London is getting its first new town centre in 50 years — but at what cost?

16 streets, a town square, and a completely new high street form part of a fresh vision for Canada Water in Southeast London.

In this urban dream world, residents are treated to wineries, padel courts, and rock climbing. Close by, there are 130 acres of parks and wetlands, and what developers British Land describe as ‘luxury’ apartments, ranging from studios up to three-bedroom flats.

There’s a concierge service on hand, and roof gardens for panoramic city views. But against this shiny backdrop, the reality of this new hub – dubbed London’s first new town centre for 50 years – is complex.

When the original blueprints were developed, the affordable housing quotas promised to local residents were set at 35%.

Now that the masterplan has been approved, with responsibility for delivering it shifted from Southwark Council to City Hall, the quota has dropped to 9%.

It comes after British Land submitted an application to amend plans, together with a letter warning Mayor of London, Sadiq Khan, that any further delay would ‘significantly impact their potential to deliver the substantial benefits that the scheme provides’.

‘Developers enjoy laws that protect their profit margins’

Anny Cullum, political officer at community campaign group ACORN, tells Metro that housing developers are able to circumvent commitments on affordable housing by carrying out something called a ‘viability assessment’.

If their predictions project they won’t make a profit ranging between 15 and 20%, they’re legally permitted to reduce the number of affordable housing units to account for that shortfall.

Naturally, community unions like ACORN are concerned about what this means for the social fabric of local neighbourhoods.

‘Other businesses are used to playing by the rules and taking risks, but developers enjoy laws that protect their profit margins,’ Anny says.

‘ACORN has campaigned where housing developments have had little or no affordable housing, and this has been unacceptable to local residents, who worry about this pushing up rents in the area, and new developments not serving existing community need.’

But, as Anny says, even where ACORN has succeeded in pushing councils to deny planning permission directly because of a lack of affordable housing, developers are able to appeal the committee decision – and, very often, win. This can end up being costly for the council in question.

She says: ‘We want to see a national minimum for all developments to be designated social housing.

‘At the moment, many councils are desperate to attract developers to help them meet their local housing plans, and if developers aren’t happy with their demands around social housing, they can say that they will go and take their business to another local authority happy to negotiate on this.’

London’s cataclysmic housing crisis

Against this backdrop, London is in the midst of a generation-shaking housing crisis.

For those without the help of generational wealth to get on the ladder, it’s a lifetime membership of Generation Rent instead. In London alone, 30.1% of properties are now comprised of private rentals – the highest percentage since 1971.

Those struggling to afford private rents don’t always have the option of accessing council housing, either, as the UK’s council housing stock has slowly been depleting over the last 70 years.

In 2024, a study from Shelter found that while more than 200,000 social rent homes were built in England in the mid-1950s, by 2023 to 2024, the number of homes built had declined to just 10,000.

Plus, statistics from the New Economics Foundation (NEF) found that more than four in 10 council homes sold under the controversial Right To Buy policy are now owned by private landlords. Together, all of these underlying factors prove why affordable housing is so essential.

But still, it’s being compromised.

Better than nothing?

In a city as expensive as London, you’d be forgiven for assuming that affordable housing requirements are fixed rules. But as Benham and Reeves’ director, Marc von Grundherr, explains, this actually isn’t the case.

He says the benchmark is generally 35% for affordable housing, and 50% on public land. Despite this, he believes the decision to allow the Canada Water plans to proceed is ‘understandable.’

He tells Metro: ‘London urgently needs more homes and major regeneration projects of this scale are incredibly difficult and expensive to bring forward.

‘The concern is that if large developers are repeatedly allowed to renegotiate affordable housing commitments after securing consent, it risks undermining confidence in the planning system and raises questions about who these developments are really being built for.

‘At the same time, had the scheme been refused or delayed further, the local community could have been left with no new homes, no new infrastructure and no new town centre at all.’

Even Southwark Council is somewhat disappointed. Councillor Helen Dennis, cabinet member for new homes and sustainable development, described affordable housing as a ‘priority’ for the borough, and likened the vision behind the Canada Water masterplan to that of a ‘New Town,’ with new jobs, facilities, and importantly, 3,000 new homes.

Following last week’s decision, she said: ‘The affordable housing proposed in the next phase of Canada Water is a huge disappointment given the affordable housing numbers that this scheme was designed to deliver.

‘We intend to maximise the review mechanisms available to us to increase the social rented homes delivered, should viability improve, so that we can deliver the homes that our community deserve.’

Marc adds that in Canada Water specifically, local housing need is acute (there are more than 22,000 households on the housing waiting list across the entire borough of Southwark). In his opinion, compromising on affordable housing stock runs the risk of pricing existing locals out.

He concludes: ‘There’s a risk that developments of this kind accelerate displacement, deepen inequality and create places that feel designed primarily for wealthier incoming buyers.’

Gareth Roberts, Head of Canada Water, British Land, told Metro: ‘Approval of our revised masterplan is vital to accelerating momentum, creating a global destination as part of an amazing new neighbourhood that is uniquely Canada Water.

‘The viability challenges we have faced are being felt across London, but with the first phase of development having recently completed, this decision will enable us to bring forward future homes, employment opportunities and investment in local infrastructure.’

Metro has contacted the Greater London Authority for comment.

Do you have a story to share?

Get in touch by emailing [email protected].

MORE: Families ‘barricaded’ inside shops after gangs of teenagers swarm Clapham high street

MORE: New first-class lounge at the UK’s ‘best train station’ serves free food and drink

MORE: The ‘quaint’ city named the UK’s top commuter location in 2026