Brentford 2019 Focus On: Brentford

RESEARCH

FOCUS ON: BRENTFORD 2019 FOCUS ON: BRENTFORD

Brentford, a riverside former industrial area situated among London’s expansive green spaces, is set to become one of the capital’s largest waterside regeneration hubs.

The district occupies a key strategic culminating in the opening of the train line position for businesses and residents due linking Brentford to Heathrow Airport and to its historic connectivity via water, road London’s West End, and the 1965 opening and rail. of the elevated section of the M4 motorway.

Brentford, TW8, was a key interchange As a result, company headquarters in TW8 joining the Grand Junction Canal to the and the surrounding postcodes proliferated River Thames during the late 1700s and over subsequent years. Now, Brentford early 1800s, and its connectivity expanded is designated in the draft London Plan, during the following two centuries, the mayor’s strategic document, as a key centre with high growth-potential in both commercial and residential property sectors. FIGURE 1 Average homes in Brentford sell at lower capital values to neighbouring locations Year to end Apr 2019 ECONOMIC GROWTH Brentford sits in the borough of Hounslow, Acton where gross value added, a measure of Higher economic growth, is forecast to grow more than 20% in the coming decade, while employment is forecast to rise 8%.

Lower TW8 and its neighbouring postcodes are home to a variety of large company Chiswick headquarters due to ease of access into central London and Heathrow. They are mostly positioned close to the M4, and at nearby Chiswick Business Park, which is home to a plethora of oil and gas, media Brentford and technology companies. The largest employers include pharmaceutical company GSK, oil and gas firms Tullow Oil and Worley Barnes Parsons, and Qatari media company Fadaat (fig 2). Other major local employers include telecommunications giant Sky and computer game developer Sega. Isleworth Hounslow, already a hub for the creative industries, has been named as one of London’s first Creative Enterprise Zones. This entitles the borough to receive Mayoral Richmond upon Thames funding in order to foster growth across the creative sectors.

Significant levels of new office construction are underway across Chiswick, Hammersmith and Ealing to accommodate new businesses moving to the area. Now,

Source: Land Registry more than one million square feet of new

2 RESEARCH KNIGHT FRANK FOCUS ON: BRENTFORD 2019

office space is due to complete between neighbouring towns of Chiswick, Barnes The draft London Plan suggests 2,182 2019 and 2022, as developers anticipate and Richmond upon Thames (fig 1) and homes must be built in Hounslow every growth in local employment, according to average sales prices in TW8 during the year over the coming decade in order to Knight Frank Research. past 12 months were the lowest of any meet new demand and clear a backlog of riverside postcode in west London. undersupply (fig 3). Hounslow Borough Council’s local plan suggests the current Total housing stock in Hounslow pipeline will result in the delivery of RESIDENTIAL expanded by 991 units in 2017- approximately 2,400 homes in 2019/20 DEVELOPMENT 18, according to official figures. and 2020/21, hitting its minimum target, With a large number of global office Housebuilding in the borough needs to before dropping back to 1,700 the tenants nearby and high levels of more than double if it is to meet the needs connectivity with central London and following year and plateauing in that of the growing population, according Heathrow, TW8 is becoming a focal point region until 2026/27, settling at around to the draft London Plan. By 2029, the for residential development. 80% of its target. local population is forecast to grow by Homes in Brentford typically sell at more than 25,000 to 307,000, a 9% rise, Much of the growth in future housing in relatively lower capital values to the according to Experian. the borough will take place within 1.5km

FIGURE 2 Largest employers in TW8 and surrounding postcodes* Number of employees working on site

Advertising

Infinity Bus & Coach Operators Media & Stations Group

Computer Games

Consulates and Embassies

Education

Facilities Management

Finance

Food

Media

Oil & Gas

Mail Order & Shipping

Pharmaceutical

Retail

Transportation

Source: EGi *Includes W4, TW9, TW7, W7, W13, W5, W3, not exhaustive

KNIGHT FRANK RESEARCH 3 FOCUS ON: BRENTFORD 2019

of Brentford Station, where approximately gardens and woodland lie within 20 minutes’ 3,350 homes are either under construction, walk of Brentford Station, and more than 750 Green space accessible within 20 minutes of Brentford Station or have consent, and are likely to be hectares are accessible via 20 minutes on delivered over the next five years or more. public transport, which takes in the historic Average upper quartile asking rents for a Syon Park and the Royal Botanic Gardens, two-bedroom flat in the prime market – Kew. Almost 2,500 hectares are accessible in defined as the top 25% by value – stood at 20 minutes by car, which takes in London’s £2,450 per calendar month during Q1 2019. Richmond Park – the largest of London’s Royal Parks. The TW8 postcode also boasts AMENITY 1.9 miles of river frontage. With new development often comes London’s top universities are all within new amenity. Brentford high street is set an hour’s journey of Brentford Station to be overhauled, with 140,000 square (fig 4 overleaf) and TW8 and its bordering feet of new retail and leisure space. This postcodes have 13 primary schools and will include shops, bars and restaurants four secondary schools rated ‘outstanding’ 150 Hectares split across approximately 40 units. The by the education watchdog Ofsted. new high street will add to the choice for The Greater London Authority and 750 Hectares shoppers that already includes nearby Hounslow Council are also funding an Richmond, Hounslow and Chiswick, which overhaul of former barge sheds straddling are respectively ranked 9th, 11th and 33rd 2,500 Hectares the Grand Union Canal to celebrate the in retail consultancy CACI’s rankings of the area’s industrial heritage. Other areas of nation’s Metropolitan retail centres. interest include the soon-to-be-completed Brentford is also positioned among swathes Brentford Community Stadium, the 17,250 Source: Knight Frank Research of green space. Almost 150 hectares (370 capacity home of Championship team acres) of open green space, including parks, Brentford Football Club.

FIGURE 3 Housing supply, Hounslow Historic delivery and projections

3,000

PROJECTIONS FROM HOUNSLOW LOCAL PLAN AUTHORITY MONITORING REPORT, †‡ˆ/‡Š

2,500 Annual housing supply target 2018-19 to 2028-29 Source: Draft London Plan

2,000

1,500 NET ADDITIONAL DWELLINGS No. of dwellings No. Annual housing supply target,2014-15 to 2017-18 1,000 Source: Current London Plan

500

0 2017-18 2010-11 2011-12 2012-13 2016-17 2013-14 2015-16 2014-15 2018-19 2021-22 2020-21 2019-20 2022-23 2009-10 2026-27 2023-24 2024-25 2025-26

Source: MHCLG, London Borough of Hounslow

KNIGHT FRANK RESEARCH 4 FOCUS ON: BRENTFORD 2019

FIGURE 4 CONNECTIVITY Travel times, Brentford Station to places of interest Brentford has a mainline station with direct trains to London Waterloo in 30 : minutes. Piccadilly Line station Boston NS C NS Manor sits on the fringe of TW8, with NS trains running direct to Knightsbridge, King’s Cross St. Pancras and Heathrow. NS The M4 motorway runs through NS Brentford, and easily connects to the M40, a motorway linking London to Heathrow Airport NS NS Oxford and Birmingham, and the A40, a London Waterloo major trunk road connecting London to Bond Street NS NS Wales and the West Country (fig 5). City of London The Mayor’s transport strategy also NS Imperial College includes proposals for a new passenger service between Hounslow Station Canary Wharf NS and Old Oak Common, a key transport UCL interchange on both the east to west London School of Economics and Political Science Elizabeth Line and proposed High Speed NS 2 line to Birmingham, the East Midlands, King’s College London Leeds and Manchester. Gatwick Airport NS Oxford

Source: TFL, Google

FIGURE 5 ACTON Connectivity:West Middlesex Brentford and surrounds Ealing Broadway Golf Course A4020 A406 A4000

South Ealing Acton Town A3002 Northfields South Acton Gunnersbury Boston Manor Park A406

M4 Chiswick Park M4 Gunnersbury Osterley Park Kew Bridge Brentford A4 THE WEST END A4 BRENTFORD A316 Osterley Syon Lane Chiswick A315 A205 A4 Royal Botanic Gardens Kew Gardens A310 A3005 A307 ISLEWORTH

Royal Mid-Surrey A3003 Golf Club A316 HOUNSLOW MORTLAKE North Sheen

A314 A310 A3004 RICHMOND Hounslow

A316 St Margarets

5 RESEARCH KNIGHT FRANK FORECASTS “WITH A LARGE NUMBER Knight Frank forecasts house prices in is well placed to gain from the uplift in OF GLOBAL OFFICE Greater London will climb 9.2% between high-quality new residential and retail TENANTS NEARBY 2019 and 2023. Brentford, with its development slated for the next five years, connectivity to central London and beyond, which in turn is likely to attract further AND HIGH LEVELS OF ample river frontage and green space, new amenity. CONNECTIVITY WITH CENTRAL LONDON AND HEATHROW, TW8 IS BECOMING A FOCAL POINT FOR RESIDENTIAL 1.9 DEVELOPMENT.” Patrick Gower, Residential Research % % [email protected] 9SALES 16RENTS If you would like further insight into residential markets please get in touch. KNIGHT FRANK HOUSE PRICE GROWTH MILES OF RIVER FRONTAGE, TW8 FORECAST, GREATER LONDON, 2019-2023

£2,450 BRENTFORD AVERAGE PRIME* ASKING RENT, TWO BED FLAT, Q1 2019 NUMBER OF OFSTED RATED ‘OUTSTANDING’ PRIMARY AND SECONDARY SCHOOLS IN TW8 AND NEIGHBOURING17 POSTCODES**

Sources: Knight Frank Research, Rightmove, Ofsted *Prime is defined as the top 25% of homes by market value **Postcodes TW8, W4, TW9, TW7, W7, W13, W5, W3

Cover image is a CGI of The Brentford Project, courtesy of Ballymore

Knight Frank Research provides strategic advice, consultancy services and forecasting RESIDENTIAL RESEARCH RESIDENTIAL RESEARCH RESEARCH PRIME LONDON RESIDENTIAL DEVELOPMENT SALES INDEX LAND INDEX to a wide range of clients worldwide including

POLITICAL UNCERTAINTY WEIGHS LONDON ON LAND VALUES Economic uncertainty coupled with the complexities of the planning developers, investors, funding organisations, EASTERN system and rising build costs exerted pressure on land values at the turn RESIDENTIAL of the year. However, developers seeking to maintain a healthy supply of land and take advantage of value prompted ultra-competitive bidding for DEVELOPMENT OPPORTUNITIES a handful of the best sites on the market. 2019 Housebuilders sought to protect their This trend is being mirrored in prime H1 2019 Key Facts Q1 2019 margins to account for future risks central London, where values dipped The prime London sales indices are based on repeat valuations of second-hand stock and do not JUNE 2019 include new-build property, although units from completed developments are included over time. Average greenfield development land during Q1 2019, particularly in the South 2% during Q1 and declined 7.5% during the East. Consequently, average greenfield year to March. corporate institutions and the public sector. prices declined 0.6% in the year to PRIME CENTRAL LONDON development land prices declined 0.3%, Q1 2019, the first annual decline in Demand has been robust for competitively- taking the annual change to -0.6% - the two years priced sites in the best locations with rental first annual decline in two years. Prime central London index | 5,571.2 Annual change | -4.9% Quarterly change | -0.7% Monthly change | -0.3% income already in place, though in the wider prime central London land market investors Urban Brownfield land values climbed Construction costs, including materials, are grappling with how to accurately price PRIME OUTER LONDON 0.8% during Q1 2019, moderating the plant and labour, have climbed 14% over the past three years, according to the sites amid so much political uncertainty. annual decline to 0.2% | | | | ONS. Any further weakening of the pound In addition, the risk of planning delays in Prime outer London index 267.8 Annual change -4.1% Quarterly change -0.2% Monthly change -0.2% could make importing building materials All our clients recognise the need for expert central London has grown in the past two Prime Central London development more costly, which could be compounded years. Councils and the Greater London land values declined 2%, taking the by reported Brexit-related stockpiling. Authority at times have differing priorities FIGURE 1 FIGURE 2 annual decline to 7.5% However, the most significant factor regarding the proportion and mix of tenures Figure 1 Between March 2009 and the last weighing on greenfield land values is market peak in August 2015, average price Lower pricing volatility in higher price brackets Sales volumes decline by less above £10 million required when negotiating section 106 Average price change by price bracket Year to May 2019 vs year to May 2018, % change housebuilders’ caution over possible agreements, which adds another layer of growth above £10m in PCL was half of that conditions in the sales market in three to complexity in an already challenging prime recorded for properties worth less than five years’ time due to the acute political central London market. £2m. As prices adjust to political uncertainty March 2009 to August 2015 August 2015 to March 2019 uncertainty in Westminster. and tax changes, this relative difference in Urban brownfield land values climbed 0.8% 0% independent advice customised to their performance has helped underpin demand 120% As a result, competition has been -2% in Q1, taking the annual change to -0.2%. in higher price brackets. 100% particularly strong for well-connected sites The lack of clarity caused by events in 80% -4% with strong demographics, often on the Westminster is being offset by the certainty 60% Figure 2 The number of transactions above -6% edge of market towns. Volumes dipped provided by the Help to Buy Equity Loan 40% £10m fell 3.6% in PCL in the year to May -8% during the 18 months following the 2016 scheme, which the government announced 20% compared to the previous 12 months. This -10% referendum and housebuilders are now in November will be extended to 2023, albeit 0% compared to a decline of 11.5% between -20% -12% seeking to replenish their land supply. with regional price caps. Up to £1m to £2m to £5m to £10m+ £1m to £2m to £5m to £10m+ £1m and £2m, underlining the relatively £1m £2m £5m £10m £2m £5m £10m stronger performance of the higher-value Source: Knight Frank Research Source: Knight Frank Research / LonRes specific needs. FIGURE 1 FIGURE 2 market. Residential development land prices Annual change in average land values Rebased 100 = Sep 2011 (Urban Brownfield = Dec 2014) Figure 3 Average prices above £10m FIGURE 3 FIGURE 4 Stock declines as demand rises Prime Central London Urban Brownfield Prime Central London Urban Brownfield declined 2.5% in the year to June and it has Price declines lower in higher price brackets English Greenfield English Greenfield Average annual % change by price bracket Annualised % change been 46 months since prices last peaked in 150 10.0% this price bracket. The decrease was 4.8% Up to £1m £1m to £2m £2m to £5m PCL POL New prospective buyers 7.5% £5m to £10m £10m + PATRICK GOWER 140 between £1m and £2m and it has been 39 5.0% Months since last peak 25 Associate, UK Residential Research months since the last peak, highlighting the 20 130 2.5% longer adjustment period for higher-value 2% 15 0.0% properties. 0% 10 “ Developers seeking to 120 5 Index -2.5% -2% 46 maintain a healthy supply Figure 4 Supply is shrinking in all price 0 48 of land... prompted ultra- 110 -5.0% -4% -5 brackets as some vendors hesitate due to 47 39 -10 -6% competitive bidding for a -7.5% political uncertainty. Meanwhile the number 37 -15 100 handful of the best sites -10.0% of new prospective buyers rose by 21% -8% -20 90 -12.5% in the year to May, showing how active

on the market during Q1.” Jul-18 Apr-18 Apr-19 Jan-18 Oct-18 Jan-19 Apr-18 Apr-19 Jun-18 Jun-19 Mar-18 Mar-19 Feb-18 Feb-19 Oct-17 Oct-18 Jun-17 Jun-18 Jun-19 Aug-18 Sep-18 Dec-18 Nov-18 Feb-18 Feb-19 Aug-17 Dec-17 Aug-18 Dec-18 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 May-18 May-19 2011 2012 2013 2014 2015 2016 2017 2018 2019 vendors currently benefit from an imbalance 2017 2018 2019 @patrickgower between supply and demand. Source: Knight Frank Research Source: Knight Frank Research / Rightmove [email protected] Source: Knight Frank Research Source: Knight Frank Research London Residential Eastern Opportunities UK Res Dev Land Index Prime London Sales Development H1 2019 2019 Q1 2019 Index - June 2019 Get in touch If you’re thinking of buying or selling, Knight Frank Research Reports are available at KnightFrank.com/Research or would just like some property advice, please do get in touch. Important Notice © Knight Frank LLP 2019 – This report is published for general information only and not to be relied upon in any way. Priya Black Although high standards have been used in the preparation of the information, analysis, views and projections presented in this report, no responsibility or liability whatsoever can be accepted by Knight Frank LLP for any loss or damage resultant +44 20 7861 5489 from any use of, reliance on or reference to the contents of this document. As a general report, this material does not necessarily represent the view of Knight Frank LLP in relation to particular properties or projects. Reproduction of this report [email protected] in whole or in part is not allowed without prior written approval of Knight Frank LLP to the form and content within which it appears. Knight Frank LLP is a limited liability partnership registered in England with registered number OC305934. Our registered office is 55 Baker Street, London, W1U 8AN, where you may look at a list of members’ names.