City Hall has been based in the Norman Foster building since 2002
The Greater London Authority (GLA) spends £11.1 million a year to rent the Norman Foster-designed building on the south bank of the Thames near Tower Bridge.
However, the private landlord, Kuwaiti-owned St Martin’s, is set to raise the cost of rent to £12.6 million per year from Christmas 2021.
Sadiq Khan believes this is above the market rent and is considering moving City Hall to The Crystal, a building the GLA already owns in the Royal Docks.
The move would save the GLA £55 million over five years, which would reportedly be spent on protecting front-line services from cuts and invested in initiatives to help London’s economic recovery from Covid-19.
The Crystal also has an “outstanding” rating for environmental sustainability which means running costs would be lower than the current building.
Last week, the Mayor raised concerns the GLA Group would suffer an unprecedented financial emergency due to the coronavirus crisis without Government support.
They are currently facing a budget shortfall of nearly £500 million over the next two years.
“My first priority will always be to protect funding for front-line services, including public transport, the Met Police and the London Fire Brigade,” said Mr Khan. “That’s why I’m consulting on plans for the GLA to leave the current City Hall building next year and relocate to The Crystal at the Royal Docks in Newham.
“In normal times, it would be standard practice for any Mayor to consider utilising the lease ‘break’ clause on the City Hall building that becomes possible this year, and to view it as an opportunity to ensure Londoners were getting the best value for money. In the current financial context, and with the looming black hole in London’s public finances, it would be negligent not to do so.”
A formal consultation on the proposals will now run for six weeks.
The Mayor of Newham, Rokhsana Fiaz, said: “I’m delighted that City Hall could be relocating to the iconic Crystal Building in the Royal Docks in Newham. The stunning Royal Docks, with a water area of nearly 250 acres, is at the heart of one of the most exciting renovation developments in the capital, bringing more jobs, housing, and a thriving new business district to east London.
“It’s a great opportunity to have London government in our borough and I’m looking forward to welcoming the mayor, assembly members and the City Hall team to this magnificent location which is a neighbourhood rich in history, thriving with ambition; and with a long-standing diverse community who will welcome them warmly.”
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