Canary Wharf has survived and thrived for 30 years and now faces new challenges

by Jack Brown

This year saw the 30th birthday of the Canary Wharf development. Its iconic towers, now the backdrop for endless news items on finance, business and the economy, have become a familiar London landmark, almost as recognisable as Tower Bridge or St Paul’s Cathedral. Yet compared to the centuries-old City of London, its sibling up the road, the Wharf is barely a toddler.

There have been several points in the young business district’s short life when it seemed unlikely that it would last even this long. What is more, though its success may seem assured today, the future is likely to bring new challenges. Now seems an appropriate moment to reflect on its past and to consider what could come next.

In 1980, Canary Wharf sat desolate and still. The docks that surrounded it, once the engine room of Britain’s global trade and prosperity, had fallen silent. Changes in shipping technology had rendered them redundant, with thousands of jobs vanishing, and hundreds of thousands of people leaving the surrounding boroughs. Docklands was caught in a seemingly irreversible spiral of economic and demographic decline.

The regeneration of the area was orchestrated by the London Docklands Development Corporation (LDDC), established in 1981 by Michael Heseltine, the Conservative government’s environment secretary. Heseltine was appalled by the dereliction he saw in the run down dockside areas of East London (and Liverpool’s Merseyside), but also by the piecemeal development of London’s South Bank during the 1970s, which he felt an “appalling architectural desert” of uncoordinated and ugly buildings. He decided that the government should take additional powers in order to stimulate development and also, crucially, to control it. He therefore took a highly un-Thatcherite, interventionist approach to orchestrating the Docklands’ regeneration.

The LDDC was set up in 1981, with a wide-ranging remit that focused on acquiring land, building infrastructure and marketing Docklands to the wider world. Its highly entrepreneurial chief executive Reg Ward repeatedly stretched the boundaries of the LDDC’s reach in trying to achieve great things for the area. He envisaged a new Water City for Docklands and later Eastminster, a centre of power in the East End to rival Westminster and shift London’s growth momentum eastwards.

Early developments were relatively modest. But then a chance encounter with the banker Michael Von Clemm saw Ward’s Eastminster dream seem suddenly possible. Von Clemm, who had originally been in Docklands looking for a food processing plant on behalf of the restaurateur Roux brothers, realised that the vast open spaces provided by the derelict docks could provide the sort of floor plans needed for a new trading floor for his firm, Credit Suisse. In early 1985 he brought in the American developer G Ware Travelstead to take the idea forward.

Ward and Travelstead were kindred spirits and worked closely – some said too closely – to develop their radical plans for an entire new financial district. While they forced the project through to the point of near completion – with land acquired, a new upgraded light railway, and extensive plans for the development ready to go – it took another developer to actually deliver Canary Wharf. Canadian property giants Olympia & York (O&Y), run by the elusive Reichmann family, took over the project in 1987, when Travelstead proved unable to finance construction.

Paul Reichmann, who took the lead on the property development side for O&Y, was particularly taken with Margaret Thatcher and her vision for Britain. He decided to take a gamble on Canary Wharf, despite its relatively poor transport links to London’s historically dominant financial centre in the Square Mile, and signed up on 17th July 1987. Yet Reichmann’s optimism was to prove short lived. A transatlantic property crash, the delayed delivery of transport infrastructure, and the reluctance of firms to leave the historic City of London all combined in a perfect storm, and Olympia & York collapsed into administration in 1992, with Canary Wharf half built.

For what today seems such an established London landmark, it is often forgotten that Canary Wharf was derided as a white elephant in the early 1990s. For some time, it was unclear if it would even be finished. Yet the development’s recovery was swift and it soon rose phoenix-like from the ashes of administration. Reichmann bought back in, as part of a consortium, in 1999, and held a controlling stake until 2004.

Canary Wharf came through the financial crisis of 2008 relatively unscathed in terms of jobs. It is a symbol of resilience in itself, in transitioning over just three decades from the centre of seaborne trade with the British Empire to a centre of global finance. Modern Canary Wharf has already survived the total bankruptcy of its initial developers and Canary Wharf Group (CWG), the heir to O&Y’s throne, is now building housing and attempting to diversify its tenants, particularly into the technology, media and telecoms sectors.

Around 5,000 civil servants are on their way to the estate, as part of central government’s plan for hubs outside of Whitehall, echoing Reg Ward’s 1980s Eastminster dream. Massive expansion is planned, most notably at the adjacent Wood Wharf site. Other CWG developments such as the Walkie Talkie building in the City of London and the Shell Centre on the South Bank, demonstrate that its influence now extends across the capital.

Today’s Canary Wharf employs as many people as the docks that preceded it, but its future is far from secured. Brexit and automation both bring great uncertainty to jobs and business across London and the UK, and Canary Wharf, being primarily an international centre of finance, is particularly at risk. The recent departure of the European Medicines Agency and the European Banking Authority, to Amsterdam and Paris respectively, serves as a reminder of this threat. Canary Wharf has proven adept at accommodating change. But if there is one lesson to be taken from its three decades of such experience, it is that the process is not always a smooth one.

Jack Brown works for the Strand Group at King’s College and is researcher in residence at 10 Downing Street. He has a particular interest in the contemporary history of Docklands as well as in London in general. Previous articles by Jack for On London are here and here.

 

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