Developer says work on the consented schemes could start in 2027
Landsec has paused several large residential schemes, saying the returns are not enough currently to justify capital expenditure.
The developer, in a trading update today for the six months to 30 September, said returns from residential and office development are currently less attractive than retail, so it “does not plan to commit any meaningful balance sheet capital to new development in the next 12-18 months”.
This includes pausing four consented residential projects that could together deliver 9,000 homes.
They include the first phase of 879 homes for a scheme at Mayfield, Manchester, for which Landsec has detailed planning consent, and a 2,800-home scheme in Lewisham, south-east London, for which it has part-outline and part-detailed planning.
Other consented schemes paused include a 1,800-home scheme at Finchley Road, north London, and 2,700 homes at Media City, in Salford.
Landsec said: “We could see first starts on site in 2027, taking into account detailed design works, Building Safety Act approvals, and site preparation. However, returns currently are not at sufficient levels which is an issue across the wider market.”
It said a series of government measures, including a reduction in affordable housing requirements and the Community Infrastructure Levy as well as relaxed design requirements, “could lead to an improved outlook for residential development returns in 12-18 months but in the meantime capex spend will be very limited”.
The developer cited figures from Molior showing new housing starts in London fell to 3,248 over the first nine months of 2025, down 75% over the last three years.
The announcement from Landsec is likely to cause further concern about the viability of building housing in London.
The Home Builders Federation in September warned that housing delivery London is in “major crisis” with figures for starts, permissions and energy performance certificate issuances all showing a downturn.
The government last month announced an emergency package of planning measures to help boost delivery in London, including a lowering of affordable housing and design requirements.
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