Crossrail 2 is a proposed new railway, using a tunnel through London to link the rail networks in Surrey and Hertfordshire. It would connect the South Western Main Line to the West Anglia Main Line, via Victoria and King’s Cross St Pancras, with the intention to alleviate severe overcrowding that would otherwise occur on commuter rail routes into Central London by the 2030s.
The current proposals anticipate submission of an application for planning consent in 2020. However, the new rail route is already the subject of safeguarding, and this may have the effect of effectively prohibiting certain types of development along the route. Clearly, this is causing some concern among real estate investors and developers. Worse still, the safeguarded route has yet to be finalised, and this is causing additional uncertainty over development proposals and the tenanting of buildings on safeguarded (or potentially safeguarded) sites.
The Crossrail 2 scheme is intended to be delivered by an Act of Parliament, rather than as a nationally significant infrastructure projects (NSIPs).
Until the draft legislation is published there will not be any certainty on the final proposals. It is at that point that the companies affected by the project can begin to negotiate protective provisions in an effort to minimise the real impact on them.
So uncertainty is currently the order of the day. We are seeing an increasing number of clients approaching us for advice on the impact of Crossrail 2 on maintaining or expanding their real estate portfolio. At this stage of the process, we are often left with little scope for meaningful advice other than to highlight worst case situations and potential impact on value – so as to provide at least some certainty in deal negotiations.
Mark Howard is a Partner at Michelmores LLP Solicitors. He has acted for a number of clients in relation to infrastructure schemes, including Crossrail. He has commented upon and drafted legislation, negotiated with scheme promoters, drafted Petitions to Parliament, and dealt with House of Commons Select Committee to secure protective provisions for affected clients. He acted as a Parliamentary Agent for the previous Crossrail scheme.
