The South London shopping centre that has become a symbol of the housing crisis

“Greed, greed, greed,” says 86-year-old south Londoner Charles as he sips a Greggs cappuccino while watching the world go by in the Aylesham Centre in Peckham. “They want to knock this all down and for what… private housing nobody can afford.” This 80s centre with discount stores, a butcher, clothing shops and many empty units and the community which surrounds it finds itself in the middle of a battle over housebuilding in Britain. The site was earmarked for redevelopment by Southwark Council over a decade ago in 2014 and has been owned by housebuilding giant Berkley Group since 2021. However, earlier this year, Berkeley’s plans to demolish Aylesham and build 867 flats in major tower blocks here, of which 77 would have been affordable, were rejected by the Planning Inspectorate after years of back and forth with the council. The Planning Inspectorate ruled that the development did not include enough affordable housing, and that the scale of the development was not sympathetic to the local area. The Aylesham Centre in Peckham is earmarked for a housing development (Photo: Scarlett Milburn-Smith) Peckham, in south London, has become a desirable area, with house prices having risen to around £660,000, according to Rightmove – more than double the national average. This part of the borough of Southwark is, as the local MP Miatta Fahnbulleh – new Prime Minister Andy Burnham’s freshly appointed Energy Secretary – has described it, somewhere that “billionaires live in the same borough as families that cannot feed their kids”. And yet, while Southwark Council was the top council housebuilder in the UK for 2024-25 with 689 homes completed, the area urgently needs more housing. Southwark has a social housing waiting list of more than 22,000 households, with waits for a home reaching almost five years. The proposals would have seen the shopping centre demolished to make way for 867 homes (Photo: Southwark Council) When he was elected in 2024, former prime minister Sir Keir Starmer pledged to build 1.5 million new homes by 2029. However, the Government is well off target having built less than 400,000 in two years. The problem has been particularly acute in London, where the housing market has stagnated. Developers complain that they have a “viability” problem – they bought land at high values, inflation costs have pushed the price of building up, but mortgage lending is struggling to support new buyers. In an attempt to tackle this, former housing secretary Steve Reed introduced a cut to the amount of affordable housing developers like Berkley were required to build in the capital. Mayor of London Sadiq Khan has now reversed this, as The i Paper recently reported. Labour wants to compel local councils to consult ministers before refusing projects of more than 150 homes or more, like the one at the Aylesham Centre. However, barrister Hashi Mohamed, who represented the community in the dispute with Berkley here in Peckham, told The i Paper that there are sensitivities which must be addressed when approving large housing developments like the one proposed for Peckham. “This is a once-in-a-generation opportunity for Peckham to meet its local needs,” Mohamed said. “The development as Berkley proposed, it missed that opportunity because it didn’t include enough affordable housing and didn’t respond properly to the local context.” Claudia, a local mother of two, says plans for the centre are ‘completely unfair to the community’ (Photo: Scarlett Milburn-Smith) Mohamed, who also regularly acts on behalf of major builders on the other side of these disputes, continued: “The critical question for me is whether major developers can meet policy requirements which say that they’ve got to provide a certain amount of affordable housing for the community or not. “Berkeley’s perspective here seemed to be that they were the biggest investors in London and that local people in Peckham should be happy that they were doing anything at all.” “This is not about opposing housebuilding in Peckham,” Mohamed added. “The Aylesham Centre is very tired. Everyone expects something to happen here. Something needs to happen – everyone accepts that. But it has to be done right.” Attached to the Aylesham Centre is a large Morrisons and a car park. In an era where many people shop online, it is buzzing in the middle of a Wednesday afternoon. “[The plans] are completely unfair to the community,” says Claudia, a mother of two who lives nearby. “Where will people shop? This has been a shopping centre for generations – our grandparents would have shopped here.” Similarly, 39-year-old Emelle, a south Londoner who comes here regularly to do her shopping and buy things “from African shops that you can’t get anywhere else”, says any redevelopment in Peckham must work for the community. “There is a huge pool of people in this area that need a home, but even if they built 800 affordable homes here, it would still need to factor in the community,” she says. Prime Minister Andy Burnham has been praised for overseeing a housebuilding boom during his reign as mayor of Greater Manchester Since entering No 10 on Monday, Burnham has reappointed former Housing Secretary Angela Rayner and pledged a social and council housebuilding boom. 39-year-old Emelle visits the Aylesham Centre regularly (Photo: Scarlett Milburn-Smith) However, working out how to progress redevelopment sites such as the Aylesham Centre in a way that meets that pledge while also supporting developers, whom Britain currently rely on to deliver affordable housing, will be a crucial test of his premiership. Berkley is now appealing the Planning Inspectorate’s decision and has applied to the High Court for a judicial review of the decision. Rob Perrins, executive chair of Berkeley Group, said the Planning Inspector’s decision was “clearly flawed and will undermine the Government’s pro-homebuilding agenda unless it is swiftly quashed”. He added: “How can anyone invest in a town centre when policy-compliant plans for allocated sites are refused on the basis of vague and subjective heritage concerns? “It cannot be right that heritage concerns trump all other policies, including the delivery of new homes, jobs and growth. This decision has already shaken investor confidence, and it is a great shame that we now have to go through the courts to have it overturned. A Ministry of Housing, Communities and Local Government spokesperson said: “Our £39bn investment will deliver the biggest increase in social and affordable housing in a generation, and we’re fixing the planning system to make it faster so we can build the homes communities need.”