Capco hammered by “economic and political uncertainty”

Back in 2011, our community put on the boxing gloves. We’ve not taken them off since!

Capco’s audited preliminary results for the year ended 31 December 2017, published on 21 February 2018, admit the company is reeling from “economic and political uncertainty”, which has “impacted the residential market resulting in a further valuation decline”.

In just 12 months, Capco’s Earl’s Court portfolio has reduced in value by £135 million. The cumulative devaluation since January 2015 is £378 million which is 28%.

Sales of apartments in Lillie Square, Capco’s joint venture with the Kwoks, whose leading family member is gaoled for corruption, have plummeted from one per week in the first half of 2017 to one per month between July and December. The disproportionate sales costs of £6 million a year contributed to a loss for Capco in its Lillie Square joint venture of £32 million over the past two years.

Meanwhile, in its preliminary results, Capco continued to relay its woes, bemoaning its “disappointment [with] the statement released by LBHF regarding the deliverability of ‘the proposed level of density and affordable housing’”, and how “the political environment has made discussions on enhancing the Masterplan more difficult”.

Capco blamed political and macroeconomic conditions for its troubles along with a difficult environment for large-scale residential development, worrying justifiably that “there will remain a risk of protests and legal challenges” to its Earl’s Court development. Curiously though, it put the latter down to “the scale of the Earls Court Masterplan” rather than to its deeply immoral plan to destroy our homes and displace our community.

Capco’s rush for the exit was further evidenced on 15 February, when Property Week broke the story that rather than implement the planning permission it had obtained to convert the Empress State building into luxury flats, Capco instead was close to completing the office block’s sale to the Mayor of London for continued occupation by the Metropolitan Police.

Then, on 28 February came the news that Hammersmith & Fulham Council had revoked the Earl’s Court & West Kensington Supplementary Planning Document, the statutory planning brief for the area, which the previous administration had produced to support demolishing the West Kensington and Gibbs Green estates. Ignominiously consigning the Plan to the dustbin, the Council announced that “all physical and digital copies of the documents will be removed from Hammersmith Town Hall, public reference libraries and the Council’s website.”

Not to be left out, on 6 March, Transport for London’s top lawyer, General Counsel Howard Carter, announced to TfL’s most senior staff, the Mayor of London, TfL Board Members and the Deputy Mayor of London for Transport that with respect to the overall consented masterplan for Earl’s Court: “There is no requirement to demolish any of the Estates in order to develop the land owned by ECPL.”

Real estate specialist David Parsley summed it all up on 23 February in a comment piece for the leading trade journal Property Week. Describing the Earl’s Court scheme as a “sorry mess” he observed: “The Company has been fighting a bitter battle with residents of the West Kensington and Gibbs Green estates since buying the site eight years ago, a battle it is losing.

Instead of continuing to fight, Capco should see [Housing Minister Dominic] Raab’s hint that government will make life even more difficult for it if it continues as an opportunity to finally rid itself of this impossible project.

I understand that Hammersmith & Fulham chief Stephen Cowan has written to Capco offering to pay back the £70m the council received for the estates and take the homes back under his control. Capco should bite Cowan’s hand off and give the estates back, finalise the deal to sell Empress State and then get to work offloading this troublesome project.”

Wise counsel, which Capco would be well advised to act on immediately.

Upstream solution for downhill exit 



Government says estate regeneration should have majority resident support

Before the debate: West Kensington and Gibbs Green residents turn out in force to hear MPs discuss our campaign to save our homes 

At a special debate in Westminster Hall on 20 February 2018, called by Hammersmith MP Andy Slaughter, Housing Minister Dominic Raab said: “Regeneration should have the support of a majority of the residents whose lives will be directly affected”. The statement brings Government into line with the Mayor of London and the Labour Party who have said that demolition of council estates should only proceed with majority resident support.

Social Housing and Regeneration: Earl’s Court and West Kensington

Here is the full transcript. The hour-long debate can be watched here starting at 13.30.

A precis of the debate is reproduced below.

Andy Slaughter (Hammersmith) (Lab)

Last Thursday, Property Week carried the story that Capital & Counties Properties plc, the promoter of the Earl’s Court development, is about to sell the Empress State building to the Mayor’s Office for Policing and Crime for around £240 million. Throwing in the towel on Empress State is the clearest sign yet that not just the master plan, but Capco itself is in serious trouble and is seeking to cut and run to save its own skin.

In 2013, Hammersmith and Fulham Council made a deal to receive £90 million for the estates, plus space in the new development to replace the homes lost. Uniquely, however, that sum was not index-linked. Moreover, the council needed to deliver vacant possession of the land. That meant buying out 171 leasehold and freehold homes, which is normally the developer’s task. The maximum needed to acquire the homes was budgeted as £60 million, although valuation experts assessed the true figure as between £150 million and £174 million. The council has already purchased 26 homes at an average price of £552,000, excluding compensation, which is well in excess of the estimated £350,000.

The true value of the land is not recorded, but reading across from the valuation of the exhibition centre site, which is, suggests that a more accurate figure is around £1 billion. By accepting no more than 10% of the land’s value and by underestimating the costs of acquiring vacant possession, the council could now be left with a zero receipt and a maximum of 672 replacement homes for residents of the estates, having sold 88 homes to cover its shortfall.

Residents have done everything they can to make it very clear what they do not want: demolition. In December 2009, a year after learning of the possible demolition of their homes, residents from 83% of households on the West Kensington and Gibbs Green estates signed a petition to oppose it. In March 2012, 80% of residents who responded to the council’s consultation on the scheme said no to demolition. Residents have also been very clear about what they want instead: community ownership. In March 2011, they formed West Ken Gibbs Green Community Homes, a community-controlled not-for-profit organisation with membership from more than two thirds of households on the estates. It was set up with the intention of exercising council tenants’ right to transfer.

Karen Buck (Westminster North) (Lab)

I congratulate my hon. Friend on his powerful speech. Does he agree that residents could do a lot worse than learn from the community ownership experience in a neighbouring estate? Walterton and Elgin Community Homes was set up in the face of a threat from Westminster City Council in the late 1980s. It has proved to be one of the most successful and popular models for social housing in the country. Does he agree that that experience shows exactly the approach we should take when estates are threatened?

Andy Slaughter

The right to transfer allows council tenants to choose a different landlord for their area. The objective of West Ken Gibbs Green Community Homes is to become the community-controlled landlord for its members’ homes. For four years, it lobbied the Government to implement the necessary legislation to enable it to use the right to transfer under the Housing Act 1985, as amended by the Housing and Regeneration Act 2008. The necessary regulations came into force in December 2013, and in March 2015 members voted 100:1 to serve a right-to-transfer proposal notice.

Residents came up with the people’s plan, which shows the professionals how new development ought to be done. At the outset, Community Homes brought more than 100 residents into workshops and site visits with architects. Residents and architects together identified space for up to 327 new homes and devised plans for improvements to their homes, streets and community spaces. The plans were costed and valued. Residents from 65% of households provided written feedback on these proposals, and 90% of respondents said that the plans were “excellent” or “good”, and “better” or “far better” than the Capco scheme.

I thank everybody in the community at West Kensington and Gibbs Green, and their supporters and advisers, for the struggle of the last 10 years. It has been gruelling, and 2,000 people have had their lives on hold, unable to move on with everything from modernising their home to planning their family’s future. However, it has created a fantastic community spirit and inspired people to create their own vision for the future.

I have only a couple of simple requests to put to the Minister. First, will he please determine the Community Homes application for the right to transfer, which his Department has been waiting to determine for more than two years? When he does so, can he please heed the residents’ call for him to uphold their legal right to take back control—a phrase I am sure he is keen to hear in this Chamber—of their community, so that they can deliver the homes that we need?

Secondly, I ask the Minister to get the Government, including his Department, to work with the residents, the boroughs and the Greater London Authority—they are all now of one mind, a very different mind from the one of 10 years ago—to provide decent, genuinely affordable homes across the Earl’s Court site.

Emma Dent Coad (Kensington) (Lab)

Let us hope that the days of cosy relationships between developers and planning departments are well and truly over. How the world has changed. Three years on, Capco is on the ropes, its share value plummeting due to the local luxury housing over-provision, and the heat has been taken out of the market, by, among other factors, fears over Brexit. Capco’s recent half-hearted attempt to intensify the provision of units at Earl’s Court—to provide more small housing units that it thought it could sell, rather than the huge and unwanted super-prime units of its dreams—seems to have hit a brick-clad wall.

Politically, culturally and in terms of local need, the scene has changed dramatically. The international appetite for buying flats to park money—sometimes dodgy money—has waned, and it seems that even Capco has accepted that. It had hoped its desire to intensify Earl’s Court could be agreed within the current planning permission, but that is not happening.

Let us not compound the litany of errors and developer greed with yet another round of international online poker, using our neighbourhoods as chips, to sell the site abroad. Local house prices are plummeting—or what the estate agents call “softening”—and there is no longer any taste for these super-luxury developments that have turned parts of London into ghost towns. The current plan is undeliverable; we need to start again. We need to curtail the developers’ rampage through our neighbourhoods and look to a future at Earl’s Court that does not offer empty units for international investors but instead satisfies local needs and provides homes for existing residents.

Let us show that change now by finding ways to realise our constituents’ ambitions. Let us leave the 2,000 residents of my hon. Friend the Member for Hammersmith (Andy Slaughter) in peace to enjoy and manage the homes built with conscience and care over the past 50 years. On my side, at Earl’s Court, let us support a struggling area that has been decimated by developer greed, by working closely with the London Mayor and the Government to repeal the current planning permission where possible and work with the people of Earl’s Court to provide socially rented and truly affordable housing for those who need it, cleaner air, and a fantastic modern exhibition centre that will provide jobs and return vital business.

The Minister for Housing (Dominic Raab)

I congratulate the hon. Member for Hammersmith (Andy Slaughter) on securing this debate. We have sparred many times on justice matters, and I look forward to an equally rigorous friendship on housing issues. He takes a close interest in those issues and I know how tenaciously he makes his case for his constituents and on matters of principle. I pay tribute to the residents who have come to listen to him and to hear the different views on this important matter.

I take note of all the hon. Gentleman’s points regarding the merits or otherwise of the development of the Earl’s Court and West Kensington area. He will know that the Secretary of State for Housing, Communities and Local Government has been asked to make a decision on two specific matters submitted for his determination. The determination requests are currently being considered in the Department. The hon. Gentleman made some specific requests that I want to address clearly. As a lawyer and an assiduous local MP, he will know that that process precludes me, for legal and propriety reasons, from commenting specifically on the regeneration proposals for the Earl’s Court and Kensington area.

Social housing is a priority for this Government. Estate regeneration done the right way can create new improved homes and communities for the people who live there. It can increase the supply and quality of homes through densification and design. The best estate regeneration schemes make the community central to the project. Residents are clearly key partners in any regeneration scheme. They should have opportunities to participate from the start, developing the vision, design, partner procurement and delivery. Working with residents can help to build trust and consensus on regeneration.

It is particularly important that residents have the opportunity to express their views on the final options for regeneration, whether as individuals or through the democratic process more generally. The way that is done should be agreed locally. That is the template for the national policy that we put out. The regeneration should have the support of a majority of the residents whose lives will be directly affected.

Andy Slaughter

I appreciate the tone of the Minister’s speech and what he said about not giving a view on the regeneration scheme. However, may I press him a little? If he cannot say what his position is, can he indicate—this is not unreasonable after two years—when there is likely to be a decision on the right to transfer?

Dominic Raab

The hon. Gentleman has made his point in a constructive and reasonable way. I appreciate his frustration on the time issue. After the length of time and all the issues that have been churned over, no one will say this has been done in a rushed way, but we need to take the time required to get the decision right. I cannot give him a specific timeframe, but we will move as expeditiously as we can. I certainly will take back to the Department the point that he has made.

Andy Slaughter

I am glad we had a civilised debate, but that does not detract from the fact that what has happened, particularly to the tenants and residents of the West Kensington and Gibbs Green estates over the past 10 years, has been an outrage. It would not have been tolerated were this not an area of social housing. Threatening to demolish 750 private homes in the same way simply would not happen. All we ask is that similar standards are adopted. That is why I am delighted with the Mayor’s new guidelines and his wish to use his own power and economic clout to ensure that tenants are fully consulted in future.

I end where I began by thanking everybody who has taken part in the debate. Most of all I thank the tenants and residents not only for giving up their day and being here—they have given up so many days—but for everything they have done for their community. By resisting the demolition that was due in the area, they have prevented it from happening to other communities in Hammersmith and elsewhere. For that we all owe them an undying debt of gratitude.

After the debate: Elected representatives Andy Slaughter MP (centre); Earl’s Court Councillor Linda Wade (left); and Emma Dent Coad (right) surrounded by residents.

Unviable, undeliverable and not right: Council Leaders blast Earl’s Court scheme as London Mayor supports ballots for residents

Capco Director Gary Yardley is outgunned as the Leader of Hammersmith & Fulham Council and the Deputy Leader of Kensington & Chelsea Council join forces to challenge him over the Earl’s Court scheme, while the London Mayor says in future residents should be balloted about demolition plans

LBHF Council Leader Stephen Cowan says the Earl’s Court scheme is “unviable” and “undeliverable”. He has “called on Capco to return the estates to LBHF”

On 29 December 2017, further to the letter he wrote to all residents on 6 November announcing Capco was in talks to hand back the estates, LBHF Leader Stephen Cowan wrote again to residents.

The letter, headed “West Ken and Gibbs Green estates to return to council control – update”, said: “It remains the Council’s opinion that the CLSA scheme, as it stands, is unviable: Capco’s 2016 accounts reported a 20% drop in the scheme’s value, and the costs are known to be very high.”

The Council went further still in a press release dated 18 January 2018: “LBHF views the current agreed scheme as undeliverable and have called on Capco to return the estates to LBHF as this is the only viable way forward.”

Now, neighbouring borough, Kensington & Chelsea, which is the planning authority responsible for the former exhibition centres part of the Earl’s Court site has weighed in.

RBKC Council Deputy Leader Kim Taylor-Smith says the Earl’s Court scheme is “not right”. He told Capco “it is important that our communities take the lead in decisions affecting their neighbourhoods”

On 24 January 2018, replying to a question from Earl’s Court Councillor Linda Wade, the Deputy Leader of the Royal Borough of Kensington & Chelsea, and Member for Grenfell Recovery, Housing and Property, Councillor Kim Taylor-Smith, told Full Council:

“Following the Grenfell fire, this Council, and its new leadership and I am now focusing on housing that is truly affordable, and social housing, and I want our communities to take the lead in decisions affecting their neighbourhoods.

And let’s be clear, this scheme is incredibly controversial. Businesses have been subject to compulsory purchase orders, and social housing in Hammersmith and Fulham is due to be knocked down and rebuilt. While new homes are being built, only around 10 per cent will be affordable. But at a discount of 20 per cent to market value, affordable housing in London is not truly affordable and none of these homes will be socially rented.

So, understandably, the London Mayor expressed his concerns about this development in his election campaign, but I understand that Councillor Stephen Cowan, the Leader of Hammersmith and Fulham, is also trying to find a way to pull back from the planning decision taken by his borough. So, in answer to your question as to whether the Council has been in contact with EC Properties or Capco on press speculation on Saudi interest, I want to go a little bit further.

On Monday I wrote to the Chief Executive of EC Properties, parent company Capco, seeking a meeting to consider the site’s future. In my letter I told him that on the 14th of June the facts on the ground changed in Kensington. I stated, and I quote, that it is important that our communities take the lead in decisions affecting their neighbourhoods. So, this Council has initiated a greater focus on social and truly affordable housing, as well as local democracy. I also told him that I want him to explore any opportunities to increase the level of genuinely affordable housing and social housing in the project.

 And I have also written to Councillor Stephen Cowan expressing my concern over this development, and I have offered my complete support to revisit these plans around the entire scheme, and I have copied this letter to the London Mayor, Sadiq Khan.

We need to recognise that we don’t have the legal power to rescind our decision. The application went through due process and was agreed by both boroughs. But politically, I want to make it very clear that I do not believe the continuation of this development under the current terms is right. And, as a minimum, if this is to continue I want to see more social and more truly affordable housing included in this scheme.”

Meanwhile, on 3 February, London Mayor Sadiq Khan published proposals to require giving residents the vote to decide whether or not they support plans to demolish their homes.

London Mayor Sadiq Khan wants “to make sure people living on social housing estates are at the heart of any decisions involving demolition”

To enforce his new policy, the Mayor would make his funding for any scheme conditional on a yes vote. Those balloted would include secure tenants, resident leaseholders and freeholders, and any resident who has been on the Council’s housing register for at least one year, irrespective of their current tenure.

The Mayor said: I will use my investment powers in a way they have never been used before, by requiring resident support through a ballot for new plans involving demolition where City Hall funding is involved. I want to make sure people living on social housing estates, who have the greatest interest in their future, are at the heart of any decisions from the outset.”

Let the people speak! Residents respond to Council Leader’s letter announcing the developer is in talks to hand back our estates

“Estates could return to council control”

Residents’s reaction on hearing the news

Hammersmith & Fulham Council Leader, Steve Cowan, has written to residents suggesting that in exchange for a fresh planning permission, “we would see the two estates return to council control”.

The news follows many months of worsening market conditions for developer Capco, which this year has taken several steps to clean up the mess it’s made so that it can exit the redevelopment scheme. The most important of these is to cut away the single most burdensome impediment to a successful disposal – our community and the homes in which we live.

West Ken Gibbs Green Community Homes Chair, Keith Drew, thanked everyone who has supported our struggle over the years. “Their efforts, and ours, are finally vindicated”, he said.

Community Organiser, Jonathan Rosenberg, issued the following statement from the three residents organisations.

“At £18 billion, the Earl’s Court scheme is the most valuable on-site urban redevelopment in the world outside of China.

For nine long years, residents have been fighting to save their homes and preserve their community. Our campaign has been through some very dark times. But right now there is a tremendous wave of excitement sweeping across the estates.

The Council Leader is working very hard to get the estates out of the land sale contract. We believe that our campaign is on course for victory and we look forward to finally lifting the curse that has so sorely afflicted our community.”

As the news raced around the neighbourhood yesterday, residents reacted with elation and a tinge of disbelief.

“It’s the best news we’ve had for a very long time. But it’s not game over until we’ve got the estates back. We’re closer than we have ever been before. Thank God we voted this Council in.” Sally Taylor, Chair West Kensington estate TRA

“I feel elated and it just shows that the voice of the people is heard and people power counts. The Council have stuck by what they said. Steve Cowan and Larry Culhane have worked tirelessly.” Diana Belshaw, Chair Gibbs Green & Dieppe Close TRA

“When I found out I was over the moon. The last nine years what we did, I can see that it worked. The People’s Plan worked. If we support each other it works. We are a strong community and we won’t let it go. So it’s time to celebrate. We’ve not won yet but it shows that we can do it. You can see that the council are doing good things. Even just day today maintenance has improved.” Murvet, Churchward House

“That’s very good. Now we can start organising. It feels like we’re three quarters of the way there. I thought it was all done and dusted. Capco are running out of money it seems. They sold the Olympia.” Martin, Gibbs Green

“I’m very happy for Capco to be out of the deal, but the Right to Transfer is still my dream. You’re not really safe unless you have resident control. When I saw the letter I thought that’s amazing. It’s not a guarantee but it’s a loud announcement that it’s looking good. It’s been a David and Goliath thing but you can win if you kick them in the knee caps.” Linda, Aisgill Avenue

Iron determination as residents vow never to give up the fight for their homes

On 3 October 2017, 75 people, of whom 67 were residents, attended the West Kensington Estate and Gibbs Green TRAs and West Ken Gibbs Green Community Homes Annual General Meetings in the Gibbs Green Hall.

Ana-Maria explained that she was now 15 years old, but that when she was nine, she had written a letter to the Council protesting against demolition. As was featured on our website at the time, she presented her letter to the Council at the so-called consultation held in March 2012, which had to be called off following a mass protest by residents. Ana-Maria thanked the campaign for helping to stop the demolition and urged people to put a stop to the redevelopment by continuing to work together as the amazing, supportive and loving community that we are.

In recognition of his long service to the Board, the Chair, Keith Drew, presented Dr Chris Taylor with a calligraphic memorial created by Harold Greatwood.

Following a minute’s silence for the victims of the Grenfell Tower fire, Company Secretary, Linda Sanders presented the Annual Report of activities. She reminded people that:

  • Developer Capco still does not have possession of our land, detailed planning permission or the requisite finance;
  • Over the past year we had held conversations with 700 residents about the People’s Plan, 500 of whom, from 65% of all households completed our survey. 91% said the People’s Plan was good or excellent and better or far better than demolition;
  • We have been engaging with the plans for the wider area including working with University College London Bartlett School of Planning to devise new masterplans, and by promoting alternatives to the demolition of Empress Place and the Lillie Road shops.

Linda explained that since the last AGM, Capco has made zero progress with its plans to destroy our estates and that, with the market and the politics against them, Capco was now in a pickle.

Treasurer, Harold Greatwood, presented the WKGGCH accounts. He reported that we have raised significant sums of money from four charities and trusts, sufficient to fund us for the next three years, which means our campaign is on a secure financial footing for the foreseeable future.

Members re-elected three serving Board Members, including Dioscore Mutsinzi [left], and two new Board Members, including Murvet Zengin [right]

The Community Organiser read out a message from Andy Slaughter MP, who apologised for not being able to attend this year. Andy reported on the new approach to so-called regeneration adopted by the Labour Party. In future, demolition of council estates will require the approval of residents through a ballot. Andy congratulated the residents for their struggle to save homes and communities, but noted that it was now ten years since the then Conservative Council first conspired with Capco to destroy their homes. He felt that events were moving our way and he promised to redouble his efforts to secure everyone’s future.

In his concluding speech, the Community Organiser explained the significance of Capco pulling back from the demolition of Empress Place and the Lillie Road shops in favour of refurbishment, albeit on a temporary basis. Capco is cleaning up the site as part of an effort to exit the scheme, but if Capco really wanted to sell, it would have to hand back the estates. Jonathan called on residents never to give up, to stand by their neighbours, and to march on as one to victory.

Above: Sally Taylor and Alexios Smith

Oh what a tangled web! Developer pulls back from demolition of Empress Place and Lillie Road

On 20 February 2016, The People’s Estates’ campaign in association with the Earl’s Court Area Action Group held a protest in Empress Place and Lillie Road calling for these buildings, our local heritage, to be saved from Mammon’s wrecking ball.

‘Earl’s Court Village’ portfolio

The Earl’s Court & West Kensington Opportunity Area is made up of land in various ownerships. The eastern part of the site, identified in legal documents as ‘Earl’s Court Village’, comprises a 999 year lease from TfL of the land formerly occupied by the Earl’s Court Exhibition Centres, land adjoining and over the West London Line, which is leased from Network Rail, Cluny Mews, 348-350 Old Brompton Road, and the Victorian cottages in Empress Place along with the adjoining shops and pubs at 2-26 Lillie Road.

All of this property is owned by Earl’s Court Partnership Limited (ECPL), the joint venture established in 2014 between Capital & Counties Properties PLC (Capco), which owns 63%, and Transport for London (TfL), which owns 37%.

In March 2016, the West Kensington and Gibbs Green tenants associations nominated the Prince of Wales pub at 14 Lillie Road as an Asset of Community Value (ACV). The Council added it to the ACV Register where it remains listed until expiry on 2 March 2021. If ECPL wants to dispose of this property, it must give community organisations the opportunity to express an interest in purchasing it.

The £150 million loan from taxpayers

In late March 2016, ECPL signed a Credit Agreement with the Homes and Communities Agency (HCA), the Government’s housing, land and regeneration agency, and the regulator of social housing providers in England, for a 10 year loan of £150 million of taxpayers’ money from the Large Sites Infrastructure Fund (now closed).

The loan, which is secured against all of the ‘Earl’s Court Village’ properties, is being used to finance the residual demolition of the exhibition centres, the removal of the concrete portal beams over the underground lines, and the installation of strategic enabling infrastructure.

Planning status

The sites of the former exhibition centres, together with land around and over the West London Line, have detailed planning permission for the construction of 1,325 homes, not a single one of which would be affordable. However, there is no planning permission at all for the redevelopment of Empress Place and the Lillie Road shops, because these properties were only acquired after September 2013, when Capco had obtained the final version of outline planning permission for the rest of the area.

Despite pleas by Capco to increase the total number of homes across the whole redevelopment from 7,500 to 10,000, so far there is no sign that the Mayor of London will oblige by revising the Opportunity Area Planning Framework, the policy document which sets the parameters for the Earl’s Court masterplan.

What a waste! Over several years, to the discomfort of the local community and to the ruin of several businesses, Capco bought up and emptied out these properties, boarding up the shops with its customary funereal black hoarding. Cafés, shops and two pubs were summarily extinguished, and the area made derelict.

Plans for demolition

In December 2016 and January 2017, Capco exhibited plans for ECPL to demolish Empress Place and Lillie Road so as to construct over 400 residential units in buildings of between 6 and up to 24 storeys, 2,000 square metres of retail and leisure uses, and to broaden the pedestrian access to the so-called Lost River Park – the concrete deck that would run north over the West London Line in a canyon between skyscrapers.

At the same time, ECPL submitted preliminary plans for demolition in the form of a request that LBHF provide a “scoping opinion” on ECPL’s Environmental Impact Assessment (EIA) scoping report.

Then, and in the weeks following, Capco maintained its intention to submit a planning application to the London Borough of Hammersmith & Fulham (LBHF) to obtain detailed permission for a scheme, which, it admitted, would represent a significant net addition of residential and commercial development to the previously consented masterplan.

At the North End Road Market Spring Fair on 29 April, we conducted an informal poll, the result of which was that just 10 people chose Capco’s tedious design for the redevelopment of Empress Place against 462 who favoured the alternative proposal by architect Francis Terry to extend and preserve it.

Demolition pulled in favour of refurbishment

Although ECPL’s EIA request for demolition should have been decided by LBHF within five weeks, it was not. Between the New Year and Easter 2017, ECPL had a change of heart. It decided that rather than apply to redevelop Empress Place and Lillie Road, it should instead apply to refurbish the shops and Prince of Wales pub for temporary retail use of at least three years.

The planning application for the eastern block of Lillie Road, 2-14, would include a request to join the gardens at the rear of 7-11 Empress Place with the rear of the Prince of Wales pub to create a large open area with seating to accommodate diners and drinkers using the pub and outlets in the neighbouring buildings. Whereas, the refurbishment of the western block, 16-26, would stand alone.

By early May 2017, Capco had informed the LBHF planning officers of ECPL’s revised intentions and had begun commissioning the architectural and other building related work that would be required. Eventually, on 9 August 2017, ECPL’s planning consultant DP9 submitted a planning application to LBHF proposing “a temporary ‘pop-up’ operation for the commercial units at Nos. 2-26 Lillie Road”:

“The proposed temporary uses will create numerous job opportunities and the improvement to this local parade will improve the character and appearance of this part of Lillie Road for local residents and visitors to enjoy….The temporary ‘pop-up’ is proposed as a meanwhile use during the interim period before redevelopment proposals for Empress Place are finalised and secured through the planning process….creating high street uses that will improve the appearance of the immediate local area and draw footfall back to this part of Lillie Road”.

A restored retail hub with eateries and pub

“The transformation of 11 vacant units on Lillie Road into a temporary ‘pop up’ high street, with a mix of food & beverage and retail units to serve the local community and start communicating ECPL’s vision for the future of Earls Court as a vibrant and engaging place.” (ECPL’s architect’s project summary) Above: Computer generated image, for indicative purposes only, published by ECPL

The works to the properties will be superficial, including refurbishment of the facades and internal fit out with provision of ventilation ducting. Most of the upper floors will not be brought back into use: they will remain empty, locked up in the face of a debilitating current housing crisis. A single operator will manage the eastern terrace, with seating for up to 450 (sic) people in the extended pub garden; the western terrace will be let to individual retailers.

Routinely for Capco, security guards will play a major role, controlling overcrowding and restraining noise and anti-social behaviour from the public who use the new facilities. The 20-week contract for undertaking the works means it is unlikely the refurbished parade will be open before 2018.

So, why?

The pretentious language of a ‘revolving pop-up hub’ deserves derision, and the cynical rebranding of the high street and the pub warrants dismay. However, the temporary reprieve of the shops and houses, and the restoration of the parade for retail use is undoubtedly a great victory for all those who campaigned to preserve our heritage. But, while they deserve praise, there must be a suspicion that the developers’ motivations are other than driven by a desire to do the right thing.

ECPL may have appreciated that obtaining permission for a redevelopment requiring a material revision to the consented masterplan is more challenging than at first it presumed, and that in the absence of a quick redevelopment it would be better to avoid paying full business rates on the empty properties and instead generate an income.

Capco might have realised that the funereal hoardings showcasing dereliction directly opposite its Lillie Square showroom, and dominating the junction with Seagrave Road leading to Lillie Square, are an own-goal which cannot be helping sales of the flats it’s building there. Or perhaps, even, it dawned on Capco that it should give up trying to do something it’s not very good at – development – and revert to its core business – making money out of managing a shopping centre (viz. Covent Garden).

Whatever the explanation, there is no doubt that a property speculator trying to exit the largest and most complex urban redevelopment in the world outside of China would do well to tidy up the mess it’s made if it wants to command a premium, let alone convince anyone to take on such colossal risks.

We shall prevail

While the about-turn on Lillie Road (coupled with the recent refurbishment for use by the Fulham Boys School of the Capco-owned former Rootstein factory at the Northern end of the Opportunity Area) goes some way to easing Capco’s retreat, one certain fact remains indelibly engraved on the landscape: nothing will make the Earl’s Court scheme saleable so long as our estates are bound in to it, and so long as we maintain our deeply entrenched campaign to save our homes and protect our community.

Risks and rewards: latest goings on with Earl’s Court developer

Capco perceives our community as a risk to its reputation

Capco’s interim results, published on 21 July, show that the valuation of its Earl’s Court properties has decreased again, this time by 2.4%, which is on top of the 20.4% decrease Capco reported in February. However, the company appears to have returned to profit, having made a loss of £223 million for the year ended 31 December 2016.

Capco’s financial position was boosted by the sale of the Olympia exhibition halls. As the company eloquently explained: “Having extracted significant value from the venue since acquisition, Capco took the decision to exit this non-core asset”.

As for Earl’s Court, its results state: “Capco remains focused on maximising the potential of the strategic land holding . . . Accordingly, representations have been made by Capco to the GLA’s London Plan to deliver 10,000 new homes, an additional 2,500 homes above the current consented scheme”.

Reputational risks Linda and David at our Summer Picnic

Meanwhile, Capco still insists that our campaign to save our community is a risk that might damage its reputation or distract its management. Its measures for mitigation are to “review activity and communications of activist groups”.

But it seems the company is looking in the wrong direction. Arguably, one of the biggest risks to Capco’s reputation is not us, but its own formal association with the Kwok family, with whom it is in a 50/50 joint venture for the development of 808 homes in Seagrave Road, otherwise known as Lillie Square.

The Kwok Family Interests (KFI) are major shareholders of Hong Kong property developers Sun Hung Kai (SHK). In 2014, SHK Chairman Thomas Kwok and his right hand man Thomas Chan, at that time a Director of Lillie Square GP, were convicted of bribing the second most senior official in Hong Kong, Rafael Hui, with HK$8.5 million. Thomas Kwok was sent to prison for five years, and Chan for six years in what has been widely described as the highest profile corruption case in the city’s history.

After serving 18 months in gaol, Kwok was released on bail pending the outcome of his appeal. A month ago, five judges of the Court of Final Appeal unanimously dismissed the appeal, confirming that Kwok’s and Chan’s actions were corrupt. Chief justice Geoffrey Ma Tao-li said: “It will now be necessary for [Kwok] to return to prison for him to serve out the remaining sentence.”

Thomas Kwok clutches the Bible as he climbs into the prison van

Despite these facts, on the Lillie Square website Capco and KFI persist in describing Sun Hung Kai as “one of the most highly reputable real estate companies listed on the Hong Kong Stock Exchange”.

But that is not the only misleading information published about Lillie Square. In a full-page advert printed in the Evening Standard on 3 May 2017, Capco and the Kwoks claimed that the latest Lillie Square apartments have “views over the Lost River Park or the landscaped garden square”. The advert trumpeted the so-called Lost River Park as “Central London’s largest new park in 100 years”.

Advert in Evening Standard with misleading claims about the so-called Lost River Park

Well, not only is Burgess Park a mile closer to Charing Cross, it’s 50 times larger. And, as for the view from the new flats over the so-called Lost River Park, given that it is little more than a path only a few metres wide, those views would likely be limited.

Capco’s latest results show that sales at Lillie Square are little more than one per week. At that rate it would take a century to sell the consented scheme, let alone the 2,500 flats it wants to add. Could this explain what’s going on?

Locals prefer to preserve and extend Empress Place, while Capco keeps it empty in face of Grenfell Tower disaster

WKGGCH Board Members Baghdadi Daoudi and Linda Sanders display the results of the informal poll conducted on 29 April at the Spring Fair

In December 2016, Capco exhibited proposals to demolish the Victorian houses, which it had bought up in Empress Place. It wants to replace them with over 400 flats, including a 24-storey tower block. Despite announcing its intention to submit a planning application to Hammersmith & Fulham Council, so far it has not done so.

Empress Place consists largely of two-storey Victorian cottages, though, as can be seen at the right of the photo, it also includes the purpose-built engineering headquarters (1907) of the Brompton & Piccadilly Railway Company. It was from this building, with its large windows designed to provide as much light as possible for the draughtsmen, that the Piccadilly line was designed.

Well-known architect, Francis Terry, has prepared an alternative proposal that would achieve as many homes without demolition.

Francis Terry’s proposal to preserve and extend the heritage of Empress Place rather than destroy it

At the Spring Fair on 29 April, we asked people who visited our stall whether they preferred Capco’s proposal (A on the left of the board in the photo) or the alternative (B on the right). Just 10 people preferred Capco’s scheme against 462 who preferred Francis Terry’s alternative. Common responses were: “It’s a no-brainer” and, pointing at Capco’s proposal: “Who would want that?”

Francis Terry’s alternative plan for Empress Place would produce the same number of homes as Capco’s demolition plan

WKGGCH Chair, Keith Drew said: “What a beautiful and refreshing change to the characterless concrete and glass blocks proposed by Capco! Why can’t we have this instead of yet more tedious residential warehousing? It would enhance the charm and attractiveness of our neighbourhood as well as provide much needed additional housing.”

Capco ignores plea to house Grenfell families in empty homes

On 16 June, following the terrible fire at Grenfell tower that made so many households homeless, Linda Wade, Councillor for Earl’s Court, said: “26 homes [owned by Capco] in Empress Place stand empty. I am sure that Earl’s Court developers Capco wish to support Grenfell Tower survivors.”

Meanwhile, in response to the Grenfell disaster, our Tenants & Residents Associations, led by Sally Taylor and Diana Belshaw, have mobilised a powerful effort to support those families directly affected, including providing food, clothing and housing support.

Capco’s response to this tragedy on their doorstep? A deafening silence.

Alternative Earl’s Court plans preserve estates and bring back exhibition venue

On 18 May, University College London’s Bartlett School of Planning displayed eight alternative masterplans for the Earl’s Court and West Kensington Opportunity Area.

Each masterplan, prepared by groups of up to four students from the third year and master degree courses, led by tutor Dr Juliana Martins, presented ideas for developing the area very different to the masterplan created by Sir Terry Farrell on behalf of Capco.

Unlike that plan, most of these plans incorporated all or part of the West Kensington and Gibbs Green estates and re-introduced a major cultural and exhibition facility directly accessible from Earl’s Court station.

Far from being solely based on demolition and luxury flats, some of the plans preserved the historic railway sheds and established a centre for transport engineering excellence, building on the legacy of the Lillie Bridge Rail Underground Maintenance Depot and the Transport for London Training facility at Ashfield House.

Both the London Mayor, Sadiq Khan, and developer Capco have said they want to review the masterplan for the wider area, amid common agreement that the consented plan for Earl’s Court is not fit for purpose. These fascinating and imaginative contributions show that masterplanning is not the preserve of celebrity architects or self-interested developers. There is an alternative, and there is a better way.

Course Tutor Dr Juliana Martins explains the masterplanning exercises to Robin Hawkes, WKGGCH Board Member

Student Sam (right) explains his masterplan to WKGGCH Board Member Dioscore (left)

Professor Michael Edwards (centre) with Anabela Hardwick (right)

London Blogger Dave Hill talks with West Kensington estate TRA Chair Sally Taylor

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