Cash-strapped London mayor’s City Hall move could save £55m

Sadiq Khan plans move to East London's Royal Docks area as rent at current Kuwaiti-owned riverside building is too high

Mayor of London Sadiq Khan said the money would be invested in front-line services such as public transport. Reuters  

The home of London’s government could move next year from central London to the British capital’s East End in an effort to save £55 million (Dh253m) over five years.

London Mayor Sadiq Khan said the unprecedented financial crisis caused by the coronavirus pandemic meant savings needed to be made and singled out the rent on the Kuwaiti-owned building as too high. He plans to reinvest the money in front-line services including the police, the fire brigade and public transport, which are facing budget cuts.

The Greater London Authority, the official name for the regional government in the city, is facing a budget shortfall of up to £493m (Dh2266.3m) – a figure expected to rise in the coming years.

The lease on the government building, known as City Hall, was granted in 2001 for 25 years but has a break clause in the contract in December 2021. Notice must be given by September this year.

Mr Khan will now carry out six weeks of consultations with various groups over the move to the Royal Docks.

“In the current financial context, and with the looming black hole in London’s public finances, it would be negligent not to do so,” he said.

“Leaving our current home would save £55m (Dh252.8m) over five years, which would help us to protect and invest in the things that matter most to Londoners, as well as supporting the regeneration of the Royal Docks.

City Hall currently costs the London government £11.1m (Dh51.1m) a year in rent to its Kuwaiti owners.

The mayor of Newham, where the new government building would be, said the area “is a neighbourhood, rich in history, thriving with ambition; and with a long-standing diverse community who will welcome them warmly”.

East London, historically a poorer, working-class district, is undergoing significant regeneration and gentrification.