Industrial Capacity

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Industrial Capacity

The London Plan

(Spatial Development Strategy for Greater London)

Draft Supplementary Planning Guidance

September 2003


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Industrial Capacity

The London Plan(Spatial Development Strategy for Greater London)

Draft Supplementary Planning Guidance

September 2003


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The Mayors Supplementary Planning Guidance Industrial Capacity

Contents

SUMMARY......................................................................................................................2

1 INTRODUCTION...............................................................................................................42 BACKGROUND................................................................................................................. 43 POLICY CONTEXT............................................................................................................64 SPG OBJECTIVES.............................................................................................................85 CHANGING INDUSTRIAL DEMAND AND THE PLAN, MONITOR AND MANAGE

APPROACH.................................................................................................................... 106 THE STRATEGIC EMPLOYMENT LOCATIONS FRAMEWORK AND OTHER INDUSTRIAL

PROVISION.................................................................................................................... 137

INDUSTRIAL CAPACITY AND MIXED USE DEVELOPMENT...........................................18

8 QUALITY AND VARIETY OF INDUSTRIAL CAPACITY .................................................... 199 SMALL INDUSTRIAL ENTERPRISES............................................................................... 2110 STORAGE AND DISTRIBUTION......................................................................................23ANNEXES......................................................................................................................24 Annex 1: INDUSTRIAL LAND DEMAND AND SUPPLY TRENDS ...........................................24Annex 2: STRATEGIC EMPLOYMENT LOCATIONS FRAMEWORK ........................................29Annex 3: REFERENCES..........................................................................................................32Index of Draft SPG Implementation PointsPolicy 3B.6 of the DLP sets out the general approach to provision for industry:.....................6SPG 1 Industrial Capacity and Demand: the Plan, Monitor and Manage Approach ............12SPG 2 Strategic Employment Locations Framework ...........................................................13SPG 3 Locally Significant Industrial Sites............................................................................14SPG 4 Other Industrial Sites ...............................................................................................15SPG 5 Industrial Capacity and Mixed Use Development .....................................................19SPG 6 Quality and Variety of Industrial Capacity ................................................................21SPG 7 Small Industrial Enterprises ......................................................................................22SPG 8 Storage and distribution ..........................................................................................23

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Industrial Capacity The Mayors Supplementary Planning Guidance

SUMMARY

The long term decline in Londons manufacturing industries is abating, falling from an annualaverage of 24,000 jobs over the last 30 years to an expected 5,000 jobs pa to 2016. Amodest resurgence in warehousing employment is anticipated, reversing the historic 1,500

jobs pa decline to an increase of nearly 1,000 pa. While the Standard Industrial Classes formanufacturing and wholesale distribution employment do not cover all potential occupiers ofindustrial land, used with other indicators they provide a reasonable proxy for industrialdemand. On past trends, these together suggest that there could be churning annualdemand for 55 ha of industrial land pa set in the context of a long term reduction in demandapproximating to 30 50 ha pa.

In line with PPG 12 this Supplementary Planning Guidance (SPG) does not propose newpolicies but supplements those of the draft London Plan (DLP) to:

ensure that there is an adequate stock of industrial employment capacity to meet

the future needs of different types of industry in different parts of London,including that for good quality and affordable space.

plan, monitor and manage the release of genuinely surplus industrial land so thatit can better contribute to strategic and local planning objectives, especiallythose to provide more housing and particularly affordable housing. Inappropriate locations where it can contribute to town centre renewal, offices,leisure and retailing as well as high density housing will be appropriate. However,out- of- centre retail and leisure uses will continue to be strongly resisted.

There are some 7,000 ha of industrial land in London. Subject to regular review of changingdemand and supply, this SPG and the DLP reaffirm the effective historic policy to sustain the

strategic reservoir of industrial capacity (4,400 ha) in designated Strategic EmploymentLocations (SELs). More than two thirds of this will be protected as Preferred IndustrialLocations (PILs) to meet the needs of industries which, to be competitive, do not place ahigh premium on an attractive environment, though they may need infrastructure and othersorts of improvements. The remainder will be protected in Industrial Business Parks (IBPs)offering a higher quality environment.

Drawing on a range of DLP and national policies, the SPG encourages owners and occupiersof industrial land, as well as the LDA, boroughs and other relevant agencies, to manage andinvest in this capacity to meet the changing needs of different types of industry. To supportthis, mixed use, higher density re-development of some Strategic Employment Locations

close to town centres and public transport nodes is encouraged providing it does notcompromise DLP policy 3B.6 and capacity to meet Londons future industrial needs. Toensure that proposed alterations to national policy on industrial land use change areeffectively coordinated in London, the SPG also provides guidance to Boroughs onidentifying in Sub Regional Development Frameworks those SELs, or parts of SELs, whichcould be consolidated through the first review of the London Plan. Neither intensificationnor consolidation should lead to a net loss of capacity to accommodate industrialemployment or compromise strategic and local housing policies. Such development mustfulfil stringent design criteria to secure a harmonious mix of activities and a safe, attractiveenvironment for all uses.

The SPG supports boroughs in identifying and protecting locally important industrial areas

outside the SEL framework providing their UDPs demonstrate that this is justified bydemand. Most of the change in the industrial stock will therefore take place among the

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remaining sites outside the SEL and UDP frameworks. The SPG recognises that cumulativelythese will still be strategically as well as locally important for industry. It therefore providesgeographically sensitive, strategic, local and market based guidelines to be refined byboroughs to manage the supply of these sites in the light of local circumstances anddemands. The SPG also provides guidance on enhancing the quality and variety of industrial

provision and to meet the specific needs of small firms and warehousing.

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1 INTRODUCTION

1.1 The draft London Plan (DLP) recognises that though manufacturing industry andwholesale distribution are relatively small sectors, they have a significant role in the

London economy. They are also experiencing considerable change. The DLP outlinesthe contribution these sectors can make to achieve its wider objectives. In Policy 3B.6it promotes Strategic Employment Locations (SELs) as Londons strategic reservoir ofindustrial development capacity to accommodate industry and other activities withsimilar land use needs and requires boroughs to manage the protection, release orenhancement of sites outside the SELs.

1.2 Drawing on the procedures and substantive issues addressed by national guidance,this SPG details the broad policies and principles in the DLP which bear on provisionfor industry but does not propose new policy. The national procedural context forthe SPG is set by PPG12 and the more substantive, national policy context byPPGs 1, 3, 4, 11, RPG 9 and Circular 1/2000 as well as the wider urban renaissanceagenda outlined in Our Towns and Cities: the Future and the SustainableCommunities Delivering Through Planning. An SPG is a material planningconsideration. It will inform the Mayors planning decisions and should be taken intoaccount by boroughs and other agencies concerned with the use and enhancement ofLondons industrial land.

2 BACKGROUND

2.1 Historically, industrial capacity was used mainly to accommodate the manufacturingand wholesale distribution sectors. In the last 30 years manufacturing has changedfrom providing over a fifth of Londons employment to the point where it accounts

now for only 7%. This loss of nearly three quarters of a million jobs was the singlemost important reason why, until relatively recently, overall employment in Londondeclined. However, by the mid 1990s the decline in manufacturing employment hadabated. While long term growth is not expected in the future, neither is it anticipatedthat the historic rate of decline will resume. Consultants Volterra forecast a loss of82,000 jobs from the 2000 total of 328,0001. The anticipated rate of decline inmanufacturing is due not so much to an expected renaissance in the sector as areflection of there now being so fewer jobs to be lost.

2.2 The reasons for the historic decline reflect macro economic factors exacerbated inLondon by higher costs and competing land uses. However, the process of change

also entailed some restructuring among the industries which still find London acompetitive location. This is partly because of accessibility to a regional market whichis uniquely large, wealthy and compact. It also reflects innovation, changingtechniques and specialisation as industries move towards the production of highervalue goods or become more closely associated with services e.g. through anemphasis on research, catering or the leisure market.

2.3 Traditional distinctions between production, assembly, distribution and office-basedactivities in the manufacturing sector are breaking down. Only about six in ten ofthose employed in Londons manufacturing sector work at establishments whose

main function is manufacturing activity2. The flexibility in the Use Classes and

General Development Orders supports this. In the past such flexibility gave rise toconcern that land would change from low value industrial to high value office uses to

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the extent that industrial capacity in London would be compromised. However, whilethis was once the case in some areas, more sustained sources of loss have been toretailing and housing.

2.4 Productivity in manufacturing is now above that in some service industries, its

contribution to Londons GDP is disproportionately high (11% of the total, thoughthis is partly a reflection of the way in which statistics are recorded) and it is the

second most important source of exports from the capital3. The EconomicDevelopment Strategy highlights a range of sub-sectors with particular growthpotential and needs (seeparagraph 8.2 of this SPG).

2.5 Although a smaller employer than manufacturing, wholesale distribution has been lesssusceptible to decline. Employment increased slightly from the mid 1990s to 275,000in 2000 and is forecast to expand by 14,000 by 2016. The nature of wholesaledistribution has changed considerably over the last 30 years as logistics have becomemore sophisticated in response to global trends and to meet the needs of the largeand complex London market. The industry is particularly affected by customerconcerns for just in time delivery and those of the wider public for theenvironmental impact of freight distribution.

2.6 Historic policy approaches to warehouse provision have been coloured by itsemployment densities. However, some wholesale distribution employment densitiescan approach those of some manufacturing industries, especially when associatedwith related assembly, packaging or office employment. More importantly,distribution serving a city region of over seven million people performs a vitaleconomic function as well as providing modern, economically sustainableemployment opportunities. In the right location and especially when associated withappropriate transport management and inter-modal transfer arrangements, it can also

contribute to broader sustainability objectives. Guidelines on the relationshipbetween transport and freight are set out in the Transport Strategy as well as theDLP. Supplementary Planning Guidance, complementary to this SPG and informingDLP Policy 3.C3 will be produced to address the land use and environmentalimplications of new and improved transport provision. This SPG will also complementthe Mayors proposals to safeguard wharves on the River Thames4.

2.7 Definitional issues are raised in addressing both the demand and supply of industrialland. On the land supply side, the B1(b), B1(c), B2 and B8 Use Classes do not includeall potential users of industrial land. Conversely, some of these classes canaccommodate what are essentially office based rather than production activities.

Moreover, the General Development Order allows changes between these uses andpure offices (B1(a)). The Strategic Employment Locations framework outlined inAnnex 2 and Figure 1 seeks to accommodate industries of different types,recognizing that they will have different spatial and environmental requirements. Onthe demand side, the manufacturing and wholesale distribution Standard IndustrialCategories (SICs) exclude activities which occupy industrial land. Conversely, theyinclude others which are highly unlikely to occupy such land e.g. larger firms incentral London classified as manufacturing but which are probably headquartersoffices. The consensus among the demand side studies cited in paragraph 2.6 ofAnnex 1 suggests that these SICs are reasonable, pragmatic proxies for overallindustrial demand.

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2.8 Background justification for this SPG, including some material which updates thatwhich informed preparation of the draft London Plan, is set out in Annex 1.

3 POLICY CONTEXT

3.1 Dated, national guidance (PPG 4) has been refined over time to address the uniqueissues facing provision for industry in London5. The DLP builds on these refinements.It too recognises that long term industrial decline has left London with both anoverall surplus of industrial development capacity and, in some places, a shortage ofaffordable provision of different types for firms which still find London a competitiveindustrial location. Even more than in the country as a whole, small businessesdominate the industrial sector in London. Improving quality of provision remains akey concern but there is also a need for yard and shed based, lower order activities.The DLP refines the established policy distinction between local and strategicindustrial capacity. More generally, the DLP underscores the importance to London of

national policy (PPG 1, 3, 11, 12 and RPG 9) to review non-housing allocations andconsider whether some might be better used for housing or mixed use development,to intensify development in appropriate locations, to coordinate economicdevelopment and planning activities and to foster mixed-use development.

3.2 This SPG is supported by recent statements by the Chancellor and the Office of theDeputy Prime Minister. In general terms, government will propose that localauthorities should allow land allocated for industrial or commercial use in theirdevelopment plans, and redundant buildings, to be used for housing or mixed usedevelopment unless a convincing case for retention can be made6. More specifically,it will seek expeditious and sympathetic handling of planning proposals whichconcern land allocated for industrial or commercial use but which is no longer neededfor such use7. Government proposes that boroughs should consider such planningapplications favourably unless they compromise PPG 3, RPG or up to-datedevelopment plan policies. There is particular concern that such proposals should notlead to over supply of housing (very unlikely in London) and that they should notundermine demonstrable, realistic prospects of land being taken up forindustry/commerce or regional and local strategies for economic development andregeneration.

Policy 3B.6 of the DLP sets out the general approach to provisionfor industry:

With the LDA, boroughs and other relevant partners the Mayor willpromote and manage the varied industrial offer of the StrategicEmployment Locations (SEL) set out in Map 3B.1 and the StrategicEmployment Locations Annex as Londons strategic reservoir ofindustrial capacity

Boroughs should identify SELs in UDPs, and develop local criteria tomanage the protection, release or enhancement of industrial sitesoutside the SELs, taking account of the strategic criteria set out in

Supplementary Guidance.

3.3 The DLP notes the links between manufacturing and other sectors, the relative

dynamics between manufacturing and wholesale distribution employment andhighlights the scope for growth in high value added and design led manufacturing. It

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outlines the scale of industrial capacity in London (6,900 ha), cites the estimate ofindustrial land release expected at the time the DLP was prepared (32 ha pa) andnotes that because of constraints on the quality, availability and nature of currentsupply, there may be local shortfalls in quality modern floorspace and readily availabledevelopment land, particularly in parts of West and South London. This puts a

premium on integrated action by the LDA and other relevant agencies to bringforward the most attractive sites at a time when the planning process must manageselective release of strategically surplus capacity to other uses paragraph 3B.31. Toprotect land for industry, the Mayor will promote the Strategic Employment Locationsframework to reconcile demand and supply and take account of industrys needs interms of clustering, capacity, environment, accessibility and cost requirementsthrough two basic types of location Industrial Business Parks and Preferred IndustrialLocations.

3.4 This SPG refines these industry specific and, where relevant, more general DLP policythemes for application to industrial provision in London. It reflects not just industrialobjectives but also the broader concerns of the DLP. Of particular relevance is theneed to foster more sustainable forms of development (especially DLP Policies 3C.1,4A.14, 4B.1, 4B.3, 4 B.7, BR16 18) and to meet the challenges of economic andpopulation growth, especially the need for additional housing (DLP Policies 3A.1, 2,5). Thus, industrial land policy seeks a closer relationship between public transportaccessibility and the need to secure more efficient use of development capacity andgreater diversity of land uses. This does not mean that the sequential test can bewaived for out of centre leisure and retail facilities proposed on industrial areas(DLP Policy 3D.2). However, it can mean that redevelopment of industrial sites inappropriate locations can accommodate work space, housing and some otheractivities providing that an attractive and safe environment can be created for all,that there is no net loss in industrial employment capacity (DLP Policies 3B.6, 4B.1)

and that the thrust of the key industrial policy (3B.6) is not compromised.

3.5 The SPG acknowledges that strategic policy cannot and should not cover isolatedsmall sites specifically this must be a borough matter. Strategic policy guidance can,however, provide criteria for refinement at local level to guide their development inthe light of local circumstances. The main thrust of strategic policy must beconcerned for the overall relationship between industrial demand and supply and withthe main concentrations of industrial development capacity.

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Figure 1 Strategic Employment Locations (London Plan Map 3B.1)


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3.6 The larger concentrations, called Strategic Employment Locations (SEL) in the DLP,are mostly over 20 ha in size. However, in some areas, especially parts of West andSouth London (see paragraph 6.11), where there is particular pressure on industrialland, smaller sites e.g. of 10 ha, can be of strategic importance. To meet the needs of

different types of industries, the SELs are divided into two groups:

Preferred Industrial Locations (PILs), which are suitable for firms which donot place a high premium on environmental quality. These usually fall within theB1 (c), B2 and B 8 Use Classes. PILs will not normally be suitable for B1(a) andB1(b) uses, although some ancillary B1(a) use is acceptable and some transferbetween these classes may be inevitable under the General Development Order.PILs will not normally be suitable locations for large scale B1(a) officedevelopment. Nevertheless, they may be appropriate for other uses of anindustrial nature, including some of those classified as sui generis e.g. carbreaking, metal re-cycling, aggregate processing, bus garages, iron and steel

pre-fabrication. However, this cannot be taken as a general policy position, notleast because, by their nature, sui generis uses must be treated on their merits.

Industrial Business Parks (IBPs) are for firms which need better qualitysurroundings. These are usually B1 (b), B1 (c) and high value added B2 activities,require significantly less heavy goods access and are able to relate moreharmoniously with neighbouring uses than those in PILs. IBPs are not intendedfor primarily B1(a) office development. Where B1(a) office development isproposed on an Industrial Business Park, this should not jeopardise localprovision for B1(b) and B1(c) accommodation, where there is demand for theseuses. Any B1(a) proposal, including redevelopment of existing offices, shouldcomply with the DLPs office policies, particularly in terms of location and public

transport access. Proposals for science and technology parks are addressed byDLP policy 3B.4

3.7 The management regimes, regeneration needs, branding and offer of each categorydiffer and there are usually differences in road access, public transport andinfrastructure requirements, especially for locations with a strong wholesaledistribution function.

3.8 Historic strategic planning policy has been concerned primarily to protect alldesignated SEL from pressures for change to other uses. In this it has been largely

successful8. Though the revised SEL framework in the DLP represents a slightcontraction (3%) on the original to reflect changing market conditions, most of the

historic change from industrial to other uses has been among smaller sites outside theSEL framework. Historically, these were subject to relatively crude, criteria based,strategic policies, which were supposed to be refined for local application. Throughthe DLP this SPG introduces more sensitive criteria and the Mayors UDPconformance powers enables them to be implemented more consistently.

4 SPG OBJECTIVES

4.1 The objectives of this SPG are to supplement and to provide detailed guidance as tohow the broad policies of the DLP should manage industrial development capacity. Inparticular, the SPG seeks to:

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ensure that sufficient land is available to meet future industrial needs, includingthose of existing firms, and

bring genuinely surplus industrial land back into more active uses to meet thewider objectives of the DLP, especially those to meet housing and other needs.

4.2 To do this the SPG refines the DLPs policies and national guidance to:

provide a geographical framework for the LDA and other partners to identify andpromote the supply of sites of appropriate quality needed by different occupiers,as well as guiding the release of surplus land for other uses. In general, andsubject to local refinements, this will entail retaining much of the capacity inWest and parts of Central and South London and carefully managing the releaseof surplus capacity elsewhere, especially in East London;

support partnership working, to provide choice and flexibility to meet therequirements of different types of developer and occupier, including small andmedium sized enterprises (SMEs) and to provide strategic support through the

planning system for protection of the best industrial land sufficient to meetdemand;

manage pressures for changes from industrial to other land uses in differenttypes of location, including protection of small, locally viable industrial sites;

more closely reconcile the relationship between demand and supply of industrialland. In the longer term, this will entail bringing the rate of change in industrialcapacity closer to that of employment possibly reducing the rate of industrialland loss to half to two thirds of that recorded during the early 1990s.

promote realistic, balanced land-use policies including release of land for other

purposes where there is no demonstrable demand for continued industrial use.promote a sub-regional approach to industrial land policy, with boroughs co-ordinating policy and economic development initiatives;

apply national and London-wide urban renaissance principles to encourage moresustainable use of industrial land by fostering higher density and, whereappropriate, a wider mix of uses where these are mutually compatible and canproduce a good quality environment and sustain or enhance provision forbusiness.

encourage planning and design to achieve better integration of industrial areasinto the fabric of the city, resolving tensions between uses and enhancing the

security and permeability of industrial areas for walkers and cyclists as well asbusiness.

promote active management of the stock of industrial land and monitoring ofindustrial demand and supply to inform strategic and local policy;

contribute to an ongoing review of the overall geographical framework forstrategic and local planning policy across London in the light of changing markettrends.

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5 CHANGING INDUSTRIAL DEMAND AND THE PLAN, MONITOR ANDMANAGE APPROACH

5.1 This SPG has been designed around government and the draft London Plansapproach to planning, monitoring and managing development.

5.2 Plan: The planning element of this trinity has three main components:

the strategic reservoir of industrial land a resource which must be sustained forthe short to medium term but nevertheless must itself be subject to periodicreview to reconcile demand and supply in the longer term.

locally significant reserves of land, protection of which needs to be justified on asub-regional basis.

smaller sites which historically have been particularly susceptible to change. Insome circumstances they can better meet the DLPs objectives in new uses but in

others will have a continuing local and strategic role as industry. They willcontinue to be the areas of greatest change.

5.3 The SPG also contains specific guidance on mixed development, the quality andvariety of industrial development and specific provision for small and medium sizedenterprises and storage and distribution.

5.4 Monitor: Sensitive and authoritative monitoring has a crucial role to play in asituation where overall land supply in London is finite, competing demands on it arestrong and policy has to help sustain a sector which historically faced long termstructural decline but which now appears to be consolidating and for which there isstill strategic over-provision. In such dynamic circumstances, timely information isessential to inform the management of land and keep policy responsive to changes inthe relationships between these factors.

5.5 To understand the balance between the three main components of the SPG outlinedin paragraph 5.2, their differing susceptibilities to change and the geographicalvariations in these differences requires data on different temporal and spatial scales.At the broadest geographical scale, it is necessary to know that for the medium tolong term industrial demand across London is continuing to decline sufficiently to

justify release of 30 50 ha pa (Annex 2 2.6-2.8). Indicative sub regionaldistributions of these figures are shown in Annex 1, Table 2. Similarly, it will beessential to check that within this trend, there is continuing churning demand for

55 ha pa for new development. These will be key monitoring benchmarks. To testthem locally and strategically will require a robust understanding of both demand andsupply, particularly outside the SELs where, according to policy, most of the changeshould be taking place.

5.6 For the SPG to be robust in the face of challenge, borough and strategic monitoringsystems must demonstrate that policy is working as anticipated. This is likely to entailpooling monitoring resources and information on a sub-regional basis.

5.7 Appropriate sub-regional and borough-level benchmarks to inform policy forindustrial land could include:

Overall stock of industrial land and premises

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Gross new industrial completions;

Gross take-up of industrial land and premises;

Industrial property changes of use and demolitions;

Supply of vacant industrial land and premises;

Industrial rental values, land values, yields and market perceptions

Businesses demands.

5.8 Just as the most recent review led to a 3% reduction in overall area covered by theSEL framework and informed boroughs in the approach to be taken to futureprovision, cumulative assessment of the changes suggested by these monitoringindicators will inform longer term reviews of the core SEL and local industrialcapacity. Preparation of Sub Regional Development Frameworks will provide anopportunity to identify strategically important changes to the SEL so that they can beaddressed in the review of the London Plan (see paragraph 5.12-5.14). Informed by

the criteria in paragraphs 6.9 6.15, Boroughs will be expected to follow a similarcourse in their UDP reviews.

5.9 Manage: Research into industrial land demand has stressed the need for activemanagement in order to improve quality, meet the continually changing needs ofoccupiers, and deal with excessive industrial vacancy. The following guidelines areintended to move towards a strategic framework for the active management ofindustrial land in London. Guidance on interpretation of the DLPs approach tomanaging the transfer of surplus industrial land to other uses, mixed-usedevelopment, the quality of development and provision for smaller firms is set out inparagraphs 6.1 10.2.

5.10 Land should be managed to support national and GLA group objectives for business.In line with PPGs 11 and 12 and the White Paper Our Competitive Future, the DLPis integrated with the Mayors Economic Development, Transport and otherStrategies and relevant GLA initiatives such as that to secure efficient e-infrastructure. Both the DLP and this SPG complement the Economic DevelopmentStrategy (EDS) through support for clusters of related activities by protectingstrategically important business locations and ensuring that clustering is a key factorto be taken into account when managing release of surplus industrial land outsidethese locations. The EDS seeks to respond to the needs of businesses, includingSMEs, through business support, training, innovation and through specificregeneration initiatives which have both spatial and sectoral priorities e.g. for creative

industries. They will complement the DLPs intention to secure mixed-usedevelopment, including affordable business space, through planning agreements. TheEDS also details the principles of the DLP by recognising and addressing therelationship between SMEs and Black and Minority Ethnic and local communityenterprise opportunities.

5.11 The DLP and Transport Strategy address the parking and other transport needs ofSMEs within the context of those of London as a whole. This includes workingtowards implementation of a coordinated level playing field for parking provisionwith local authorities adjacent to London.

5.12 In managing and reviewing industrial capacity, including SELs, account should betaken of the scope for consolidating industrial capacity at particularly appropriate

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locations. Consolidation of SELs, or parts of SELs, is not a policy requirement of theDLP and this SPG does not seek to introduce new policy. However, in light of

governments recent proposals9 to stimulate a more active approach to releasingsurplus industrial land, especially for housing, this SPG flags the need to begin work

which will lead to a review of the SEL framework when the London Plan is revised.SELs and parts of SELs which can be consolidated to support national policy shouldbe first suggested in Sub Regional Development Frameworks. This exercise must becoordinated strategically (and structured to minimise hope value) taking account oftransport and regeneration as well as planning objectives to ensure that Londonsoverall future industrial needs are addressed. It is part of the managementrequirement set out in the DLP (paragraph 3B.30).

5.13 Consolidation must be informed by an authoritative appreciation of short and longerterm market and policy requirements (see paragraphs 6.9 15). It must also be castin the context of robust and sensitive relocation arrangements, which ensure that

London jobs, and Londoners access to them, are not compromised. Land released asa result of such consolidation exercises, like that which may be released as a result ofthe proposed industrial expansion of London Riverside to serve the Gateway area,must be re-cycled to meet strategic as well as local priorities. Re-use for housing andancillary activities will be the key priority. Borough experience has shown that withproper planning and management procedures and given the link between population

and employment, new housing is not necessarily the enemy of jobs10. In exceptionalcircumstances, strategically coordinated, earlier releases of land from a SELdesignation may be acceptable for strategic proposals of essential benefit for Londonwhich cannot be planned for or delivered on any other site in Greater London egprovision for the 2012 Olympic games in line with DLP Policy 3D.6.

5.14 This proposal to begin the process of investigating the scope for industrialconsolidation in the context of Sub Regional Development Frameworks and thereview of the London in no way weakens the objective of DLP policy 3B.6 to securean adequate supply of industrial employment capacity. Boroughs, developers andland owners must take this as a clear statement of principle. Attempts to realise hopevalue through proposals for unacceptable alternative development of SELs will bestrongly resisted.

SPG 1 Industrial Capacity and Demand: the Plan, Monitor andManage Approach

In implementing Draft London Plan policy, the Mayor will and the LDA,TfL, boroughs and other partners should:

adopt a positive plan-monitor-manage approach to planning forindustrial land in London to bring demand and supply into closerharmony;

use the Sub Regional Development Frameworks to identify and justifychanges to the SELs so that these can be addressed in the review of theLondon Plan.

co-ordinate monitoring of industrial land and policy development on asub-regional basis;

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manage the stock of industrial premises so that it provides a competitiveoffer for different types of occupier. This will entail both improving thequality of provision to meet users different needs, including those of

SMEs and clusters of related activities and maintaining lower costcapacity or making provision for those requiring affordable business

premises.

initiate a review of the potential to consolidate industry in appropriatelocations and establish effective re-location arrangements in the contextof national and regional policy, especially that to secure capacity tomeet Londons future industrial needs. The GLA group will coordinatethis process as it affects SELs.

6 THE STRATEGIC EMPLOYMENT LOCATIONS FRAMEWORK AND OTHERINDUSTRIAL PROVISION

6.1 Strategic Employment Locations: As an evolving policy construct, the StrategicEmployment Locations Framework has proved a valuable tool in achieving one of theobjectives of this SPG - protecting Londons principal industrial locations. Very littleindustrial land within the SEL Framework has transferred to other land uses since1994. In being so successful, the Framework could run the risk of fossilising land asindustrial when there is no longer demand for this use. However, the requirement tomonitor closely demand and supply relationships outlined above and to review theframework in light of these will keep the framework in tune with market requirementsand broader planning objectives.

6.2 Historic policy towards the SEL Framework was not very successful at improving thequality of industrial sites in these areas. The scope for much more closely integrated

planning, regeneration and transport activity now provided by the GLA group as awhole, coupled with a strong commitment to partnership working will address thishistoric shortcoming.

6.3 If the pan London approach to industrial capacity is to be effective, it must beimplemented and sustained by boroughs consistently. Departures from it will sendconfused messages to developers and tend to increase the hope value of landmaking it uncompetitive for industry or even lead to it being kept vacant and out ofproductive, industrial use. Changes to the SEL framework shown in Figure 1 and inAnnex 2 should therefore only be undertaken in the light of a strategic review ofindustrial demand and supply.

SPG 2 Strategic Employment Locations Framework

In implementing Draft London Plan policy, the Mayor will and the LDA,TfL, boroughs and others partners should:

where relevant in their strategies, Unitary Development and other plans,identify the components of the SEL Framework shown in Figure 1 and

Annex 2 of this SPG.

promote the SELs as the prime locations for industrial activity inLondon.

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through co-ordinated investment, regeneration initiatives, transport andenvironmental improvements and the use of planning agreements,manage the differing offers of PILs and IBPs and provide local planning

guidelines to meet the needs of different types of industry appropriate

to each as indicated in paragraph 3.6.

other than as part of a strategically coordinated process o mixed useintensification (paragraphs 7.1 7.7) development of non-business useswithin the SEL should be resisted except where they provide local, small

scale, walk to services for industrial occupiers e.g. workplace crches.

6.4 In many areas of London smaller industrial sites, which lie outside the SELFramework, can be important in providing local employment and economic diversity.This SPG seeks to protect such sites for industrial activity where they continue tomeet industrial requirements. However, it also recognises that historic policy wasunrealistic in seeking to prevent the transfer to other uses of all industrial land across

whole sub-regions of London. This applies even to parts of South and West Londonand of the fringe of Central London where market reports suggest that there isgeneral but not universal shortage of useable industrial land.

6.5 This SPG recognises that demand and supply of industrial land remains unevenlydistributed throughout London. Following DLP paragraph 3B. 30 it provides guidanceon redressing these imbalances, recognising that outside the SEL some industrial landwill still be transferred to other uses in areas of general shortage, e.g. in parts of Westand South London and of the Central London fringe, though most transfers will takeplace elsewhere. This requires a more flexible, criteria-based approach to industrialcapacity than was provided by historic policy and one which is more rigorously

attuned to changes in market relationships. Paragraphs 5.4-5.6 underscore the needfor regular, strategically coordinated reviews of demand and supply of industrialcapacity.

6.6 Locally Significant Industrial Sites: Outside the SEL Framework, boroughs shoulddesignate on UDP Proposals Maps those sites of particular local importance whichthey wish to protect for industrial users. Where these sites are identified on ProposalsMaps and are afforded the same policy protection in the UDP as those sites withinthe SEL Framework, there will be strategic support for boroughs to resist theirdevelopment for non-industrial uses. However, to ensure that land so protected willbe used efficiently, UDPs should draw on the criteria outlined in paragraphs 6.9 6.15 and must demonstrate that there is local demand for them in industrial use.Particular attention should be paid to retaining adequate capacity to meet therequirements of firms servicing Central London which require sites within or close toits fringe.

SPG 3 Locally Significant Industrial Sites

In implementing Draft London plan policy boroughs when reviewing UDPs,should:

protect locally important, viable industrial sites, which lie outside theSEL Framework after testing them in the light of evidence of local and

strategic demand (paragraphs 6.9 6.11) and against the criteria in

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paragraphs 6.12 6.15. These sites should be identified on UDPproposals maps.

6.7 Other Industrial Sites:Informed by guidelines in this SPG (paragraphs 6.9 6.15),boroughs should use flexible, criteria based policies to address any remainingindustrial sites not shown on Proposals Maps and lying outside the SEL Framework.

These policies will guide management of the sites for industrial and other purposestaking into account strategic and local planning concerns as well as marketconditions. To inform application of DLP policy 3B.6 this SPG seeks to retain inindustrial use higher quality industrial sites and those of poorer quality which meet ademonstrable need for low cost accommodation. To support the wider environmentaland land use objectives the DLP (DLP paragraphs 23 32) it also seeks the managedtransfer of sites which are genuinely redundant for industrial purposes, and where analternative land use is more suitable in planning terms. It is anticipated that these willbe mainly for housing including affordable housing (DLP Policies 3A. 1-2, 6 13) or,if they can be integrated with town centres, also for office, retail, leisure, civic andother town centre related uses (DLP Policy 3D.1 - 2). Boroughs, in UDPs, should

identify the characteristics of locally valuable industrial sites (including thoseproviding low cost accommodation), taking account of the nature of the overallindustrial offer within the locality and likely demand from industrial users over theplan period.

6.8 In view of the cumulative economic importance of small scale industrial sites and thestrategic significance of the after-use of those which are genuinely surplus toindustrial needs, the criteria guidelines to manage Other Industrial Sites are astrategic as well as a local concern. In line with DLP Policy 3B.6 the criteria to beincluded in UDPs should be developed by boroughs in the light of localcircumstances, local and strategic industrial market assessments and strategic

coordination guidelines set out in paragraphs 6. 9 6.15. As part of this process,boroughs should co-ordinate monitoring and policy development with neighbouringboroughs on a sub-regional basis.

SPG 4 Other Industrial Sites

In implementing Draft London Plan policy, Boroughs when reviewing UDPs,should:

develop criteria-based policies to manage the release from or retentionin industrial use of those industrial sites outside the SEL Framework and

not designated on Proposals Maps in the terms of SPG 3 above. Suchpolicies should take account of demand (paragraphs 6.9 6.11) andthe criteria set out in paragraphs 6. 12 6.15 below.

ensure that sites released from industrial use through this policy meetstrategic as well as local needs. The first priority should be to meet theneed for housing including affordable housing. Increasing capacity fortown centre related development will also be important in appropriatelocations.

6.9 In developing policy criteria for industrial sites outside the SEL Framework and notshown on Proposals Maps, boroughs should take account of the sub-regionaldemand and supply of industrial land. In this, they should be informed by groupingsof boroughs to be identified in the published SPG which will provide a broadindication of borough level industrial demand and the broad policy response to this.

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The published SPG will recognise that within boroughs (and the general level ofdemand indicated for them) there can be marked local differences in demand andsupply of industrial space. It will be for boroughs to justify and address these localdepartures from general market conditions prevailing in their areas.

6.10 The groupings set out below were identified by consultants11 in 1999 to reflect thesub regional balance between industrial land demand and supply suggested bymarket experience as well as broader economic indicators. In the short term they willbe reviewed through this consultation process and through research commissioned toinform it. In the longer term they will be reviewed as part of the monitoring processproposed above.

6.11 Those boroughs within the Restrictive Transfer category are encouraged to adopt aparticularly restrictive approach to the transfer of industrial sites to other uses. Thoseboroughs in the Managed Transfer category generally have a greater supply of

vacant industrial sites relative to demand and should generally take a more permissiveapproach to transfer. The Limited Transfer category is intermediate between thetwo. Borough level policies should reflect these local differences in supply anddemand of industrial sites. The City of London is excluded as no significant industrialland remains there.

Restricted transfer of industrial sites

South Bromley, Croydon, Kingston, Merton, Richmond, Sutton

West Hammersmith & Fulham

Central Westminster, Camden, Kensington & Chelsea, Wandsworth

Limited transfer of poorer industrial sites

West Brent, Harrow, Hillingdon, Hounslow, Ealing

North Barnet, Enfield, Haringey, Waltham Forest

East Hackney, Lewisham, Tower Hamlets

Central Islington, Lambeth, Southwark

Managed transfer of poorer industrial sites

East Barking & Dagenham, Bexley, Havering, Greenwich, Newham, Redbridge

6.12 In developing criteria-based policies, boroughs should seek to retain those sites inindustrial use which the borough considers to be most important for industrial users.These will generally include the better quality industrial sites, but may also includepoorer quality sites which provide scope for low cost industrial accommodation forwhich there is demand. Boroughs should consider the criteria set out below forinclusion within such policies.

6.13 Strategic Factors, including whether a site:

meets demonstrable short term demand for industrial development, and / or

strategic long term demand;

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is part of a larger area of existing industrial activity, or area designated forindustrial protection;

offers potential for the in-situ expansion of existing industrial businesses;

supports local or strategically important clusters of industrial activity;

meets demand and addresses the particular needs of new or emerging industryespecially those identified in DLP policies 3B.7, 9, 10 and 12 and 4A.3 and 10 egwaste, energy and recycling, taking account of the proximity principle whererelevant.

is well located to take advantage of existing or proposed infrastructure oreconomic development / regeneration funding;

offers potential for the provision of small industrial units serving local residentialand commercial areas, particularly where there is little alternative provision in thelocal area;

is needed to accommodate provision for transport in terms of forthcomingMayoral guidance on provision for transport and safeguarding river related useseg bus garages, boat yards.

contributes to local employment objectives and local economic diversity.

6.14 Site Characteristics, including whether a site:

is well located in relation to the strategic highway network or local highwaynetwork, in particular causing minimal traffic impact in residential areas;

offers potential for transport of goods by rail and/or water transport;

is located within or adjacent to a town centre, recognising that PPG6 and PPG13promote high trip generating uses at such locations;

is well located in relation to public transport facilities, recognising that manyindustrial activities have relatively low trip generation and that other land uses(such as offices, leisure and retail) may be more appropriate in locations withhigh public transport accessibility;

offers potential for 24-hour working, or provides facilities for bad neighbouruses with detriment to residential amenity, being well screened fromneighbouring uses, particularly residential areas;

offers potential for space intensive activities which do not fall within the ambit ofthis SPG and would not, in this location, compromise wider planning objectives.

provides lower cost industrial accommodation suitable for small, start-up, orlower-value industrial uses or other businesses important to the local economy;

provides sufficient space for adequate operational parking and turning space forgoods vehicles.

6.15 Industrial Demand Factors, including whether a site:

has been adequately marketed at realistic prices for a reasonable period(normally at least two years) and with potential for industrial redevelopment

where this is required to meet the needs of industrial users;

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and Locally Significant Industrial Sites (see SPG 3 above). In view of the particularneed to increase housing provision, especially of affordable housing, housing will bethe key other priority on permissible mixed use re-developments. Leisure, retail, civicand other town centre uses will also be appropriate if the mixed use development canbe integrated with broader proposals for town centre renewal. However, other than to

provide small scale, local convenience services, such uses will not be appropriateoutside town centres.

7.6 Re-development, intensification and selective support for higher density, mixed usesin these locations must not compromise their offer as the main strategic and localreservoirs of industrial capacity. Inappropriate re-development of even parts ofindustrial sites can compromise the industrial offer of wider areas. This is particularlyimportant in areas where industrial capacity is in short supply (see paragraph 6.11).This SPG therefore supports the thrust of the Draft London Plan 3B.6 in underscoringthe prime purpose of SELs which is to ensure an adequate stock of industrialemployment capacity. Mixed-use development should only be permitted where it willsupport this central policy objective and support the DLPs broader objective toencourage better use of land such as that which can be brought about by mixed usere-development.

7.7 Without compromising policy to resist inappropriately located retail and leisuredevelopment, provision should be made for small scale, walk to facilities, particularlyA1 and A3 uses and specialist services like crches, which serve the needs of peopleworking within industrial areas. Such provision is likely to be particularly important inlarger industrial areas, including SELs.

SPG 5 Industrial Capacity and Mixed Use Development

In implementing Draft London Plan policy the Mayor will and the LDA, TfL,boroughs and other partners should:

identify strategically recognised industrial sites or parts of sites whichhave good public transport accessibility, especially those within or onthe edge of town centres, for industry led, higher density, mixed re-development. This re-development should not incur a significant net lossof industrial employment capacity or compromise the offer of widerareas as competitive industrial locations.

establish robust and sensitive industrial relocation arrangements to

support re-development where necessary. where necessary improve provision of small scale, walk to amenities

and services including crches, which serve the needs of people workingwithin industrial areas.

8 QUALITY AND VARIETY OF INDUSTRIAL CAPACITY

8.1 The poor quality of sites allocated for industrial development is a major concern inmany parts of London. Much of the vacant industrial land in London is unavailablefor development because of various forms of constraint, or because it is unsuitablefor modern industrial purposes. In 1998 it was found that at least 40% of vacant

industrial land had constraints preventing immediate development13.

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intensification maximise site attractiveness and uplifts in land values generatedby proximity to transport infrastructure through higher density, higher quality re-development

settings - maximise site attractiveness and uplifts in land values generated bynearby, higher value or more attractive uses/surroundings through re-development

surroundings - design should complement and enhance the surrounding uses

8.5 In improving the quality of industrial provision account should also be taken of theneeds of firms which make important contributions to the London economy but havenegative environmental impacts. Boroughs should therefore ensure that there isadequate capacity for difficult neighbour industrial uses in locations where they willnot detract from the environment of other activities. These will usually be in PILs.Many of the difficulties which such industries have traditionally caused, can beavoided through careful design of facilities and their relationship with surroundingareas.

SPG 6 Quality and Variety of Industrial Capacity

In implementing Draft London Plan policy the Mayor will and boroughs,the LDA, TfL and other partners should:

seek to enhance the operating environment within and around all viableindustrial areas.

subject to securing low cost premises to meet local needs, encourage there-development of Londons industrial areas to enhance their offer as

competitive locations attractive to modern industry. seek imaginative, sensitive design and investment solutions which do

not entail a net loss of industrial employment capacity, which makemore efficient use of space and which enhance the environment withinand around industrial areas.

depending on local circumstances planning agreements are likely to benecessary to secure the DLP objectives detailed in this SPG including

premises for different types of industrial occupier, transport, e-relatedand other infrastructure, contributions towards site assembly anddecontamination and meeting the needs of specialist industries.

make provision for demand for difficult neighbour industrial uses inenvironmentally acceptable locations, normally within PILs, and through

good design ensure that they do not compromise the viability of otheractivities or the regeneration potential of the area. Proposals for wastefacilities should accord with the policies of the Mayors London Plan andWaste Strategy.

9 SMALL INDUSTRIAL ENTERPRISES

9.1 The Mayors DLP and Economic Development Strategy recognise that most industrialfirms in London are small and many may suffer from inadequate or inappropriate

accommodation. This SPG seeks to protect viable industrial sites which canaccommodate small industrial units suitable for start-ups and small industrial

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businesses. Where large, higher value schemes are proposed and there isdemonstrable need for smaller or affordable industrial premises, boroughs shoulddraw on national and metropolitan mixed use policy to seek planning agreements tosecure provision of these as part of mixed use schemes.

SPG 7 Small Industrial Enterprises

In implementing Draft London Plan policy the Mayor will and boroughs,the LDA, TfL and other partners should:

protect industrial sites which meet demonstrable demand for lower costindustrial accommodation.

promote the provision of small industrial units suitable for smallbusinesses and start-up companies.

secure provision of small and affordable industrial units in appropriatelocations as part of larger mixed use schemes, including commercialdevelopments and residential schemes where careful siting, design andaccess arrangements can satisfactorily overcome environmentalconcerns.

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10 STORAGE AND DISTRIBUTION

10.1 In the past there has been a view that warehouse development in general industrialareas should be resisted on the grounds that employment opportunities are fewer andinferior to those provided by manufacturing firms. However, distribution functionscomprise a significant element of much general industrial activity in London and areexpected to become more important. This is diminishing traditional differences inemployment density between production and distribution. More specifically wholesaledistribution facilities, such as large warehouses, also provide a key economic servicefor the capital, even though they usually have low employment densities.

10.2 Planning policy must therefore take a positive approach to provision for distributionin the context of the overall objectives of the DLP. Heavy traffic generators should besteered away from environmentally sensitive locations to those where their impactscan be minimized, usually in Preferred Industrial Locations with easy access to thestrategic road network. In line with sustainable transport policy set out in the DLP,

boroughs should promote facilities at locations which allow the movement of goodsby rail or water. Where boroughs do seek to restrict the development of warehousingfacilities within industrial areas they should provide reasoned justification for thisrestriction, particularly where these restrictions apply within PILs. At a more strategiclevel, the review of potential to consolidate SELs proposed in paragraphs 5.12 5.14will provide an opportunity to coordinate warehousing provision to more effectivelymeet wholesale distribution needs across London.

SPG 8 Storage and distribution

In implementing London Plan policy the Mayor will and boroughs, the LDA,

TfL and other partners should:

encourage distribution facilities which will promote the movement ofgoods by rail or water.

in light of local and strategic assessments of demand, ensure thatprovision is made for large scale distribution activities in environmentallyacceptable Preferred Industrial Locations with good access to the

strategic road network, and generally resist it elsewhere.

generally accommodate smaller warehouse facilities and mixedindustrial / warehouse units within the SEL in line with strategic road

capacity. Such provision on industrial sites outside the SEL should notcompromise the local environment, access or road capacity or broaderconcerns to secure intensification at appropriate locations.

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ANNEXES

Annex 1:INDUSTRIAL LAND DEMAND AND SUPPLY TRENDS

1 INDUSTRIAL LAND SUPPLY

1.1 Comparable information on trends in the overall stock of industrial land is not

available. The most up to date stock data14 shows that London contains 12.1 mll sq mof industrial floorspace and 15.6 mll sq m of warehousing space, both concentratedin outer London (Figures 2 and 3).

1.2 A partial data time series shows availability of industrial land over the decade to199815. This suggests that available land increased from 1,300 ha in 1987 to 1,600 hain 1991 before declining to 1,200 ha in 1995 and 900 ha in 1998. LPAC estimatedthat between 1991 and 1998 releases to non-industrial uses averaged 75 ha pa. Itcalculated that only 2% of this loss was from sites within the Strategic EmploymentLocations. Much of the loss was concentrated in Inner East London. Considerableareas stood vacant for long periods: 45% of that recorded vacant in 1995 was stillvacant in 1998. Of the sites becoming vacant between 1995 and 1998, 30% hadsome constraints on their re-development and 6% had major constraints. Overall,more than 40% of available land was recorded as having some form of constraint ondevelopment in 1998. The GLA and boroughs are currently updating this data series

as part of the London Plan monitoring process.

Figure 2 Borough Distribution of Industrial Floorspace 2002

Source: ODPM. Commercial and Industrial Floorspace and Rateable Value Statistics, 2002. ODPM 2003

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Figure 3 Borough Distribution of Warehouse Floorspace 2002

Source: ODPM. Commercial and Industrial Floorspace and Rateable Value Statistics 2002. ODPM 2003.

1.3 Consultants Roger Tym & Partners and GVA Grimley16 estimated that in total, Londoncontained some 6,900 ha of industrial land in 1999. This figure is broadly consistentwith that estimated by LPAC. LPAC concluded that two thirds (4,600 ha) of the totallay within defined Strategic Employment Locations (SELs). Of this, 70% wasdesignated purely as Preferred Industrial Locations (PILs), 12% as Industrial BusinessParks (IBPs), nearly 16% as joint IBP/PILs and 1% as Technology Parks. The policyapproach to the latter is outlined separately within the DLP under Offices. The subregional breakdown of the different categories is shown in Table 1 and theirindicative location is set out in Fig 1 (DLP Map 3B.1). Coupled with geographicalvariations in demand (paragraphs 6.9 6.12), this range in the distribution of thesupply of industrial capacity underscores the need for local refinement of pan-London SPG through Sub Regional Development Frameworks.

Table 1 Industrial Land within Strategic Employment Locations 1998 (ha)

Sub-region PIL PIL/IBP IBP Total

Central 179 - - 179

East 1,558 72 241 1,871

West 654 652 155 1,460

North 406 - 98 504

South 482 - 58 540

Total 3,279 723 551 4,553

Derived from: LPAC Report 14/2000, Strategic Employment Sites: Revised Framework and PolicyAdvice, 1 Feb 2000

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1.4 This table does not show Other Employment Areas (OEAs), which lie, outside theStrategic Employment Locations. LPAC estimated that those that could be identified,including some proposed for mixed uses, cover about 2,200 ha. In addition, therewere smaller, scattered sites which were not identified by LPAC.

2 INDUSTRIAL LAND DEMAND

2.1 On average, over the 30 years to 2001, London annually lost 24,100 manufacturingjobs (-2.3% pa) and 1,500 from wholesale distribution (-0.5% pa)17. In the late

1990s, Roger Tym & Partners18 found that the consensus among forecasters was thatwhile total London employment was expected to grow, that in industry was expectedto decline and more steeply than for the UK as a whole, though less steeply than inthe past in London. Rates of forecast loss ranged from 1.7% to - 2.6% pa for theperiod 1996 2015. Their own forecast indicated a slightly slower decline (-1.1%, -2,900 workers pa) for manufacturing and slight growth (0.3%, 600 workers pa) fordistribution. They suggested that this was because London is gradually losing its

comparative disadvantage because much of the activity for which the capital is not acompetitive location has already left, and there are a number of actual and plannedimprovements which should make London a more attractive environment forindustry.

2.2 The GLAs more recent review of independent forecasts confirms these general

trends19 . Its own independent projection20 suggests that manufacturing employmentis likely to decline by1.6% or 5,100 workers pa and wholesale distribution to increaseby 0.3% or 900 workers pa.

2.3 Recent government estimates suggest that the vacancy rate of floorspace (as

opposed to the overall amount of vacant industrial land) peaked in the mid 1990s at15% before declining to 9% in 2000/01. Vacancy rates in London, especially innerLondon, have been consistently and significantly above those of other Englishregions. Within London, some boroughs e.g. Hackney 24%, Ealing 18%, Brent 15%,Newham 14% were substantially above the relevant Inner/Outer averages21.

2.4 London industry is dominated by two sectors distribution which accounts for 40%of industrial employment and paper, printing and publishing with 20% (though 60%of this sub sector works in publishing rather than printing or paper manufacture).RTP/Grimleys suggest that industries which are likely to find London a competitivelocation are those which:

serve London markets

are near the end of the physical production process, producing finalcommodities rather than capital equipment or intermediate goods

produce time sensitive goods and services

are high productivity and high value added but not necessarily hightechnology

are at the borderline of industry and services, with a high tertiary content

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2.5 Those which typically do not find London a good location and over time are likely todecline relatively probably include heavy manufacturing plants serving geographicallylarge markets. In between these two extremes, mainstream activities are those forwhich London will often be a reasonably competitive location. They are likely toinclude activities which serve very localised markets and are comparatively low-skill

and low-value added, but closely tied to London, such as low level distribution, motorrepairs, some construction and a host of small scale services22.

2.6 To translate these employment forecasts into demand for land, RTP/Grimleysreviewed the relationship between industrial workers, floorspace and land in differentparts of London. On the basis of their own, particularly modest forecast of decline inindustrial employment, they suggested that in net terms London was likely to lose 32ha pa to 2015. This was much lower than the 400 ha pa loss implied by governments

floorspace statistics for 1984 9423 (RTP/Grimley), the 32 - 97 ha pa loss suggested

in an independent study by Halcrow Fox24, the 75 ha pa recorded by LPAC25 as beingreleased from industrial use 1991 98 and the 51 ha pa implied by the GLAs

independent projections26

2.7 In light of the scale of decline in demand for industrial land indicated by thesedifferent sources, the 32 ha pa net loss figure reported in the DLP is very prudent andprovides for a generous vacancy rate of approximately 14%. Moreover, it is basedonly on vacant land, not vacant land and premises. RTP/Grimley suggest that evenon the most cautious assumptions, there are about 500 ha of industrial land that willbe available for other uses over the next fifteen years, and there could be as much as800 ha.

2.8 More recent, independent re-working of the RTP data for the LDA27 indicates that,under some scenarios, the 32 ha pa figure could be increased to 80 or even 120 ha pawhen greater weight is given to vacant premises as well as vacant land. This stronglyunderscores the robustness of the Volterra based28 51 ha pa figure put before theExamination in Public into the DLP.

2.9 Industrial land policy cannot simply be predicated on a quantitative, macro view ofthe overall relationship between demand and supply. Account must also be taken ofqualitative and geographical mismatches in supply and demand, especially in view ofthe extensive physical and other constraints that affect industrial land. This calls foraction which will address these constraints rather than simply seeking to sustain theoverall stock of land in its present condition. Though the most recent, purelyquantitative assessment suggests that there is surplus industrial capacity in all

boroughs29, the consultants did not consider that this invalidated the conclusion oftheir earlier, more market sensitive appraisal - that in parts of South and West Londonthe supply of useable and attractive industrial land may not be equal to requirements.This will be tested in a new market demand assessment (paragraph 6.9 6.11.

2.10 This SPG provides the context for Sub Regional Development Frameworks to takeaccount of these variations in demand and supply. Table 2 below illustrates, on thebasis of different assumptions, how surplus industrial land might be released inLondons different sub-regions. The first of these assumptions reflects a pro ratarelease of between 30 and 50 ha pa based on the distribution of vacant industrialland in 1998. The second and third maintain the same London-wide scale of release

but assumes that there will be 25% or 33% less release in South and West Londonand that the balance is re-distributed to East, North and Central London. Revised in

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the light of consultation on this SPG and the currently on-going 2003 Industrial LandAvailability Survey, these illustrations will inform sensitivity tests in the final SPG tohelp monitor release of surplus industrial land through Sub Regional DevelopmentFrameworks.

Table 2 Draft Sensitivity Benchmarks to Monitor Sub Regional Distributionof Surplus Industrial Land Release (hectares pa)

London Central East West North South

30 1.3 16.6 5.7 4.8 1.7

40 1.7 22.1 7.6 6.4 2.2

Scenario 1: pro rata

distribution on

basis of vacant

industrial land 1998 50 2.1 27.7 9.5 8.0 2.8

30 1.4 18.0 4.3 5.2 1.3

40 1.8 23.9 5.7 6.9 1.7

50 2.3 30.0 7.1 8.7 2.1

Scenario 2: asScenario 1 but with

25% less loss in W

& S and the balance

redistributed to the

E, N & C

30 1.4 18.4 3.8 5.3 1.1

40 1.9 24.5 5.1 7.1 1.5

50 2.3 30.7 6.4 8.9 1.9

Scenario 3: as

Scenario 1 but with

33% less loss in W& S and the balance

redistributed to the

E, N & C

2.11 Qualitative assessment of industrial land demand and supply relationships alsounderscored the need for policy to recognize that while there will be a net reductionin overall demand during the term of the Plan, at any one time there is likely still tobe substantial demand for usable industrial land. On the basis of development trendsit was estimated that the long term average gross take up may be up to 55 ha peryear30. This points to the importance of concerted LDA, borough and private sectorinitiatives to meet the needs of the market, especially in terms of bringing forwardoven ready land and premises in locations attractive to industry.

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Annex 2:STRATEGIC EMPLOYMENT LOCATIONS FRAMEWORK

(Draft London Plan Annex 8)

Table 3 Preferred industrial locations

Number Borough Preferred industrial location name

1 Barking & Dagenham River Road Employment Area

2 Barking & Dagenham Rippleside

3 Barking & Dagenham,

Havering

Dagenham Dock (part)

4 Bexley Belvedere Industrial Area (part)

5 Bexley Erith Riverside (part)

6 Brent, Ealing,

Hammersmith &Fulham

Park Royal

7 Brent Wembley Stadium (part)

8 Brent Staples Corner

9 Croydon Marlpit Lane

10 Croydon, Sutton Purley Way Area

11 Ealing Great Western Road (part)

12 Ealing Northolt, Greenford, Perivale (parts)

13 Enfield Brimsdown

14 Enfield, Haringey,

Waltham Forest

Central Leaside Business Area, including Deephams,

Garman Road, Leeside Road, Willoughby La. etc

15 Enfield Freezywater

16 Greenwich North Charlton Employment Area

17 Greenwich Greenwich Peninsula West

18 Greenwich Plumstead Industrial Area

19 Hackney Hackney Wick (part)

20 Harrow Wealdstone Industrial Area

21 Havering Harold Hill Industrial Estate

22 Havering Coldharbour Lane Employment Area

23 Hillingdon Uxbridge Industrial Estate24 Hillingdon Stonefield Way/Victoria Road

25 Hillingdon Hayes Industrial Area

26 Hounslow North Feltham Trading Estate

27 Hounslow Brentford (part), including Transport Avenue

Industrial Area, Commerce Road

28 Kingston Chessington Industrial Estate

29 Lewisham, Southwark Surrey Canal Area (part)

30 Lewisham Bromley Road

31 Merton Willow Lane, Beddington

32 Merton Morden Road Factory Estate

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Number Borough Preferred industrial location name

33 Merton North Wimbledon (part)

34 Merton Beverley Way Industrial Area

35 Newham, TowerHamlets

Lower Lee Valley (part)

36 Newham London Industrial Park

37 Newham Marshgate Lane Area

38 Newham Thameside West

39 Newham Thameside East

40 Redbridge Southend Road Business Area

41 Redbridge Hainault Industrial Estate

42 Southwark Bermondsey South East

43 Sutton Kimpton Industrial Area

44 Waltham Forest Lea Bridge Gateway

45 Waltham Forest Blackhorse Lane

46 Wandsworth Nine Elms

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Table 4 Industrial business parks

Number Borough Industrial business park name

1 Barnet Northern Telecom, Brunswick Park

2 Bexley Thames Road, including Crayford Industrial Area3 Bexley, Bromley Foots Cray Business Area

4 Brent, Ealing,

Hammersmith &

Fulham

Park Royal

5 Brent East Lane

6 Bromley St Marys Cray

7 Enfield Great Cambridge Road (part)

8 Hammersmith &

Fulham, Kensington &

Chelsea

Wood Lane (part), including Freston Road

9 Haringey Tottenham Hale

10 Haringey Wood Green (part)

11 Harrow Stanmore (part)

12 Hillingdon North Uxbridge Industrial Estate

13 Hounslow Great Western Road (part)

14 Kingston Barwell Business Park

15 Newham British Gas Site

16 Newham Beckton Gateway

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Annex 3:REFERENCES

1

Mayor of London. Planning for Londons Growth. GLA, 2002

2(TEC London Employers Survey 1996/97 cited in Roger Tym & Partners, GVA Grimley. Industrial Land

Demand in London. LPAC, 1999

3CEBR. Londons Contribution to the UK Economy. Corporation of City of London, 2002,

4GLA. Safeguarded Wharves on the River Thames, Consultation Draft. GLA, 2003

5LPAC. Strategic Planning Advice for London. LPAC, 1994.

GOL. Strategic Planning Guidance for London Planning Authorities, RPG 3. HMSO, 1996

LPAC. Strategic Employment Sites: Revised Advice on Planning for Industry in London. LPAC Report

14/2000, LPAC, 2000.6

HM Treasury. 2003 Budget Statement. HM Treasury 2003

7ODPM. PPG3 Housing Review Consultation Papers - Supporting Delivery of New Housing, proposed new

paragraphs 42a. ODPM, 2003

8LPAC. Report 14/2000, Annex 1. LPAC, 2000

9HM Treasury, op cit

ODPM. PPG3 Housing Review Consultation papers Supporting the Delivery of New Housing, proposednew paragraph 42a. ODPM, 2003.

10GLA Economics. Spreading Success. How London Is Changing. GLA, 2003

11Roger Tym & Partners, GVA Grimley. 1999 op cit

12DoE. Planning Policy Guidance. General Policy and Principles. PPG1. HMSO, 1997

DTLR. Mixed Use Development: Practice and Potential. HMSO, 2002

London Residential Research. Developing Additional Housing Above and On Non-Residential Sites.DTLR, 2002.

13LPAC. Report 14/2000. LPAC, 2000

14DTLR. Commercial and Industrial Floorspace and Rateable Value Statistics 2002. DTLR, 2003


16Roger Tym & Partners, GVA Grimley. 1999 op cit.

17Mayor of London, 2002 op cit

18Roger Tym & Partners, GVA Grimley, 1999 op cit

19GLA. Londons Economy Today, II, 15 October 2002. GLA, 2002

20Volterra Consulting. The Future of Employment in Greater London. SDS Technical Report 8. GLA, 2002

21ODPM Commercial and Industrial Property Vacancy Statistics England 1991/92 to 2000/01. ODPM, 2003.

22Roger Tym & Partners, GVA Grimley 1999 op cit

23 Roger Tym & Partners, GVA Grimley 1999 op cit

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24Halcrow Fox, Future Sources of Large Housing Sites. LPAC 1998


26Roger Tym & Partners. Demand and Supply of Business Space in London. SDS Technical Report 21. GLA,

200227

URS Economic Development & Planning. London Thames Gateway Industrial Land Study (unpublished).LDA, 2003

28Volterra Consulting, 2002 op cit

29Roger Tym & Partners, 2002 op cit

30Roger Tym & Partners, 2002 op cit

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Industrial Capacity

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