Status: Planning Pipeline Signal – Record Application & Approval Volumes
Authority: City of London Corporation (Planning & Transportation)
Applicability: City of London developers, contractors, designers, investors, commercial occupiers
Period Covered: Calendar Year 2025 with delivery implications for 2026+
Authority: City of London Corporation (Planning & Transportation)
Applicability: City of London developers, contractors, designers, investors, commercial occupiers
Period Covered: Calendar Year 2025 with delivery implications for 2026+
The City of London Corporation has confirmed that 2025 was a record-breaking year for planning applications, the highest annual volume seen in over a decade. According to the Corporation’s latest release, applications for major commercial schemes surged, with planning permissions granted for over half a million square metres of office floorspace, equivalent to more than seven Gherkin-sized buildings.
On the surface, this appears to confirm what many in the market have sensed for months: demand for premium, Grade A office space in the Square Mile has not slowed. However, for contractors, designers and delivery teams, the more important question is not how much has been approved, but what this pipeline means once it reaches site under 2026 regulatory conditions.
On the surface, this appears to confirm what many in the market have sensed for months: demand for premium, Grade A office space in the Square Mile has not slowed. However, for contractors, designers and delivery teams, the more important question is not how much has been approved, but what this pipeline means once it reaches site under 2026 regulatory conditions.
A Planning Surge, Not a Delivery Guarantee
The City has received the highest number of planning applications in 10 years, with major schemes (over 100,000m²) up 36% year-on-year. Decisions issued in 2025 also reached a decade high, signalling a highly active planning authority pushing schemes through the system.
Yet planning momentum does not equate to friction-free construction. A significant proportion of the newly approved floorspace is either already under construction, or scheduled to start in early 2026, precisely as Building Safety, competence and evidence requirements tighten further.
This mirrors a broader London trend already identified in LCM’s market outlook, where paper confidence is running ahead of delivery capacity.
The City has received the highest number of planning applications in 10 years, with major schemes (over 100,000m²) up 36% year-on-year. Decisions issued in 2025 also reached a decade high, signalling a highly active planning authority pushing schemes through the system.
Yet planning momentum does not equate to friction-free construction. A significant proportion of the newly approved floorspace is either already under construction, or scheduled to start in early 2026, precisely as Building Safety, competence and evidence requirements tighten further.
This mirrors a broader London trend already identified in LCM’s market outlook, where paper confidence is running ahead of delivery capacity.
Landmark Tall Tower Approvals
One of the strongest signals behind the planning surge is the approval of iconic high-rise schemes that will reshape the City skyline and stress delivery capacity.
The City Corporation has already approved plans for what will become the Square Mile’s tallest tower, a 74-storey office building at 1 Undershaft, slated to add over 154,000m² of Grade A office space to the delivery pipeline. This scheme will not only anchor the City cluster’s future skyline but also embed complex mixed-use requirements (public spaces, elevated gardens and cultural activation levels), which increase coordination overhead on delivery teams.
Similarly, in mid-2025 the Corporation resolved to grant planning permission for at least two further City towers, including a 45-storey scheme at 63 St Mary’s Axe and a 32-storey development at 85 Gracechurch Street, collectively adding significant commercial floorspace to the pipeline.
These are not simple box builds, they are strategic, mixed-use megastructures. From a construction delivery perspective, aspirations such as multi-level public realm, education spaces and integrated infrastructure interfaces directly correlate with higher pre-construction cost, longer lead-ins and elevated evidence requirements.
Why Grade A Towers Are Driving the Signal
City of London vacancy rates currently sit at around 7.4%, but this headline number masks a critical split. For Grade A towers, vacancy tightens dramatically to circa 2%, with flagship assets such as 22 Bishopsgate now fully occupied.
This imbalance explains why developers are continuing to push high-spec commercial towers forward despite:
The planning data confirms that the Square Mile is doubling down on quality, not volume.
However, Grade A towers are also the schemes most exposed to Gateway 2 scrutiny, competence requirements and programme elongation.
City of London vacancy rates currently sit at around 7.4%, but this headline number masks a critical split. For Grade A towers, vacancy tightens dramatically to circa 2%, with flagship assets such as 22 Bishopsgate now fully occupied.
This imbalance explains why developers are continuing to push high-spec commercial towers forward despite:
- Higher build costs
- Longer programmes
- Increased compliance overhead
The planning data confirms that the Square Mile is doubling down on quality, not volume.
However, Grade A towers are also the schemes most exposed to Gateway 2 scrutiny, competence requirements and programme elongation.
Sustainability & Design Standards
Some of the individual approvals reflect a broader shift in City planning priorities, including higher sustainability thresholds and novel design approaches that also influence delivery planning.
For example, the approved 36-storey office tower at 60 Gracechurch Street was specifically highlighted by the City as a first generation of office building embracing a highly sustainable energy strategy through non-excavation construction and all-electric operation. These design priorities, while critical for net-zero targets, introduce additional complexity in material specification, system integration and early-stage coordination between design, sustainability and delivery teams.
Sustainably ambitious schemes often extend design iteration cycles and evidence production time, forcing contractors and engineers to account for thermodynamic modelling, embodied carbon tracking and compliance sign-off well ahead of physical construction.
Some of the individual approvals reflect a broader shift in City planning priorities, including higher sustainability thresholds and novel design approaches that also influence delivery planning.
For example, the approved 36-storey office tower at 60 Gracechurch Street was specifically highlighted by the City as a first generation of office building embracing a highly sustainable energy strategy through non-excavation construction and all-electric operation. These design priorities, while critical for net-zero targets, introduce additional complexity in material specification, system integration and early-stage coordination between design, sustainability and delivery teams.
Sustainably ambitious schemes often extend design iteration cycles and evidence production time, forcing contractors and engineers to account for thermodynamic modelling, embodied carbon tracking and compliance sign-off well ahead of physical construction.
Retrofit Is No Longer Secondary: It’s Structural
One of the most telling signals in the City’s data is that retrofit schemes accounted for around half of all planning applications in 2025. This is not cosmetic sustainability.
One of the most telling signals in the City’s data is that retrofit schemes accounted for around half of all planning applications in 2025. This is not cosmetic sustainability.
It reflects a structural shift driven by:
- Carbon performance thresholds
- Planning policy resistance to demolition
- Whole-life carbon assessments
- Occupier ESG pressure
Retrofit-led delivery brings its own challenges: unknown substrates, intrusive surveys, staged works and higher technical risk, all of which amplify testing, investigation and assurance requirements.
For contractors and consultants, this means more uncertainty, not less, despite faster planning approvals.
Pipeline Composition: Mix of Large & Medium Schemes
The cluster of approvals isn’t limited to a single behemoth. The combination of:
creates a heterogeneous pipeline with contrasting delivery risk profiles. High-rise developments typically have:
Meanwhile, mid-sized buildings often compete for the same limited skilled labour, specialist subcontractors, and testing/inspection capacity in 2026. A mixed pipeline increases demand signal strength but creates resource contention, which is a major upstream pressure on programme certainty and labour resilience heading into 2026.
The cluster of approvals isn’t limited to a single behemoth. The combination of:
- Mega-scale towers (e.g., 1 Undershaft)
- Mid-rise office buildings (e.g., 60 Gracechurch)
- Multiple 30–45 storey developments throughout the core cluster
creates a heterogeneous pipeline with contrasting delivery risk profiles. High-rise developments typically have:
- longer vertical logistics programmes
- higher crane and temporary works planning
- elevated safety and quality assurance reporting
- complex façade and vertical transportation installation demands
Meanwhile, mid-sized buildings often compete for the same limited skilled labour, specialist subcontractors, and testing/inspection capacity in 2026. A mixed pipeline increases demand signal strength but creates resource contention, which is a major upstream pressure on programme certainty and labour resilience heading into 2026.
Section 106, Infrastructure and the Hidden Programme Cost
Over the past decade, approved City schemes have generated more than £400 million in Section 106 and CIL contributions, funding major infrastructure such as:
While this demonstrates the City’s ability to extract long-term public value, it also reinforces a key 2026 reality: large City schemes now carry embedded programme and coordination complexity well beyond the red line boundary.
Ten new public walkways, utility interfaces and transport connections all increase:
This feeds directly into longer prelim periods and higher indirect costs, even on schemes with strong planning support.
Over the past decade, approved City schemes have generated more than £400 million in Section 106 and CIL contributions, funding major infrastructure such as:
- The Elizabeth Line
- Public realm upgrades
- Opened pedestrian routes across the Square Mile
While this demonstrates the City’s ability to extract long-term public value, it also reinforces a key 2026 reality: large City schemes now carry embedded programme and coordination complexity well beyond the red line boundary.
Ten new public walkways, utility interfaces and transport connections all increase:
- Third-party approvals
- Phasing risk
- Interface management
This feeds directly into longer prelim periods and higher indirect costs, even on schemes with strong planning support.
What This Means for 2026 Delivery Teams
The City of London planning surge is real, but it is not a return to pre-2020 construction conditions.
For 2026 delivery, the signal is clear:
Planning approvals are accelerating, but delivery friction is accumulating. Contractors, designers and developers who treat planning consent as the hard part done are likely to face:
This is not a warning against building, it is a warning against under-pricing certainty.
LCM Interpretation
The City of London’s record planning year confirms confidence in the Square Mile’s long-term economic role. But for those tasked with turning permissions into buildings, 2026 will reward discipline, evidence and realism, not speed alone. The planning system is moving faster and the delivery system is becoming heavier. Understanding the gap between the two will define who succeeds in the next cycle.
The City of London planning surge is real, but it is not a return to pre-2020 construction conditions.
For 2026 delivery, the signal is clear:
- The pipeline is full
- The regulatory bar is higher
- The margin for error is smaller
Planning approvals are accelerating, but delivery friction is accumulating. Contractors, designers and developers who treat planning consent as the hard part done are likely to face:
- Gateway delays
- Evidence production strain
- Competence-related cost uplifts
- Programme elongation risk
This is not a warning against building, it is a warning against under-pricing certainty.
LCM Interpretation
The City of London’s record planning year confirms confidence in the Square Mile’s long-term economic role. But for those tasked with turning permissions into buildings, 2026 will reward discipline, evidence and realism, not speed alone. The planning system is moving faster and the delivery system is becoming heavier. Understanding the gap between the two will define who succeeds in the next cycle.
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Expert Verification & Authorship:
Mihai Chelmus
Founder, London Construction Magazine | Construction Testing & Investigation Specialist |
