The Week That Was – 17 May 2024

Welcome to the week that was, a round-up of key events in the construction sector over the last seven days.

London set to be the most crowded skyline in Europe

According to a new report by New London Architecture ("NLA"), 583 tall buildings above 20 storeys are planned for the capital (which is more than twice the number that have been built in the last 10 years).

The report, which is the 10th annual tall buildings report by NLA, puts these plans down to "burgeoning demand for office and residential space, overseas investment and a supportive planning environment”.  NLA's co-founder Peter Murray, says: “the pipeline that NLA has tracked means there is at least 10 years’ supply that has already been defined".

The authors of the report believe that demand has increased for greener, grade A office space in the City, and that there is a growing trend for high-rise student accommodation (particularly given the current state of the residential property market due to higher interest rates and construction costs).

The full report can be found here.

Council's breach of duty in Japanese knotweed control did not cause diminution in value loss in nuisance – Davies v Bridgend County Borough Council [2024] UKSC 15 (8 May 2024)

The Supreme Court has unanimously overturned the Court of Appeal's decision concerning Japanese knotweed encroachment from adjoining land.  In short, diminution in value which has already occurred prior to the defendant's breach will not form part of any award.

The landowner claimed damages in nuisance for the residual diminution in value to their property caused by the presence of Japanese knotweed encroaching from the neighbouring land owned by the local authority.  The Court found that the fact that the encroachment had existed when the landowner bought the property, at a time before an actionable tort in private nuisance arose, meant that the neighbour's failure to treat the knotweed had not in fact materially contributed to the diminution in value.  The application of the "but for" test eliminated the neighbour's subsequent breach of duty as a causative factor.  The fact that the diminution in value would have occurred in any event meant that there was no causal link between the breach of duty and the diminution in value claimed.

Landowners will be relieved by the Supreme Court's robust stance on causation.  However, there remains potential liability in nuisance where they have not treated the knotweed and it spreads to neighbouring land.

The full judgment can be found here. 

Over 250,000 extra construction workers required by 2028 to meet demand

The Construction Industry Training Board ("CITB") has published their latest annual industry forecast, detailing the demand and workforce requirements needed to keep up with the demands of the industry.  With a third consecutive year of growth, the UK's construction output rose by 2% in 2023 and is expected to grow by an average 2.4% a year between now and 2028.  CITB has forecast that an extra 250,000 construction workers are needed by 2028 to meet the demands of the growth, with construction employment set to rise to 2.75m by 2028.  CITB have invested £267m into the sector, responding to the challenge of improving diversity, quality, productivity, and career prospects in the industry.

You can read more here. 

Number of business failures hits two-year low

As the overall economy showed signs of recovery last month, administrations within the construction industry dipped to a two-year low in April.  Gareth Harris, Partner at RSM Restructuring Advisory, said that the construction industry is one of the "largest contributors" to the overall number of insolvencies, with the two-year dip in the industry reflecting the lower insolvency numbers throughout the wider economy.  Commenting on the close tie between insolvency numbers, interest rates and inflation, he admitted no surprise in "the fewer business failures as inflation recovers from recent highs".  Only 13 firms fell into administration last month, which is the lowest level since May 2022.  We are hopeful this presents an optimistic outlook to the industry. 

You can read more here. 

PLP's Savile Row rebuild plans set for refusal

Westminster Council's Planning Committee is likely to reject PLP's plans for proposed works at 27 Savile Row, at a meeting next week, despite strong local support for the scheme.  This follows planning officers recommending the works for refusal on heritage grounds.  The proposed works involved the demolition of the former West Central Police Station Building and the rebuild of a replacement eight-storey office. 

In a 59-page report, officers have said that the proposed replacement building "failed to preserve or enhance" the surrounding Regent Street conservation area.  Heritage advisors had called for the reuse of the former police station building, highlighting Westminster Council's plan to turn the Borough into a "retrofit-first" area, which had last month led to the demise of another demolish and rebuild scheme at 18-19 Savile Row.  However, in a move away from their previous decision, officers have recommended that the site is suitable for demolition on economic and sustainability grounds. 

You can read more here.

Government wins landmark safety remediation case

The Department for Levelling Up, Housing and Communities has won a landmark legal challenge against a freeholder, Grey GR, that was delaying fixing building safety defects at Vista Tower.  Legal action was first commenced against Grey GR, in October 2022, following "unacceptable delays" in fixing multiple serious fire safety issues in Vista Tower, which had first been identified in 2019.  The Vista Tower case was the first action brought by the Government under powers introduced in the Building Safety Act 2022

Following the trial in March, the Court will issue a remediation order, imposing a legally binding requirement on Grey GR to fix the safety issues within a mandated timeframe.  The Government is also now seeking remediation orders on five other Grey GR buildings that have or will be going to trial over the next year.  They include The Chocolate Box in Bournemouth where, as a result of the Government's legal action, Grey GR has now started remediation works.

You can read more here. 

Authors for this week's edition: Chris Brewin, Lucy Cadwallader, Chloe Carter and Emily Twomey

Disclaimer: The information in this publication is for guidance purposes only and does not constitute legal advice.  We attempt to ensure that the content is current as at the date of publication, but we do not guarantee that it remains up to date.  You should seek legal or other professional advice before acting or relying on any of the content.