LONDON PROPERTY PRICES: Southwark

• Despite its relatively central location, this borough has been undervalued, though this might soon change with the facelift at Surrey Quays and Canada Water and the redevelopment of Southbank.

• Fairly recent infrastructure upgrades such as the Jubilee line extension have revitalised areas such as Canada Water. Other areas, particularly in the south of the borough, such as Surrey Quays, Rotherhithe, Bermondsey and Old Kent Road, remain undervalued.

• However, with redevelopment plans for the entire borough in the pipeline, CBRE expects the area to soon realise its true value. Previous CBRE analysis shows that regeneration can boost local property prices by around 4.9% per annum, over and above general capital growth.

• The northernmost part of Southwark is a hop from the City financial district, and where the Tate Modern, now-trendy Borough Market and the Shard are located. This most valuable stretch of the Southbank river also benefits from the spillover effect of the ambitious Vauxhall, Nine Elms and Battersea megaprojects.

• There is a tower cluster currently being developed in the area. It includes prime tower schemes such the 50-storey One Blackfriars and the 42-storey Southbank Tower. Other schemes planned are 20 Blackfriars Road and Bankside Quarter. These will transform this stretch of the river bank entirely.

• At this top stretch of the Southbank, units are achieving prices of around £2,000 psf, much higher than for similar properties downriver, such as £1,500 psf in the Lambeth part of the Southbank, and nearer £1,000 psf on average on the Wandsworth river front.

• However, common to prime tower schemes is the premium they achieve, which CBRE estimates at around 36% over the local embedded value.

• Within individual schemes, there is also a per floor price premium of 2.3%, increasing to 3.5% above 20 floors.

• There 4,361 housing units currently under construction in Southwark. House-price growth was recorded at 21% for last year, and at 106% for the past decade.

• Among all Southwark residents, owner-occupiers comprise 31%. This compares with 35% for Inner London, and 48% for all of London.

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source: London living: A borough by borough showcase by CBRE

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