Bromley goes public on ZhongRong’s 500-year Palace dynasty

Bromley Council has published explosive correspondence to expose how the ZhongRong Group, the Chinese company to which London Mayor Boris Johnson wanted to hand a large chunk of Crystal Palace Park, were demanding to takeover half of the public park on a 500-year lease, and to be allowed to build anything that they wanted, unanswerable to the local authority.

London Mayor Boris Johnson with Chinese industrialist Ni Zhaoxing on the steps of Paxton's original Crystal Palace in October 2013. Talks had already been going on over the scheme in secret for two years

London Mayor Boris Johnson with Chinese industrialist Ni Zhaoxing in October 2013

Mayor Johnson had launched the ZhongRong scheme on the terracing of the original, Victorian Crystal Palace in October 2013, alongside the head of ZRG, Ni Zhaoxing.

Johnson and Ni claimed that ZRG wanted to build a £500million replica of the original Crystal Palace on the site. The New Statesman described the scheme/scam as a “boondongle” and called it Johnson’s “grandest, most pointless project yet”.

It took more than a year to uncover that behind the scenes, the backers of the ZRG Crystal Palace scheme included a Tory peer and a Conservative Party donor, and that Johnson and his officials at City Hall had been negotiating in secret for almost two years.

The negotiations eventually broke down last month when ZRG failed to complete 16 months of negotiations while they had an exclusivity agreement with Bromley Council, who manage Crystal Palace Park.

The exclusivity deal was arranged by the Mayor of London, without any rival bidders or schemes being considered for the redevelopment of the “Top Site” of the park, which has stood near-derelict since Joseph Paxton’s cast-iron and plate glass Crystal Palace, originally built for the Great Exhibition of 1851, burnt to the ground 80 years ago.

A Boris boondongle: Bromley's latest letter underlines how Chinese developers wanted to take over much more of Crystal Palace Park

A Boris boondongle: Bromley’s latest letter underlines how Chinese developers wanted to take over much more of Crystal Palace Park

Ahead of a council meeting tomorrow night, Bromley Council has released documentation from the final months of the negotiations with ZRG, including a letter from their director of regeneration, Marc Hume, to the Shanghai offices of ZhongRong.

Hume’s dynamite letter reveals that, at the beginning of September 2014, ZRG had written to Bromley with a new set of demands:

• ZRG wanted to increase the land to be acquired to the equivalent of a third of the Park and include the Terraces and Sphinxes in the purchase.
• ZRG would show Bromley their business plan in due course but it would be non-negotiable.
• They would accept an initial 125-year lease but this would require a change to an Act of Parliament, and on securing a change in The Crystal Palace Act, this would increase to 500 years.
• They were not willing to pay the GLA’s and Bromley costs relating to the sale.
• They continued to question the need for planning permission once they had secured the purchase.

In Hume’s letter from last month, the Bromley council official writes, “In your letter to me dated 11th February you stated that ZRG will only consider these conditions if the Council first agrees a ‘Revised Lease Document’ which you attached to your letter of 11th February. It is most regrettable that ZRG has refused to agree to these conditions by the required date.”

That was merely Hume lighting the fuse. The really explosive stuff comes in the next paragraph: “Turning to the ‘Revised Lease Documents’ you have submitted, you are fully aware that there are a number of fundamental terms that are non-negotiable so far as the Council is concerned and we have made these plain to you on repeated occasions over the last 16 months. These terms are fundamental to the Council because of its obligations as a public body to safeguard the historic and sensitive nature of the site, and to preserve the rights of the public at large in respect of the site, as well as ensuring that the various statutory limitations on its future development – in respect of planning and the obligation to obtain best consideration for Council owned land, as well as the requirements of Crystal Palace Acts – can be satisfied.

“Having considered the amendments you have made to the draft agreement and lease, it is clear that you have taken no account of the Council’s concerns and have ignored our requirements. The result is that we have made no discernible progress over the last 16 months.”

Hume concludes: “In the circumstances, it appears that there is no realistic prospect of us reaching a satisfactory agreement on these and other matters and, consequently, no point in renewing the Exclusivity Agreement or continuing discussions any further.”

This does raise the matter of whether, having had the ZRG deal foisted upon them by the Mayor of London for another of Boris Johnson’s vanity schemes, who will compensate Bromley Council Tax-payers for the estimated costs of the fruitless project – estimated to run to at least £100,000.

Christian Wolmar, who is campaigning to win the Labour nomination to stand as London Mayor next year, condemned Boris Johnson’s role in the saga: “Yet again, it is the people of London who have been left to pick up the consequences, and costs, of a Boris Johnson vanity scheme.

“It is essential that major developments throughout our city are affordable, liveable and sustainable – and any future Mayor should be working with the boroughs to ensure such schemes deliver for Londoners.”

The Bromley letter from Hume does demonstrate what a local authority official can do, properly on behalf of residents and businesses, when confronted with a the juggernaut of big business and Tory-supporting developers. Perhaps someone should show it to Hume’s colleagues working in Croydon Council.


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2 Responses to Bromley goes public on ZhongRong’s 500-year Palace dynasty

  1. Peter Rogers says:

    ‘Perhaps someone should show it to Hume’s colleagues working in Croydon Council’ and their reaction would be ‘but we’ve started building roads and knocking things down – offer them more public money’

  2. whitgiftavenue says:

    Despite the inevitable collapse of this ludicrous scheme, I hope the efforts of the fourth estate, in uncovering the background to this sordid affair continues. Why was ZRG , who have built a handful of projects in China but nothing in Europe or the US, considered worthy of being gifted a listed historic London Park?

    This saga also gives rise to wider questions relating to the governance of London and the priority given to foriegn interests over those of Londoners.

    While the Mayor’s conduct was predictable, the role played by enthusiastic GLA officers in the secret promotion of this scheme is very worrying. It is surely time that they were bound to a code of conduct at least as vigorous as those which bind the Civil Service.

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