Assessment Tools such as space analyses and post-occupancy evaluations help both tenants and landlords. Surveyors take note, says Nigel Oseland
Occupiers are always chasing value. To supply it, agents, developers and property consultants will need a range of evaluation methods.
Agents already know about property valuations, which provide an opinion of the price a property might achieve if it is sold or the potential rent generated if it is let. Likewise, they will recognise the comparative analysis, often presented in the form of a building evaluation matrix, which uses a range of agreed criteria to assist in the selection of the best building for their clients from several shortlisted options.
The analysis usually includes financial criteria such as rent, rates and service charges, non-financial criteria such as lease length and termination options, and location-related criteria such as access and local amenities, as well as basic data such as size and heating/ventilation mode. The criteria may be weighted and then combined to produce a single evaluation score.
Agents will also know about the building survey, sometimes referred to as a structural survey or building condition survey, which is within the realm of the chartered surveyor. This is an investigation and assessment of the construction and condition of a building, including its structure, fabric, finishes and the surrounding grounds. The surveyor’s report will identify any problems, include references to visible defects, and offer guidance on maintenance and remedial measures. If a significant problem is identified, the surveyor may recommend that a more detailed structural investigation is conducted.
It is at this point that evaluation methods often become more specific and more occupier centred. The surveyor, or often the architect, may be required to provide a measured survey, also referred to as a dimensional survey. This involves taking measurements in order to prepare accurate scaled drawings. The drawings may then be subjected to a space analysis, which is used to generate space metrics. A typical analysis includes measurement of the gross internal area (GIA), net internal or lettable area (NIA/NLA), a desk count, measurement of the area occupied by enclosed offices, the area required for primary circulation routes and areas of unusable space – for example, under stairwells and in angular corners – and the number of meeting rooms and associated seats. Space metrics include occupational density (m²/desk), tenant efficiency ratios (NIA:NUA), floorplate efficiency ratios (NIA:GIA), percentage of cellularisation and ratio of meeting rooms to open-plan desks.
An extension of comparative analysis is a full building appraisal, conducted by architects with some engineering input, on behalf of a specific occupier. This study involves an assessment of the architectural aspects of several buildings in terms of the benefits to the potential occupier. It uses detailed space analysis, as above, identifies highly serviced areas, fire egress routes and space with access to daylight, and includes an assessment of the planning and column grid.
The architect will also provide an opinion of the suitability of the building’s location, which includes the appropriateness of the business district, its external features and presence, and its potential for division into sublet areas. A building appraisal report includes both the architect’s qualitative opinion and a quantitative analysis, which provides a weighted score for each building. Some firms of architects also score how well the building meets the British Council for Offices’ Guide to the Specification of Offices, considered to be the best practice standard for landlord (category A) fit-out.
In a tenant enticement study, the architect acts on behalf of the agent. Generic layouts are created to show how the building may be space-planned efficiently for different types of occupier. A highly cellular layout, highly open-plan layout and mixed layout are produced for typical floorplates and presented with accompanying space metrics, such as the occupational density, in the letting brochure.
Assisting in rent reviews
Architects are increasingly being invited to assist in rent reviews on behalf of either the landlord or the tenant. And an appraisal for a rent review is similar to a building appraisal, but the output is used in rent negotiations. When the rent is up for renewal, the landlord may approach the tenant and present benchmark data, in the form of a building appraisal of similar surrounding buildings, to show that the occupied building offers the best rental value and therefore warrants a rent increase. Conversely, the tenant may use the benchmarking of similar buildings as evidence that its rent is not good value. As part of the review, an architect is expected to provide a written statement that clarifies their credentials, presents their qualitative opinion of the building and offers assurance of the validity of the benchmark study.
The next stage of evaluation is much more focused on determining whether the building meets the occupier’s requirements. The Royal Institute of British Architects excluded stage M – feedback – from their standard Plan of Work back in 1967, possibly due to potential litigation and professional indemnity issues.
It is now rumoured that stage M will be reinstated in the forthcoming revision of the Plan of Work. The aim of the feedback stage is to analyse the management, construction and performance of the project through an inspection of the completed building and a study of the building in use. Assessing the performance of a building once it is occupied, rather than at the design, construction or commissioning stages, is commonly referred to as post-occupancy evaluation (POE). The information received is used to indicate quality and help determine the project’s value, and is also used in feedback sessions with the designers.
The facilities management industry has also adopted the POE to determine its customers’ – the occupants’ – satisfaction with the operation of the building. Engineers have for some time used POE to explore the relationship between perceived comfort and environmental conditions. Furthermore, some developers are now expressing interest in the ways that POE may be used to inform and improve the design of their future developments.
POE is considered to be the latter stage of building performance evaluation (BPE). In the book Assessing Building Performance (Elsevier 2005), Preiser and Vischer propose that BPE be “feedback and evaluation at every phase of building delivery, ranging from strategic planning to occupancy, through the building’s life cycle. BPE is a way of systematically ensuring that feedback is applied throughout the process, so that building quality is protected.” Similarly, the Office of Government Commerce advocates continuous feedback and considers performance evaluation to have three key stages:
● project evaluation – an ongoing check of how well the project is performing during design and construction;
● post-project review – an evaluation conducted after construction and focusing on how well the project was managed;
● post-implementation review – an evaluation carried out when the facility has been in use for some time, used to determine whether the anticipated business benefits have been achieved; this latter stage is the same as POE.
POE at minimum includes obtaining feedback from the occupants, who can comment on the success of the building in supporting business activities and in meeting their individual requirements. Evaluating the performance of a building or portfolio of buildings may involve measuring and benchmarking key performance indicators. In addition to staff satisfaction, the KPIs measured may include fit-out cost, total cost of occupancy (including rent and services), occupational density, space utilisation and design quality.
Occupant feedback may also be used to identify potential technical issues which can then be verified by detailed evaluations. Technical reviews, such as environmental monitoring, energy audits and maintenance reviews, predominantly involve testing materials, engineering and structure in relation to building operation.
Performance linked to workplace quality
The relationship between workplace design and business performance is considered so important that the British Council for Offices and the Commission for Architecture and the Built Environment (CABE) have carried out initial research and commissioned Swanke Hayden Connell Architects to produce a guide to POE for office fit-out projects, to be published in the autumn.
Agents and property consultants need to take heed of the link between buildings and business performance because measuring performance rather than conducting valuations will be integral to their service offering.
Dr Nigel Oseland is a partner in Swanke Hayden Connell Architects,
oseland.n@london.shca.com
