Legal & General Property is the first institutional investor to announce an intention to invest in the Greater London Authorities proposed multi-billion pound housing zones.

L&G Property’s Managing Director Bill Hughes said the company would be looking to invest in London’s “best zones” in the development that it’s envisaged will be worth billions to the construction industry.

Hughes told Construction News: “We’ve got a commitment to the sector, we’ve got some expertise, we have a significant volume of capital – all of those situations we’ll be reviewing.”

Commenting further he said they wouldn’t be looking to invest in every housing zone created in the GLA’s drive to boost housebuilding on brownfield sites around the capital.

It’s anticipated that there will be around 20 sites made altogether with boroughs in London having to submit their bids for some of the £400m funding by the end of September.

Recent government figures suggest housing starts are up by something in the region of 22 percent this year compared to last however the 137,780 homes started in the 12 months to June 2014 is still a way off the 200,000+ needed each year to get to grips with the housing market in the UK.

The government has set up a similar fund with around £200m for housing outside London in the hope they can attract investors from the private sector to work with local authorities to provide all types of houses including affordable housing and no doubt our new Planning Minister will be keen to see a significant proportion of bungalows built there as well.

The main benefit of the new housing zones is probably the ability to speed up the planning process so developers can get to work as quickly as possible, however it’s still early days in getting an understanding for how this will work on the ground, as an industry we should be thankful the large institutional investors are starting to get involved as this is what will guarantee the jobs construction desperately needs.