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Published On: Thu, Jan 21st, 2016

£1.3 Billion in Residential Value Hidden in London

There is currently £1.3 billion in potential real estate revenue locked in car parks throughout the city of London, which would make ideal space for residential properties.

This information was revealed in a new study conducted by Pastor Real Estate. Parking to Penthouses has discovered that £1.3 billion in potential land value is occupied in 18 operational multi-storey car parks all across Marylebone and Mayfair. These car parks are home to more than 4,000 parking spaces, which is more than is needed for the demand for parking in the area.

The potential for property developers to use this land in a more effective way is huge, especially since the demand for properties across Mayfair has continued to increase by up to 10% each and every year.

David Lee, head of sales at Pastor Real Estate, commented: “Increasingly we’re seeing a number of developers turn to car parks in the search for viable residential land in prime central London. Whilst fully operational car parks can offer a good return, the high demand for new homes in London makes these sites increasingly more attractive as a luxury residential development.”

The study has shown that many of the people living in the Mayfair area do not require the parking spaces that are provided. They are usually students from wealthy families or international business people who use simply require a “bolthole” in the capital city. When the report looks closely at this section of the population, it highlights that 64% do not own a car. Also, the number of people between the ages of 17 and 20 who possess a full driving licence has fallen by 16%.

This photo was taken on June 9, 2012 in Bermondsey, London, England, GB, photo/Martin Hesketh

This photo was taken on June 9, 2012 in Bermondsey, London, England, GB, photo/Martin Hesketh

London is evolving and the urban population is getting younger and their dependency on cars is decreasing as transport connections continue to improve. This has seen the need for parking in central London decline, whilst the new housing will be a pressing concern in the capital for the foreseeable future,” says Mr Lee.

The reasons for these changes can be seen as cultural. More people are starting to use public transit on a regular basis and there has been an increase in cycling and other alternative modes of transportation. Also, many people have avoid using vehicles in the centre of London due to the expensive congestion charge.

Mr Lee added: “As the demand for prime London property continues to out-strip supply, identifying development opportunities that add value to the neighbourhood, provide high-quality residences and essentially prove commercially viable will become a pressing concern for central London developers. Throughout the report we have identified a number of strategic car park sites that could now be more viable and better suited as a residential or mixed-use development.”

The study looked closely at 18 different car parks in Marylebone and Mayfair, which are responsible for a major percentage of the figure of 1.3 billion pounds. If these car parks were turned into residential properties, their land value would be enhanced by 300%. Given the decreased demand for parking spaces, this is an idea that makes a lot of sense for property developers who are looking for new places to build.

There is already an initiative in place to transform Audley Square, which is a multi-storey car park that is located in the heart of Mayfair. The plans are to turn it into a two billion pound residential property, as long as the planning approval for the project is granted. The build will include three mews properties, five town-houses and 21 apartments, as well as luxury penthouses. It will fit neatly into the existing portfolio of the area. There are also several other well located car park sites that could be ideally converted into residential developments.

These transformations offer a lot of potential, considering this is one of the most profitable areas for investment by property developers.

Guest Author: Kayleigh Stubbs

Photo/Andrew Dunn, 29 September 2004 via wikimedia commons

Photo/Andrew Dunn, 29 September 2004 via wikimedia commons

A multi segment panoramic image of the London skyline from the Bermondsey banks of the Thames. 2008 Photo by DAVID ILIFF

A multi segment panoramic image of the London skyline from the Bermondsey banks of the Thames. 2008 Photo by DAVID ILIFF

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