Following our earlier analysis on the commercial potential of the Silvertown Tunnel and Lower Thames Crossing, Glenny LLP's Commercial team take a deeper look at the immediate and long-term implications of the newly announced toll charges. While the infrastructure projects promise to alleviate congestion and enhance connectivity, the introduction of tolls presents a complex layer of financial and operational considerations for businesses across the South East London, Essex and Kent areas.
As Ivan Scott, Divisional Partner of our Kent Commercial Agency, highlights, the Blackwall Tunnel had previously been free for all vehicles. Now, it will incur daily charges alongside the Silvertown Tunnel from April 7, 2025. These tolls, ranging from £1.50 to £10.00 (depending on vehicle type and time of day), will undoubtedly impact businesses and their supply chain - reliant on frequent cross-river travel. Scott says;
“The imposition of tolls may have an effect on businesses based either side of the river who use the crossing intensively as part of their operational or delivery service,” Ivan explains. “This could, in time, force firms to relocate to one side of the river or the other, and in some cases, operators may choose to have a depot either side in order to efficiently service their north and south London operations – this will be wholly business dependent.”
“At present, all vehicles travel through the Blackwall Tunnel without charge. With the introduction of tolls, commercial fleets, spanning cars, vans, and trucks, will face increased overheads, potentially significantly impacting supply chain logistics. The added cost could force businesses to reassess their operational models. While the promised benefits of reduced congestion are undeniable, the financial burden of tolls could create a new set of challenges. For logistics and delivery companies, the daily cost of traversing the tunnels will accumulate, potentially necessitating adjustments to pricing structures or operational routes”.
John Bell, Equity Partner and Head of the Commercial Agency at Glenny says;
“The toll structure itself may also influence commercial property decisions. For example, we may see changes in commercial occupier density (both north and south of the river), if the cross-river “solutions” manifest themselves as additional barriers to business. Early indicators of a “resettlement” could, for example, be seen in an initial flurry of take-up of up of available logistics stock along the A13 corridor, or reduced demand in some south east London locations”.
When it comes to TfL's strategy (in relation to HGV tolls), Gwyn Topham, writing in the Guardian on Friday 4th April, cites Craig Rowe, TfL’s director of investment delivery planning, as saying;
“We’ve set these charges at the level required [£10 per Lorry] to ensure that we don’t induce additional traffic.”
Whilst this might be TfL’s aim from an environmental perspective, its economic and mobilisation impact on logistics businesses goes unmentioned.
As a Partner in a business with offices on both sides of the Thames John Bell is also mindful of broader business issues, stating;
“It is also important not to underestimate the impact upon labour pools. For example, individuals north of the river Thames who have taken up jobs south of the river (influenced by not having to pay tolls as part of their work commute), will now see weekly commute toll fees of £40 per week (for example, peak tolls for the Blackwall tunnel are now £4 each way); equating to just over £2,000 per year. Therefore, we may see possible increases in London’s public transport congestion, as previous tunnel commuters swap their own mode of transportation for cheaper public transport routes day to day”.
Despite these challenges and uncertainties, it's crucial to acknowledge the long-term potential of these infrastructure projects. Improved connectivity and reduced congestion, certainly outside of the M25, will undoubtedly create new opportunities for businesses across the region.
As the Silvertown Tunnel opens today, and with the Lower Thames Crossing opening in due course, the commercial property sector will undergo a period of adjustment. While the long-term benefits are promising, the immediate impact of tolls warrants careful consideration during this transitional window that will result in no toll-free routes for larger vehicles to cross the Thames east of Tower Bridge.
Glenny LLP is committed to providing our clients with expert guidance during this pivotal time, ensuring they are well-positioned to capitalise on the opportunities while mitigating the challenges.
Articles referred to:
https://www.bbc.co.uk/news/articles/crewy5472gxo
https://nationalhighways.co.uk/our-roads/lower-thames-crossing/
