inward investment than any other city and overseas buyers remain focused on prime City assets, despite the lower capital values.

Estates Review is convinced that when the good times start rolling – and they will – the City of London’s status as Europe’s pre-eminent financial centre will continue to attract huge investment both from overseas and at home. Looking through a long lens, there is plenty to be hopeful for in the City when it comes to office development and investment.

Street fight
Were only that the case for high streets where we say, again, draconian parking regulations and exorbitant parking charges are killing retailers. Ryman’s owner, Theo Paphitis, concurred in The Independent on the day of the Autumn Statement when he said the expansion of parking restrictions, “not just in Westminster, but in many towns” was “ludicrous”.

Mary Portas’s review of town centres is thought to have been delayed yet again at a time when change is needed sooner, not later otherwise more and more of our high streets will be boarded up and the erosion of capital values will be felt for miles around. However, commercial property will continue to shine for the long term. You only need to read through Estate’s Gazette’s Rich List 2011 for proof of this.

The top 250 are worth £87bn – up £15bn on last year with the likes of the Rebuens, Barclays, John Whittaker and new entrant, Enesto Bertarelli more than cutting the mustard. So in these straitened times, let us not loose sight of the pot of gold at the end of a very long rainbow. We just have to hold our nerve.

In spite of the positive figures, only around 443,000 sq ft of new space is due to be delivered during 2012, representing the lowest levels of new development in a decade.

“The next 24 months no longer looks as devoid of delivery as it has over the last few surveys, however, delivery of new space remains low compared to historic levels,” said Anthony Duggan, partner and head of research at Drivers Jonas Deloitte.

“The question now is whether the market needs this new space given the weakening economic environment.  The answer, as always, will depend on location and size of the schemes being delivered.”

Of new developments, 64 percent are renovations and refurbishments over new builds. This indicates that developers are keen to get space to market to fill the deficit of Grade A space developing in the City and the West End.

The numbers paint a picture of an industry where 34 percent of commercial developers surveyed experienced a fall in activity over the past month, while only 17 percent experienced a rise. Moreover 28 percent expected the situation to continue in a downward trend for the next three months.

Though falls have been experienced across the commercial development industry, the recent contraction in activity has been compounded by the significant fall in public sector development where government works contracts are now becoming scarce.

Kingsgate House is the latest in a line of projects that Land Securities have undertaken in the Victoria area that stand to improve the area. “Victoria is changing. We began our transformation of the area with Cardinal Place and we are already on site at three other schemes. Kingsgate House is another key stage in our plans to create the new West End destination,” said Colette O’Shea, Head of Development for Land Securities’ London Portfolio.

Redevelopment of Kingsgate House is currently pitched for the spring of 2012, with a subsequent completion date expected for the summer of 2015.

Currently a mix of residential, retail and office space, it has been speculated that Frogmore will seek permission to convert all the space to residential.

Built in 1966, Centre Point was acquired from administrators by Almacantar in April 2011 for £120m. Short-term net income on the building has increased by 17 percent since then.

The building is expected to benefit from the completion of the £1bn redevelopment of Tottenham Court Road tube station and the associated regeneration of Oxford Street.

CEBR’s latest prediction comes against the backdrop of the prospect of tougher regulation resulting from the Vickers banking report and the impact of the eurozone turmoil, despite the latest debt deal which includes the European Union and the International Monetary Fund bailing out Greece to the tune of €130bn (£114bn).

Figures from Colliers International in mid-October showed 65 percent of space completing in 2011 in the City market still remained vacant, compared with the west end market, where 75 percent of space completed so far this year was either let or under offer.

Taking the plunge
Yet, there is still plenty of developer action in the City, Derwent London, for example has just won consent to redevelop its City Road estate at a cost of £105m which will include 271,000 sq ft of offices as well as retail and residential elements. Land Securities also secured resolution to grant planning permission for a development on the corner of Shoe Lane and Little New Street – 1 New Street Square. This will include about 250,000 sq ft of offices and shops.

Still, it does not take Einstein to work out that fewer jobs means less demand, which means surplus space. That said, economic predictions should be taken with a pinch of salt. They only present a snap shot based on what is happening at any one time – a bit like Back to the Future, where outcomes change according to the type, and number, of stones thrown into the pond.

The global and European economic situation is fluid despite the latest eurozone debt deal which, still looks like a sticking plaster to cover a wound that needs both a splint and a bandage and is, once again, more of a time-buyer than a permanent fix. But do not abandon the cement just yet. Despite what the sceptics say, the City will continue to be hot property for global finance. It is easy to react timidly to short-to-medium-term issues and forget the long-term bigger picture, which is just what pension advisers are telling their clients at the moment: hold steady, keep plugging away with investment and, short of nuclear Armageddon, a comet wiping out all known life or a global pandemic, it will all come good. Short-termists are dead in the water. Long-termists will reap the rewards.

Busy winter
Elsewhere, in town centres, landlords are going to have their work cut out for them if latest analysts’ warning of a rash of retail insolvencies and restructurings after Christmas and well into next year transpire.

This ought to keep property agents busy and provide opportunities for established stronger chains to cherry-pick the best assets, no doubt at knock down prices. It’s been evident in the last few months that high streets previously regarded as insulated are now showing the early signs of decay.

Where one closure gave way to a new opening for another operator, more and more shop fronts are boarded up even in the some relatively affluent north London town centres. It is a mess but much like the churn you get in the pub sector the fittest will survive, the chaff will, at worst, lie empty for a while, be converted, or be snapped up by those with bigger purse strings, a better strategy or the enthusiasm to create a better business.

At least with property, the owners have bricks and mortar at the end of the day, regardless of the health of the business that occupies it, unlike equities where you can be left with nothing. With bricks and mortar, even if the place burns down, there’s still the insurance.
With shares you can end up with zilch.