Making Space: Accommodating London’s industrial future

Industrial land is crucial to London’s economy but over the last two decades too much of this land has been lost. This report explores the future of London’s industrial land.

In twenty years, almost a quarter of the city’s industrial space has been converted for other uses such as housing, leading to the knock-on effect of rising land values and rents, squeezing out businesses and causing job losses.

The Industrial Land Commission, chaired by leading property industry expert Liz Peace CBE and convened by Centre for London, raises the alarm over the loss of industrial land across London and the UK’s biggest city regions.

The Commission’s final report found that over the last 20 years, London lost a quarter (24 per cent) of its industrial floorspace while Greater Manchester and the West Midlands saw theirs decrease by a fifth (20 per cent and 19 per cent respectively).

The value of industrial land to London’s economy

The Commission argues that London cannot afford to lose any more industrial land. Jobs in traditional industrial activities such as manufacturing, repair and warehousing are worth more than £78 billion to the city’s economy, but the true figure is likely to be even higher as this excludes non-industrial activities such as most creative industries. The Commission’s report highlights that the number of jobs that rely on industrial land is actually increasing, with local employment opportunities being created at all skill levels, and the potential to host up to 12,000 new green jobs.

With the situation now critical, the commission warns against the further loss of industrial land and calls for urgent action to address London’s industrial land shortage, support businesses and protect jobs. To address London’s industrial land shortage, the Commission proposes a three-pronged approach:

Key recommendations

1. Enhance local planning, protection and flexibility. The Mayor of London and London boroughs already have strong powers to retain industrial space through the planning system, but the losses of industrial space witnessed over recent years suggests they have not been using their powers to protect this land as much as they could have done. London boroughs urgently need to step in to ensure there is sufficient and suitable industrial accommodation on ‘their patch’.

2. Provide more industrial accommodation. The Mayor of London and London boroughs should co-invest in developments that intensify remaining industrial land such as multi-storey warehouses, or that provide industrial space in new locations.

3. Improve representation. The Commission recommends an independent and influential representative body is set up by businesses to make the case for London’s industrial spaces, inform planning policy and raise the profile of industrial activities. The Mayor of London should also appoint a powerful champion in City Hall for industrial land alongside supporting local authorities to upskill their staff working with industrial land.