Little Copenhagen

A new “Little Venice” of up to 1,000 waterside apartments is taking shape alongside two purpose-built canals and a dock on the edge of Chelsea in south-west London. Detailed plans for the first of 12 blocks have been released by the developer, St George, which is targeting affluent property investors in Asia, the Middle East and Russia. Several sales were made off-plan in March, and the first apartments should be ready for occupation by the end of the year.

Chelsea Creek will be the first residential development in London to incorporate navigable canals, according to its architect Michael Squire. The original Little Venice in Maida Vale, north London, was built in the 19th century around the Regent’s and Grand Union transport canals, while more recent canals dug in Docklands, to the east of the City of London, are little more than water features unconnected to the river.

The most expensive apartment in the first phase at Chelsea Creek – a four-bedroom penthouse of 3,300 sq ft with its own spa and sauna and 2,000 sq ft of roof terrace – is for sale at £5m. The on-site marketing team have reported an early reservation on a three-bedroom penthouse at about £3.5m, and there are three further sub-penthouses costing £1.3m-£1.4m. At the other end of the scale, prices begin at £186,000 for a limited number of one-bedroom studio apartments aimed at young professionals living or working in the London borough of Hammersmith and Fulham, under a part-ownership discount scheme for first-time buyers drawn up between St George and the local authority.

St George is part of the Berkeley group, which specialises in redeveloping urban brownfield sites. Until the 1960s, much of the land alongside the Thames was used for services and industry rather than housing – “the tradesman’s entrance to London”, as Squire puts it. Chelsea Creek occupies a 38-acre site behind Chelsea Harbour, the development that pioneered the transformation of former light-industrial riverbank into residential accommodation on this stretch of the Thames in the 1980s. Conceived as an extension of neighbouring Imperial Wharf, the bigger St George development on the Thames completed last year, Chelsea Creek was given its own identity – and waterfront – in a move that sidesteps the danger of it becoming the poor relation, marooned in a less-than-prime site.

The “creek” itself is a largely subterranean stream known as Counter’s Creek that flows into the Thames from Kensal Green cemetery to the north; in recent years, it has been a derelict swamp. The new canals and dock will be linked to the tidal Thames via rebuilt locks and tunnel. The locks will also ensure that the dock maintains a minimum level of water, rather than revealing mudflats at low tide.

The tunnel to the river limits the size of the boats that can be docked at Chelsea Creek but Nick Hutchings, managing director of St George, Central London, sees this as an advantage. “It means there won’t be any Sunseekers [large yachts],” he says. Instead, the dock will be ideal for small craft such as canoes – a publicity image shows a kayak tied to steps leading to the water directly from an apartment window. Inspiration for the scheme came not from Venice or even Amsterdam so much as from the Sluseholmen canal district in Copenhagen, a once heavily industrialised port zone transformed for residential living between 2004 and 2008.

Chelsea Creek faces several competitors in the marketplace for high-value residential waterside property, including from St George’s own Battersea Reach development directly opposite on the cheaper south bank of the Thames. On the other side of Chelsea Harbour, the old Lots Road power station is being redeveloped, while further afield, both up- and down-river, several developments are on the verge of construction, including at Vauxhall and at Hammersmith.

Hutchings is sure there is sufficient appetite for London riverside property to avoid oversupply. “Clearly there’s a shortage of good housing product on the market,” he says, adding that the mortgage market may be moribund, but that would change. Meanwhile, demand remains high from overseas cash purchasers, buying for themselves or for children studying in London, as well as for the rental market. For these buyers, fluctuations in the value of the pound are an important factor. “People still see London as a place to buy and to invest – they see that we have a stable system of government here,” Hutchings says.

St George launched Chelsea Creek in Hong Kong, Singapore and Kuala Lumpur last month. Potential buyers from other important overseas markets, Russia and the Middle East, tend to come to London to buy directly.

St George was unwilling to put a figure on its total investment in constructing the new Chelsea Creek waterways. But research carried out by estate agent Hamptons International found that waterside property in London is worth about 18 per cent more than the equivalent property away from water. Rental income in London was 13 per cent higher for waterfront properties, rising to 16 per cent for larger, three-bedroom properties.

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Buying guide

Pros

● Water brings space and tranquility.

● Residents will be able to use the floating marina at Imperial Wharf for bigger boats.

● Improved transport links following the opening of Imperial Wharf station in 2009.

Cons

● Trains are infrequent, do not connect directly with central London or airports, and there is still no fast, frequent waterbus.

● This stretch of the Thames bank will be blighted by building for the next 10 years.

● Chelsea Creek is not actually in Chelsea.

What you can buy for

● £100,000 Five parking spaces at Chelsea Creek.

● £1m A three-bedroom, two-bathroom apartment of 1,007 sq ft.

Contacts

Knight Frank Chelsea Creek tel: +44 (0)20 7610 9693