While the need to avoid demolition is more urgent than ever, there are many challenges to overcome before a building can be retained. The next government could do much to improve the current system, writes Avison Young’s Laura Jenkinson
What makes a good building that is worthy of retention? And to what extent should a building be retained given the potential commercial drawbacks of doing so?
These are questions that we must ask ourselves as planners, architects and property professionals. While once the issues mostly focused on the heritage impacts, the climate crisis means the emphasis on the carbon cost of development is now laser sharp.
Priorities vary when it comes to retrofit. Full retention and minimum intervention is a priority for many lobby groups. For asset managers, at the very minimum it is about meeting an EPC rating of B by 2030 and delivering a lettable and viable building.
For office agents and tenants, it is all about functionality, location and accessibility. And, in some cases – for the most difficult buildings – only a change of use may be possible to safeguard a building from becoming a stranded asset. Or otherwise, it is full demolition.
>> Also read: What does the high court’s ruling mean for M&S’s Oxford Street plans? Lawyers give their views
Stranded assets do not work for any of us. A recent Business London paper notes that 85% of office stock in central London has an EPC of C+ and risks becoming stranded – and the cost of upgrading stock to an EPC lower than B could exceed £5bn in central London alone.
With 30% of London’s carbon emissions coming from industrial and commercial space, there is a need to substantially upgrade our building stock. But how do we do this?
The answer has to be with speed and pragmatism – and not through “retention puritanism”. As a result of a growing number of spot-listing requests, the planning system is slowing down.
We have recently seen this on one of our projects in Westminster, designed to be one of the first PassivHaus office buildings in London and targeting a LETI A rating, which is just about to become vacant and in need of urgent attention.
We submitted a certificate of immunity (COIL) as part of the pre-application process before it commenced in earnest, but despite the need for intervention, it took eight months to receive a decision on the COIL.
Heritage buildings are even more difficult. There are some fine examples of adaptation of some of the most challenging buildings – for example, the American embassy, which was purpose built in the 1950s but now converted to a hotel, and Millbank Tower, which is proposed to be extended and re-clad to ensure its continued use.
There is a pipeline of buildings that have been or are due to be adapted in the City of London with great success – 1 Appold Street, the Ned, Angel Court and many more. However, pragmatism can often be lacking.
While there were more sustainable options in embodied carbon terms, the public benefits associated with the proposals were considered to outweigh those impacts
Helpfully, the City of London is currently leading the charge on this issue with its “heritage buildings retrofit toolkit”, which acts as a tool to help decision makers work out where the balance lies, as well as their “carbon options guidance” and “retrofit fast track” approach in their draft City Plan.
There is currently much hype and sensationalism over retention. But, with the race to quality in the office market, and office attendance in London in January 2024 being 59% of what it was in in January 2020, something needs to be done urgently.
As my client, Oliver Hunt at Landsec, said at our Hill House planning committee in the City of London on 9 April, “our offices nowadays have to be more than just a place to work – they need to draw people in and earn the commute”.
>> Also read: Landsec unveils £250m plan to demolish Brutalist City block and replace with 20-storey office
>> Also read: Landsec gets OK for £250m City office block
For Hill House, we were retaining almost 60% of the existing structure and, while there were more sustainable options in embodied carbon terms, the public benefits associated with the proposals were considered to outweigh those impacts (in particular, a brand new and better functioning public library).
Our planners play a crucial role in this process – it is it is up to them to take a view on how public benefits may outweigh both heritage and carbon harm and find solutions – a heavy burden weighing on their shoulders. It is also up to members to listen to professional advice and make considered and balanced decisions.
Ultimately, there needs to be better direction from central government and the London mayor as to how to balance the various priorities, plus more flexibility for a case-by-case judgment per building, at the local level.
Key recommendations
So, how do planners and policy makers deal with this issue in London?
A national position on repurposing stranded assets
The starting point has to be, above all, a presumption in ensuring that stranded assets are firstly repurposed, and secondly redeveloped if there is a risk of vacancy – and all options that are considered need to be commercially and financially viable. The priorities of the NPPF should be balanced against the level of harm (including buildings being left vacant) and weighed against the public benefits of the development.
A flexible approach to a mix of uses
Many London boroughs require a mix of uses based on a minimum floorspace threshold, with no consideration of how efficient or viable such schemes are. Conversely, this often disincentivises developers to make the best use of land. Instead, where it can be demonstrated that this is technically unviable and undeliverable, 100% office schemes should be prioritised.
Flexibility on changes of use
Often, changes of use are the only option for ensuring the continued use of a building, particularly heritage assets, and these should be considered on a case-by-case basis. The London Plan should be proactive in promoting changes of use where this is evidenced for the long-term viability of a building.
Immediate intervention when required
Some buildings are so clearly stranded assets that intervention is required immediately and without any marketing. Local authorities should be able to ensure that assets do not degrade further (including verification through peer reviews where relevant) with flexibility through the London Plan, on a case-by-case basis taking an evidence-based approach.
Tax breaks for retrofits
This is something that needs to be prioritised urgently (including materials passporting). The planning system can also assist, through giving CIL and s106 breaks where viability is challenging and retrofit is being prioritised. The London Plan could also take a more strategic role in ensuring that affordable workspace policies do not stymy development. Just like affordable housing, CIL relief should be offered for affordable workspace.
A stronger emphasis on following recommendations and fewer committee decisions
A stronger code of conduct for members should be progressed, to ensure an evidenced approach is taken when making planning decisions. A minimum threshold for applications to go to committee set nationally (subject to the usual get-outs) could seek to reduce adverse decisions and free up planning officer time.
The upcoming elections offer an opportunity for a renewed focus and innovation in tackling London’s urban development needs. With a new administration, we look forward to a fresh, pro-development approach that will hopefully stimulate the industry and work with (rather than against) the mayor of London.
As stakeholders await the election results, there is hope for a cohesive vision that aligns with the goals outlined here, ultimately benefiting the city and its residents.
Laura Jenkinson is a principal in Avison Young’s planning team
Election focus
Low growth, flatlining productivity, question marks over net zero funding and capability, skills shortages and a worsening housing crisis all amount to a daunting in-tray for the next government.
This year’s general election therefore has very high stakes for the built environment and the economy as a whole.
For this reason, Building has launched its most in-depth election coverage yet, helping the industry to understand the issues in play and helping to amplify construction’s voice so that the government hears it loud and clear.
1 Readers' comment