Mount Unpleasant: How the Royal Mail Group will make a fortune from selling flats to private investors

The proposal has dropped the amount of 'affordable' housing to a derisory level

Mount Pleasant, one of the development sites owned by the Royal Mail Group (Getty Images)

Last October, when it was floated with a £3.3bn price tag, property experts pointed out that the valuation of Royal Mail omitted the three substantial development sites it owns in London, which were themselves valued at £1 - £1.5bn.

It now appears that this may have been an understatement. In the summer, Royal Mail Group (as it is now) submitted a planning application to Islington and Camden councils for a scheme for 700 mostly private new flats at Mount Pleasant, a site which straddles both boroughs. Last week RMG asked the Mayor to remove the application from the two councils and make the decision himself. On Tuesday he complied.

His intervention outraged the two councils. The Mayor said that the need for the new homes was so urgent that he could no longer wait for Islington and Camden councils to make up their minds about the scheme. He added: “It appears unlikely that the boroughs will be in a position to determine the two applications in the near future.”

But the two have hit back, saying that they had written to Mr Johnson at least a week before he made his decision and told him Mount Pleasant was on the Camden planning agenda for 27 February and in Islington on the 10 of March. The Mayor's misleading claim is especially irksome as a recent Boris intervention, concerning a single building - the Ministry of Sound - took him TWO YEARS to decide.

James Murray, Islington Council’s executive member for housing and development, said: “There is no justifiable reason for the Mayor to call this decision in.”

His counterpart in Camden, Julian Fulbrook, said: “What is outrageous is the suggesting that we 'were not going to assess the case in the near future'. But the Mayor's staff knew the committee dates for consideration in both Boroughs were already set. Now he seems to be in the pocket of the privatised Royal Mail, who seem hell-bent on packing in as much private housing as possible.”

Another cause for outrage was that, at around the same time RMG asked Boris to take over, they reduced the amount of ‘affordable’ housing in their scheme from an already very low 20 (which both Islington and Camden found totally unacceptable) to a derisory 12 per cent. This means that of the 700-odd flats proposed, fewer than 50 may be for social renting. It also means that, based on current prices in the area, the private flats could easily fetch a total of over £4bn. And be mainly sold to foreign investors.

London Assembly member Andrew Dismore said: “This is adding insult to injury, given the huge housing shortages in London for ordinary people. The local community will also suffer years of disruption and see no benefit while RMG, having acquired the site for nothing, stand to make billions by selling expensive apartments to foreign investors.”

Is this what Boris really wants?