Royal Mail has completed the first phase in the £32 million redevelopment of its flagship MountPleasant central London mail centre, and confirmed that it is looking to sell off around half the
land around the facility to property developers.UK media reports suggested that the land sale could raise up to £1 billion, although a RoyalMail spokeswoman dismissed such figures as speculation and told CEP-Research that the changes wereprimarily driven by operational priorities rather than a land disposal strategy.
With Royal Mail committed to modernising its entire network, she said there would be othersites around the UK where consolidation of operations would take place, but there would also be aneed for investment and the purchase of new equipment and facilities, and there were no facilitiesoutside of London that had the kind of land-sale value that Mount Pleasant offered.
She insisted that the possible sale of parts of the Mount Pleasant site that are no longerneeded for operations were also not directly linked the planned sale of Royal Mail. She toldCEP-Research: “There were plans to privatise Royal Mail four to five years ago that did not come toanything. Admittedly, we are closer to it now, but we are not there yet. The political element canchange, but we have to make sure that we have the right operational network and world-classfacilities to serve our customers.”
She said the priority was to adjust to the changes taking place in the postal markets,particularly the 5 per cent annual decline in traditional mail volumes and the increase in parceltraffic. “We need to respond to that, and so this is very much an operationally led strategy,” sheinsisted.
The full refurbishment of the ground floor of Mount Pleasant has now been completed,including the installation of four new intelligent letter-sorting machines, four refurbishedmachines for cancelling the stamps on mail, and six ‘walk sorting machines’, which sort mailaccording to a postman or woman’s delivery route.
Royal Mail added: “This 18-month project, involving internal and external contractors andaffecting every aspect of the operation, has been completed as the company continues to sort anddespatch more than one million items of mail a day across the capital.”
The company said the next phase of the building’s refurbishment was now underway, includingthe transformation of the first and second floors. These will house the delivery operations forLondon’s West End and West Central areas when they transfer from the Rathbone Place site during2013. This building will close and was already sold for £120 million in 2011.
Ian Songhurst, Royal Mail’s Regional Operations Director for London, said: “Mount Pleasant’stransformation reflects the massive change being undertaken across the whole company. This is keyif we are to place the company on a sound, secure and stable footing so that we can provide a trulyworld class postal service that is fit for the 21st century.”
Royal Mail said Islington and Camden Councils had already held public consultations onfuture development proposals for the parts of the Mount Pleasant site that are no longer needed forRoyal Mail operations. This includes vehicle-parking areas on the northern and western parts of thesite, with vehicle parking needs expected to be fulfilled in the future within the Royal Mailbasement area once the full refurbishment of the building has been completed, CEP-Research haslearned.
Both Councils have indicated support for a development that could see parts of the site usedfor new housing, including affordable family housing as well as new and improved streets to betterconnect the surrounding neighbourhoods. The Councils have now jointly agreed a planning brief forthese areas and this is now being progressed towards a planning application.
The spokeswoman told CEP-Research that the disposal of the land was a long-term project thatwould not move forward until the modernisation of the rest of the site had been completed andbedded down, with Royal Mail looking at applying for planning permissions for the land in around 18months or two years, potentially resulting in land sales in three to four years.
