Home Property Will the new DLR line create an East London property boom?

Will the new DLR line create an East London property boom?

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26th Sep 11 10:21 pm

Will the new railway quietly connecting the capital to Westfield Stratford City and Stratford International present investment opportunities?

One end looks like the sort of place where East End villains dispose of their unwanted business associates. The other end looks like a futuristic town.

Welcome to London’s newest bit of transport infrastructure: the Docklands Light Railway line between Stratford International and Canning Town. A year late, but it’s now here.

DLR details – Stratford and beyond

New DLR service runs from Stratford International due south to Canning Town. This connects the new Olympic park with the line to Woolwich Arsenal via London City Airport or the Easterly line to Beckton – ideal for getting to the Excel exhibition centre.

The new stations on the new line are at Stratford High Street, Abbey Road and Star Lane, and it also calls at the existing West Ham station.

It also serves the Westfield Stratford City shopping complex, which opened on Tuesday, and opens up for property development a swathe of derelict land to the line’s immediate west between Stratford High Street and Canning Town, until now one of the capital’s least accessible corners.

  • Watch our interview with Boris at the Westfield Stratford City opening

Property potential

The property industry is abuzz with interest. New stations mean more traffic. Naturally developers are looking all along the new line to try and sport opportunities for residential and commercial investment.

Indeed IKEA is already there, planning its first housing estate outside Sweden adjacent to its proposed store at Sugar House Lane.

East of the line are clean, quiet streets of Victorian terraces, low rise council blocks and the occasional tower block, all no doubt due to see their prices rise.

To the west though is a weed-infested wasteland with the occasional scrapyard or storage depot, which developers will now have their eyes on.

London Assembly member John Biggs forecasts a big impact: “The additional links and stations will, gradually, given the current state of the markets, raise the attractiveness of housing and other investments in the wider area.”

Local property specialists broadly agree. Stefan Przepiora, sales manager at estate agent Winkworths’ Stratford branch, says: “This has been a rather down at heel area, with a lack of decent bars and restaurants but with Westfield opening you will get those coming in.

“Once people see it you will start to get price rises because Stratford is ridiculously cheap at the moment compared with the rest of London. You can get a three bedroom family home with a garden round here for £280-290,000 now.”

Kieran Wheeler, a director, of property firm Savills, expects it to see buy-to-let investors soon.

He explains: “I imagine development there will be a combination of flats and family housing there because the council is keen on getting more family homes, but to realise value for the land you are going to need some higher densities so many new properties will be flats.

“Buy-to-let seems to be very popular in those kinds of areas and we’ve been working elsewhere in Docklands with Bellway, which has been selling the majority of its stock to buy-to-let investors at present.”

  • For more on the buy-to-let craze: A nation of landlords?

Wheeler says the Stratford High Street stop, in an area filled with residential tower blocks with commercial use sat their base, “is fairly well developed area but there is probably some opportunity, but the other two new stations are better placed because land prices will be cheaper, so we will probably see brownfield land regenerated there”.

He adds: “We always find when a new station turns up the first people in there are the house builders, because nothing is going to happen without people living there, but once the homes are there you will start to get some commercial and retail development too.  The house builders will have been looking for options around those new stations.”

Karen Charles, planning director at the DTZ property firm says: “There is a lot of brownfield sites that have not in past attracted business and investment because they have had only limited accessibility.

“I imagine the council will want to change the mix of housing there, as you have a lot of affordable housing already, so it may not seek a high element of affordable homes in developments.

“They will probably want some nice market housing in there. Given where it is, that is not likely to be luxury housing, not real high-end stuff but something better than it has at the moment.”

Stratford’s Euro millions?

The area’s connections are now good, but it could also be less than two hours from Paris and Brussels were Eurostar to stop its trains at Stratford International, which despite the name is served only by the high-speed services from St Pancras to Kent.

Przepiora says: “The link to Europe would transform this area because it would be the first stop for businesses arriving from Europe, and the price of land for business here is way lower than at St Pancras or Canary Wharf. There is fantastic potential.”

Eurostar does not want to begin stopping services at Stratford only to have to withdraw them again when the Javelin trains for the Olympic Games take up the station’s capacity next summer.

A spokesman says it will “reconsider stopping at Stratford after the Games”.

Right now taking the DLR to Stratford International is one of few legal ways to see part of the heart of the Olympic Park.

But during and after the Games it will be the station that serves one of London’s most rapidly growing areas and, who knows, even workaday Canning Town may become a fashionable district.

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