The art of retrofit: finding value in vintage

Twenty years ago, faced with an ageing office building that was “no longer fit for purpose”, the default position of developers and investors was to demolish and rebuild. Creating shiny new office space was a banker for attracting tenants and while building reuse did happen, it was fairly limited.

How the world has changed! It’s increasingly rare for a project involving the development of a site with an existing building or buildings not to at least consider retrofit, and the numbers of buildings being re-used is rightly on the increase.

We’re seeing demand for sustainable office space coming from both the top – the investors – and the potential occupiers. This is where the ‘art’ element of the process comes in. After all, does anyone choose a new office purely because it has new building services or a more effective building management system?

Less tangible aspects

While energy use and cost effectiveness are important, far more tenants chose on the basis of a combination of other factors: location and amenities, of course, but also those less tangible or measurable aspects, ‘gut feel’ and a sense of ‘I could see me and my colleagues here’. Increasingly, we’re also seeing occupiers looking for landlords who they believe align with their culture and values.

Our approach to retrofit projects responds to this and combines quantitative data, such as life cycle carbon analysis, with qualitative considerations that use our knowledge and experience to incorporate heritage, planning risk, marketability and trends in a particular location.

Hodge House (pictured) in Cardiff is a great example of this. Built in 1915, it’s a Grade II listed, multi-tenanted building that we’ve recently retrofitted for LGIM. Given its listed status, the works are less visible from the outside, with the fabric focus on weatherproofing, insulation and new MEP systems. We undertook a programme of restoration including the bell tower and clock: important elements of the building’s identity. An internal deep retrofit has included the introduction of hospitality-quality communal facilities and incredible amenities for sustainable commuting, making it a sought-after location in Wales’ capital. The building was partially occupied throughout and is now almost fully tenanted.

Lifecycle carbon analysis

At Neighbourhood North in Bristol (also for LGIM), the team’s decisions were guided by lifecycle carbon analysis from the earliest stages, so every decision balanced embodied carbon with operational performance, which led to a dramatic improvement in energy performance.

We removed dated external features and integrated a new extension into the existing structure, improving the building’s overall appearance. A host of enhancements, from an extended reception area to new high-performance systems, have improved energy efficiency and occupant comfort and health while creating an inviting office for tenants. This was borne out by the achievement of a pre-let for the entire building.

Critical to these projects, and to the success of retrofit more generally, is the attitude of tenants and their advisers. I’ve seen a couple of deals fall over recently because tenants expect retrofitted space to be cheaper than a new building, making it an unviable option. This isn’t always the case, given how complex – and at times risky – a retrofit project can be.

If the industry is going to achieve the targets that we have set ourselves, we all need to play our part to upgrade our existing building stock, be that through investment, rent and/or accepting temporary disruption for the longer-term good.

Vintage not second hand

We need to think about re-used buildings more as ‘antique/vintage’ and less as ‘second hand’ and assign value to the heritage they offer, often alongside a solid structure, new services and workspace with character. This is especially relevant in markets outside of London growth areas and other regional cities, where rental levels are already lower.

Accepting that the highest levels of quality and creativity aren’t always found in the new is an important step in enabling more of our ageing office stock (even some that may be considered ‘ugly ducklings’) to continue a useful and valued life with all the benefits that brings.