May elections and the outcome for construction

After eight years of Boris Johnson occupying the top seat in London’s City Hall, and many Evening Standard front pages, the electoral landscape was altered overnight in May’s local election as Sadiq Khan reclaimed a Labour majority in the capital. Enjoying a 13.6% margin of victory over his nearest rival, Conservative Zac Goldsmith, the new mayor now has to prove he can put his manifesto promises into practice.

Housing was at the top of Labour’s priority list during the election campaign, although developers in London are now expecting a different approach to building and construction. Its policies rest heavily on boosting affordable housing provision, unlike the Conservatives who only provided 22,000 of the 55,000 affordable homes promised by 2015.

Many have welcomed Khan’s pledge to set up a construction academy to combat the industry’s skills shortage, but have also warned that his 50% housing target is “unworkable”. And while his commitment to reasonably-priced housing for average wage earners is commendable, critics say that this could be inhibited by his cautious approach to planning.

The pledge could also have an adverse effect for those in the industry – proposing that half of new homes built on brownfield sites be affordable will make many sites financially unviable for investors, with knock-on effects created down the supply chain.

Khan’s proposals, no doubt laid out with the best intentions, are likely to have the most detrimental impact on small developers and contractors – many are calling for a ‘small site exemption’. The next four years will be a real test, to see if he can deliver on his promises while also keeping on the right side of those who will be delivering the new housing that has been pledged.