Midway through October, we witnessed one of the most impressive refurbishment projects of recent times open its doors. Over the past ten years, Battersea Power Station has been transformed from a Grade II-listed coal power station to a development of 254 flats and a multitude of restaurants, bars, offices and shops.
The sky is the limit when it comes to the possibilities of refurbishment. But it’s also a risky option for developers. Let’s explore a little deeper…
Untapped potential hiding in our cities and towns
We all know that the UK housing market doesn’t produce enough houses. But the one thing we do have a lot of is redundant buildings. In every town and city centre, legacy properties are sat empty, often for many years. This is a waste of the huge potential to transform these so-called brownfield sites – including churches and old industrial buildings like mills and factories – into high-quality accommodation bursting with character.
But who is willing to take on the challenge? Developers aiming to transform these complicated old buildings will have to face the fear of the unknown. There’s no telling what surprises will be in store, from structural issues and roof collapses to planning permission hurdles. Many developers I know have given up on refurbishment projects due to the complexity of the planning system for brownfield sites.
All this uncertainty and unforeseen additional work is expensive. It’s a lot cheaper and more predictable to simply knock the building down and build something brand new and bigger on the site. No wonder that this is a tempting option for developers who find a brownfield site on their hands.
Before you wheel out the wrecking ball, let’s look into some reasons to revamp.
Fossil fuel footprints
Have you heard of ‘embodied carbon’? This term refers to the carbon emitted during the construction of a building – in other words, its carbon footprint before it even becomes operational.
The embodied carbon of old buildings goes to waste if they are just knocked down. By ‘recycling’ these existing structures, refurbishment is a more environmentally friendly option – which is hotly in demand with buyers.
The construction industry is the biggest carbon emitter of them all, with a whopping 40% of the UK’s carbon emissions coming from the built environment. Think of all the energy that goes into creating glass, concrete and bricks – not to mention emissions from transportation.
There is currently a loud call in the industry to record the carbon lifecycles of buildings or to issue each building with a carbon rating, similar to the EPC rating. This would create accountability and give buyers something to measure the carbon footprint of properties against, increasing demand for sustainable builds.
The biggest strength of these brownfield sites is their character. Buyers love the chance to own something truly unique, their imagination captured by its backstory of history and rebirth. Tall ceilings make the property feel airy, and the ‘quirky’ layout that gave you a headache during development is all part of the charm for your buyers. These developments are worlds away from cookie-cutter new build apartments.
The best of both worlds
When you refurbish, you have a chance to make your building a lot more energy efficient by strengthening its double-glazing and insulation. And why not investigate clean power options like solar panels? It’s a bigger challenge, but this way you can combine the vintage look and feel of a vintage building with a higher EPC rating fit for the 21st century.
That’s good news for buyers who want the best of both worlds, and good news for your property value too.
Whichever way you look at it, conversions are fraught with difficulties. But they’re also worth the investment. Personally, I believe that there also should be financial incentives to use brownfield sites, encouraging developers to breathe new life into these historic properties.
You can overcome uncertainty by having the right contingencies in place. RQ Capital can help ensure you are fit to face the challenges that your ‘characterful’ refurbishment throws at you.
Our small, friendly team takes a personal approach to every loan. We understand the difficulties that developers often face, and we’re happy to work through them together through collaboration and communication.
Talk to us today about how we can bring your next refurbishment project to life.