Residents and schools priced out of Westminster by ‘dirty money’

By Hannah Neary, Local Democracy Reporter

Schools and small businesses are struggling to survive in one of London’s most expensive postcodes as residents are being priced out by mansion owners with “dirty money” a West End councillor said.

The number of empty and second homes in Mayfair is leaving the area half-empty as Londoners can’t afford to live there, Labour councillor Jessica Toale stated. 

She explained the swanky area in the heart of Westminster is losing its “vitality” as independent businesses and young families are leaving due to sharp rent increases.

She added this is caused, in part, by the super-rich buying property through illicit means.

Cllr Toale said: “If you walk around at night you see hardly any lights on. It’s a stark indication of how many empty properties there are, particularly Park Lane, which has been a residential hub in the area.

“Schools are struggling to get enough pupils, the library footfall is down. Commercial rents are going up, which means it’s difficult for the companies to pay rent.”

Westminster has seen a 1,200 per cent rise in the number of property owners registered to Russia and a 300 per cent rise in owners registered in Jersey since 2010, according to the Centre for Public Data.

Westminster City council has launched a new campaign against dirty money in the borough, pledging to make sure businesses pay their fair share of tax and stop foreign property owners from using local properties as a hub for illicit business.

The council is already investigating 30 American-themed stores in the West End for alleged business rates evasion of £7.9 million.

Cllr Toale said: “There’s nothing wrong with buying property to invest in and having second homes but there’s clearly property that has been bought with illicit money. 

“Lots of them are in Mayfair, Westminster and Kensington and Chelsea. What the council has been talking about doing is looking at ways to potentially compulsory purchase these properties in extreme cases. 

“I don’t want the council to lose focus on this. The amount of empty properties just means that it’s putting prices up all over but making it more difficult to live in the area.”

Cllr Toale said one school in her ward has had to combine year groups as it’s struggling to fill places due to the lack of young families living in the area.

She added: “Mayfair has lost its corner shop and in its place, there are these high-end shops. There are people who have lived there 30 or 40 years who don’t feel the same. 

“There has been obvious population decline over the past ten to twenty years. There’s nowhere to go shopping or get a pint of milk. It sucks the vitality out of the area.”

Pictured top: Westminster City council offices in Victoria (Picture: Hannah Neary)