Plans for the regeneration of the Elephant & Castle took a significant step forward on Wednesday night when Southwark Council's cabinet voted to sign a deal with Australian developer Lend Lease.
Wednesday's decision brings to a conclusion a three-year process that began when Southwark Council, then run by Liberal Democrats and Conservatives, selected Lend Lease as its preferred partner in July 2007.
At that point a deal was expected to be agreed between council and developer by the end of 2007, but a series of setbacks saw the date pushed back repeatedly.
Southwark Council passed into Labour control eight weeks ago and the new regime claims that it has secured additional commitments on affordable housing, the future of the Elephant & Castle Shopping Centre and leisure provision for local residents.
"This could well be the most momentous decision we as a cabinet take in this four-year period," said council leader Cllr Peter John as he invited his nine fellow cabinet members to endorse the deal.
The deal is centred around the sale by the council of the land currently occupied by the Heygate Estate to Lend Lease on a series of 999-year leases.
"The opportunity to transform the area over the next fifteen years to provide a new focal point for London is a responsibility we take extremely seriously," says Lend Lease CEO Dan Labbad.
The Heygate Estate will be demolished over the next five years whilst a masterplan for the site is created and approved.
The draft master regeneration plan talks of the new Elephant as a series of "urban villages", with shops and restaurants at ground level and residential developments of varying heights above.
Previous plans for a tight cluster of tall buildings have been abandoned because of the need to respect the protected view from the Serpentine Bridge in Hyde Park. The draft plan talks instead of a "site-wide distribution of tall buildings".
The future of the Elephant & Castle Shopping Centre is still uncertain. Whilst the redevelopment of the land it occupies will be included in Lend Lease's outline planning application, it is still firmly outside the company's control.
Southwark Council hopes to bring the centre's owner, St Modwen, into a joint venture with Lend Lease but if that cannot be achieved then Lend Lease will underwrite a compulsory purchase order.
Negotiations with Transport for London over the costs of rebuilding the Northern line station at Elephant & Castle with escalators instead of lifts, and the remodelling of the northern roundabout, have previously been cited as an obstacle to a final regeneration deal. It seems that a conclusion has still not been reached.
"We're still talking to the Mayor and TfL," says Cllr John. "Two weeks ago I had a really productive meeting with Boris Johnson. The question of the revamped Elephant & Castle station was referred to and the Mayor and TfL will no doubt pore all over this regeneration agreement as soon as they can to see the figures for themselves."
Cabinet member for regeneration Cllr Fiona Colley stressed the need to follow up the deal with action: "People at the Elephant & Castle don't just want to see a signed piece of paper; they want to see change," she said.
Cllr John told us: "We're not necessarily going to see any buildings coming out of the ground in the next 12 months but I hope before 2014 we'll really begin to see the rebirth of the Elephant."
Southwark's opposition Liberal Democrat group has been quick to highlight perceived shortcomings in the new deal.
"It is extremely bad news for the taxpayer as Labour have lost tens of millions of pounds – as a result of their incompetent renegotiation," says group leader Cllr Anood Al-Samerai.
"In their mad rush to sign any deal they have squandered more than a third of the total capital receipts the council should have received.
"But tenants are the big losers. At the election Labour called for the building of 'thousands of new affordable homes', but their minimum requirement of 25 per cent for affordable housing will see less than 800 built on the Heygate site.
"It shatters the council's planning requirements of 35 per cent affordable housing in the area and will deliver fewer affordable homes than would have been secured by using these planning rules effectively."
The Lib Dems have also questioned Labour's commitment to the proposed multi-utility services company (MUSCo) but Cllr John insists that there is no change to the council's policy on the environmental credentials of the Elephant scheme.
"This is a truly momentous decision that we've taken this evening," says Cllr John.
"This means pulling regeneration down from the north of the borough into the centre of the borough. I think it's also important in terms of pulling the centre of London southwards.
"This has unrivalled opportunities and prospects for the future employment and living conditions of so many people in Southwark. It's a very exciting decision."