East London attracts EUR 2b ahead of Olympics: CBRE

At least £1.6 bn (EUR 2 bn) of private sector money has already been invested in East London over the last two years, according to research by CBRE, with the site seeing the delivery of over 6,000 homes and 3 million sq ft (280,000 m2) of commercial space.

Overseas investors in particular have recognised the long-term investment opportunity that Europe's largest regeneration project presents. As a result, the majority of East London's large assets have been funded, or acquired, by international capital from countries such as Australia, Canada, the Netherlands, Qatar, Sweden and Germany.

APG, the Dutch pension fund, along with the Canadian Pension Plan Investment Board, jointly purchased a 50% stake in Stratford City for £870 mln and Qatari Diar partnered with UK developer Delancey to acquire the Athletes Village for £557 mln. Outside Stratford, Germany's Deka purchased Pier Walk Greenwich for £97 mln and Sweden's Inter Ikea has assembled around 29-acres of redundant industrial land on Sugar House Lane for £2 mln, which is the second largest private sector land holding behind Westfield in the locality.

Development has continued apace in the Olympic boroughs despite the economic downturn, against a backdrop of stifled progress across the rest of the UK due to problems with securing funding and finance. Inter Ikea's Sugar House Lane will be transformed with 1,200 homes, 400,000 sq ft of commercial space and a 350-bed Marriott Hotel, a £60 mln urban sustainability 'Crystal Knowledge Hub' has been constructed by Siemens in the Royal Docks and Chelsfield have plans for a 2.5 million sq ft retail pavilion concept at Silvertown Quays.

'A lot of people are wondering what will happen to East London after the Olympic Games, but it is clear that there is already a substantial amount of activity,' said Matthew Black, head of East London, CBRE. 'The Olympics is just the beginning, enabling the regeneration of an area that could never have occurred in the present global economic climate.'

Stratford City alone will offer a total of 13 million sq ft of mixed-use development with the Royal Docks providing a further 100 acres of mixed-use development potential.