Experts from our Heathrow office have hailed the announcement of the approval of the third runway at Heathrow, which has been dubbed an ‘historic moment’ by Transport Secretary, Chris Grayling.
The announcement, which came as Cabinet approved the new runway plan on 5th June, will see 15% of new landing slots at the airport as part of the £14 billion project, and is expected to complete by 2026.
Speaking of the announcement, Matt Clarke, Partner in our Heathrow office, said: “This is a welcome decision which will further promote Heathrow, West London, Surrey and the Thames Valley as a world class location to do business in.
“Not only this, the addition of an extra runway, whilst contentious, will reap a great deal of benefit both for the business community and wider local economy, as well as many other parts of the UK which will be connected to the new and expanded Heathrow Airport.”
It is expected that the runway will increase passenger capacity from 85.5 million to 130 million, whilst generating approximately 60,000 new jobs and adding around £70 billion in economic benefits to the UK by 2050.
“Improvements to road and rail infrastructure in the surrounding area will help to significantly reduce journey times to the airport both for the benefit of business and the wider community. From a property perspective, it will present some businesses with the need to relocate as a direct result, proving a chance to review their future property strategy,” continued Matt.
The announcement also creates a number of opportunities for businesses approaching lease expiry or with lease renewal or break clauses.
“Many Freeholders will want to consider their land holdings – do they need to own property or would a sale and leaseback be more worthwhile for them now? With the advent of infrastructure changes such as better rail access and the effect of a third runway, would their business be better located elsewhere, and if so, where?
“Could their business operate efficiently and cost effectively from other nearby locations at likely lower occupational costs, but within striking distance of Heathrow? These are all questions that those businesses operating in the environs of Heathrow should now be asking themselves.
“This is both an interesting and exciting time for businesses in the Heathrow and surrounding areas, but when considering future property needs, it’s important to seek professional advice to secure the best possible outcome.”
The new runway is expected to become operational between 2025 and 2030.
For help and advice in relation to the impact of Heathrow on your property requirements, don’t hesitate to get in touch with our expert advisers.