My only concern with a Social Democratic Party is that, if it's the only moderate party, the spoiler effect inherent with a first past the post system will likely allow the Tories to win by default. In 1983, the SDP-Liberal Alliance were part of the reason Labour lost. Those dissatisfied with Labour had someone to vote for, but then none of the Tory voters would've voted for them anyway. All it did was split the opposition vote and pretty much helped in Thatcher securing her second term.
If there is a centre-right party though then the Tories will split too, and you'll end up with coalitions where things just won't get done. Then again, Germany has had them for some time now if I'm not mistaken. I'd rather the main parties either reform or be replaced by the social democrats and liberals forming another alliance party, and moderate conservatives make their own party too. I originally wished for just a liberal party that was serious about their policies, but I'll compromise with Bletchleyite here and just have them together. It would do good for a few voters.