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Heathrow Airport Set to Submit Planning for Expansion Later This Year

Despite recent comments from the Prime minister, Heathrow Airport is ploughing ahead with its plans to expand. The company is set to submit planning for expansion later this year and they want full government backing. So, what is the planned expansion and why has Boris Johnson potential scuppered the airline’s

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Potential Sites for Heathrow Expansion Progressed to Next Stage

A total of 65 potential sites have progressed to the next stage of consideration for the new offsite construction centres at Heathrow, with the final four sites being identified next year following the completion and assessment of a pre-qualification questionnaire (PQQ). They have until the 18th of January to make

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Heathrow Airport Reveals 7% Rise in Cargo Volumes

Heathrow Airport has revealed that cargo volumes have increased by 7% as it is buoyed by the expansion decision. The rise has capped a buoyant month for the transport hub after the government decided to expand the airport at the end of last month. Heathrow officials said that cargo volumes

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Heathrow CEO Hails Support for Expansion

The Chief Executive of Heathrow Airport John Holland-Kaye has hailed what he calls the ‘broad support’ that expansion at the London airport has throughout the country just as the government prepares to make a final call on the scheme. Coming at the same time as the airport announced figures that

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Savills Admits Concerns At Heathrow Despite Strong Demand

According to global real estate services provider Savills, the take-up of warehouse space around Heathrow Airport amounted to 1.14m sq ft (105,909 sq m) in 2015, a significant 17% drop from the previous 12 months. Availability across the airport presently stands at 2.07 million sq ft (192,309 sq m) and primarily based

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Latest Issue

BDC 319 : Aug 2024

Heathrow

Heathrow Airport Set to Submit Planning for Expansion Later This Year

Despite recent comments from the Prime minister, Heathrow Airport is ploughing ahead with its plans to expand. The company is set to submit planning for expansion later this year and they want full government backing. So, what is the planned expansion and why has Boris Johnson potential scuppered the airline’s plans? What is the planned expansion? The planned Heathrow expansion includes the addition of a third runway. The company’s plans for expansion were announced last year and sustainability was revealed to be at the heart of the new plans. According to Heathrow, the new expansion would generate 10,000 more apprenticeships by 2030, provide new routes and create up to 180,000 new jobs. However, the planned expansion caused heated debates after it was announced due to some of its proposals. These included lowering the M25 motorway, re-routing rivers and building additional car parks to house 50,000 cars. It is certainly a bold expansion which has been met with a lot of opposition. However, the benefits it would provide to the economy would be significant. Why is there doubt over its implementation? Doubt over the implementation of the new expansion has been cast after Boris Johnson gave the go ahead for the HS2 project. However, the prime minister has previously expressed his opposition to the airport’s expansion, claiming he would “lie down in front of bulldozers to stop the construction”. Now that Johnson is Prime minster, Heathrow airport need his approval if they are to continue with the proposed expansion. Given his previous stance on the matter, it is unlikely they are going to receive full government backing later this year. The benefits the expansion would provide So, what benefits would the third runway provide at Heathrow airport? Well, it wouldn’t just benefit passengers taking trips abroad. It would also benefit the air cargo sector. The airport has been running at 98% for the past decade. It is the biggest air freight airport in the UK and the expansion could further boost its air freight capacity. This would be crucial in terms of international trade, something the country now has to secure since its exit from the EU. It would boost the air cargo sector enormously, delivering a lot of great benefits to the country. As well as the air freight sector, the airport would be able to add thousands of additional flights to its schedule. It is said that this will also increase competition, allowing passengers to secure cheaper, more competitive prices. Whether the new expansion will go ahead later this year is uncertain. It does seem unlikely the government will back the plans, particularly given how much they are now spending on the HS2 project. However, that isn’t stopping Heathrow from continuing on with their application.

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Potential Sites for Heathrow Expansion Progressed to Next Stage

A total of 65 potential sites have progressed to the next stage of consideration for the new offsite construction centres at Heathrow, with the final four sites being identified next year following the completion and assessment of a pre-qualification questionnaire (PQQ). They have until the 18th of January to make their case for the project. Various sites across the UK have been visited by Heathrow representatives in order to identify the location for the future hubs, which will be used for off-site construction to make the multi-billion expansion more affordable and sustainable. “This is an exciting opportunity for us to engage with site promoters that are passionate about creating a lasting legacy. These responses will help us understand which sites will best work for the expansion programme as well as for future construction projects,” said Heathrow’s Executive Director for Expansion, Emma Gilthorpe. “When we began this search last year, we were inspired by just how many locations up and down the country were interested in playing a role in delivering the third runway. This shows the great potential there is for offsite construction to revolutionise the way major infrastructure is delivered in the UK,” she added. The expansion project will have four sites either assembling components of the expanded airport or serving as a consolidation centre for these loads before they are transported to Heathrow. Of the potential sites, 50 are existing or functioning sites, many of which are already experienced in delivering major projects, while the other 15 sites are either undeveloped or proposed facilities with the potential for additional flexibility and customisation.

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Heathrow Airport Reveals 7% Rise in Cargo Volumes

Heathrow Airport has revealed that cargo volumes have increased by 7% as it is buoyed by the expansion decision. The rise has capped a buoyant month for the transport hub after the government decided to expand the airport at the end of last month. Heathrow officials said that cargo volumes increased by 7% in October, although the total number of passengers went down slightly to 6.5 million from 6.8 million in September. This is along with a 1.2% year on year fall which it blames on last month’s Hurricane Matthew in the US. The airport accounted for 30% of all exports from the UK by value outside the EU last year, and Heathrow has seized upon the latest increase in cargo numbers to further argue that the government’s decision to green light expansion was the right one. Consultations on a draft policy statement are set to get underway next year, though it is expected to be a long and arduous road to securing the construction of a third runway at the London airport with continued opposition and legal battles set to carry on taking place. John Holland-Kaye, Heathrow Chief Executive, said that the airport had already started planning how to deliver a third runway and was keen to emphasise that the benefits of expansion would be felt right across the UK. He added: “With the support of communities across the UK, Heathrow is now working at pace to deliver the benefits of Britain’s new runway – an affordable plan that creates more jobs, boosts exporters and builds an economy that is stronger and fairer for everyone – as quickly as possible.” The third runway at Heathrow threatens to worsen air quality in central London, according to the Government’s own analysis. It also raised doubts over whether another runway could be opened in 2025 at the west London airport without breaching EU legal limits on air pollution. Transport Secretary Chris Grayling has said that meeting air quality legal requirements is a condition of planning approval.

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Heathrow CEO Hails Support for Expansion

The Chief Executive of Heathrow Airport John Holland-Kaye has hailed what he calls the ‘broad support’ that expansion at the London airport has throughout the country just as the government prepares to make a final call on the scheme. Coming at the same time as the airport announced figures that show a record number of passengers (57.3 million) passed through the airport in the first nine months of this year, Holland-Kaye seemed confident that Heathrow would win the race for a third runway. Praising Theresa May’s ‘strong leadership’, he said that the airport is ready to deliver a new runway as soon as it gets the ‘green light from the government’. Despite protestations from environmental campaigners and local residents, the pendulum seems to be swinging back into Heathrow’s favour this week with a decision by the government set to be made imminently. However, a parliamentary vote still needs to take place next year to fully give expansion the go ahead and while the likelihood of protracted battles in the courts are likely to delay work beginning even further. Despite Holland-Kaye’s confidence, there are still significant concerns about the negative impact on air quality and noise pollution as a result of a third runway and increased air traffic at the south east airport. A leaked memo penned by a former adviser to David Cameron revealed yesterday that the government could be significantly exposed once a decision has been made, arguing that it does not have an answer on the issue of air quality. Written by Camilla Cavendish a year ago in response to a draft of the then environment secretary Liz Truss’ air quality plan, it alleges that the government does not ‘have an answer on air quality’ for Heathrow expansion. Following the leak, Cavendish, who is now a peer, said: “Now this is in the public domain I have to say that I believe successive governments have failed the public on air quality. Too many people in Whitehall and parliament think they can play it down because it’s invisible.

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Savills Admits Concerns At Heathrow Despite Strong Demand

According to global real estate services provider Savills, the take-up of warehouse space around Heathrow Airport amounted to 1.14m sq ft (105,909 sq m) in 2015, a significant 17% drop from the previous 12 months. Availability across the airport presently stands at 2.07 million sq ft (192,309 sq m) and primarily based on the five-year average take-up of 1,394,832 sq ft (129,584 sq m) with last year’s decrease blamed on a tightening of good quality supply around core locations. Based on this current trend, Savills believes there’s just 1.4 years of remaining supply. However, Bonnie Minshull, Director at the South East industrial team at Savills, admits measures can improve the situation. “Although there was a drop in take-up last year, we still saw significant activity in the Heathrow market. A number of speculatively developed schemes, including Prologis Park Heathrow and SEGRO’s Stockley Close, were either let or under offer within 12 months of practical completion, which reflects the strength of demand for Grade A units in prime locations.” Indeed, occupational demand remains strong despite the lack of available space, with  487,795 sq ft (45,317 sq m) of Grade A stock coming through the site last year. That’s the highest number since 2011. In line with high demand, prime rents have additionally continued to rise. Savills predicts that rents are prone to improve further when quite a few new schemes come to the market later in 2016, with SEGRO’s last unit at The Portal quoting £17.50 per sq ft (£188 per sq m). At the moment, alongside The Portal, a number of new schemes are set to finish in 2016, which is able to bring a total of 1.02 million sq ft (94,761 sq m) to the market. Developments including Heathrow Logistics Park, Skyline,  and Prologis Park West London will all assist to alleviate the present scarcity of premium inventory over 50,000 sq ft (4,645 sq m). “Despite there being several new schemes in the pipeline, space is likely to remain constrained  for the foreseeable future,” remarks Minshull. “If freight volumes continue to grow as forecast, our research predicts that Heathrow will need up to 14m sq ft of extra warehouse space by 2030 to meet requirements. “Furthermore, to date the third runway hasn’t really featured on occupiers’  radars, however if the north-west runway, as recommended by the Davies commission, gets the green light this summer, construction is expected to commence as soon as 2019. As a result, we expect to see businesses in buildings which are likely to be compulsorily purchased start to look for alternative premises sooner rather than later, which is likely to lead to even further demand.”

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