Yahoo Finance Blackwall Reach development: Hundreds of London flats being built on former council estate marketed to wealthy Far Eastern investors
Hundreds of apartments being built on a site that includes a former east London council estate are being marketed to wealthy Far Eastern buyers as a “high-yielding investment”.
Flats at the £300 million Blackwall Reach development in Blackwall, which is replacing the Robin Hood Gardens estate, have been advertised as “best value” flats with prices starting from £565,000 for a two-bedroom home.
High-profile launch events in Hong Kong and Shanghai hotels followed a three-month “window” for local buyers — when just 17 were sold out of more than 800 earmarked for private sale.
Tower Hamlets council and developer Swan Housing face allegations that they are prioritising overseas investors ahead of the needs of locals.
A spokesman for campaign group Generation Rent said: “Given the scale and depth of the London housing crisis, we need genuinely affordable rentals.
As soon as your business plan is to flog them off overseas first, they are investments rather than homes for social need.”
Peter Golds, leader of Tower Hamlets Conservative group, said: “The council has more than enough funds to develop this site for affordable and social housing. It should be done now. If Tower Hamlets is dithering the Government should force them to release these homes for local people.”
The new development will feature 561 rented apartments and 118 for shared ownership, but the rest of the homes are being sold to private buyers.
Brochures at the launch events say investors can expect £545 to £830 a week in rent, equivalent to a return of 4.2 to five per cent. Average pay in Tower Hamlets last year was £32,581, or £626 a week.
A Tower Hamlets council spokesman said: “The sale is of entirely private properties rather than the enhanced social rent properties which remain for rent by local residents at Blackwall.”
Borough mayor John Biggs added: “The overseas marketing of these homes just goes to show the housing market is broken. It can’t be right that to pay for social homes we have to sell private homes overseas.”
Swan Housing Association said it “has complied fully with the Mayor of London’s Concordat [on] the sale of properties overseas.
“The agreement between the Greater London Authority, council and Swan has strict protocol, stating these properties were to be marketed exclusively to those living or working in Tower Hamlets for a three-month period, followed by a further three-month period when properties were marketed exclusively to those living or working in London, before being marketed overseas.”
A spokesman for Sadiq Khan said: “The Mayor has been entirely clear he wants Londoners to have an opportunity to buy homes first, before they are marketed overseas, and this was the case with Blackwall Reach.”
Demolition of the estate began in September after a failed attempt by the Twentieth Century Society to have it listed for its Brutalist architecture.
