Forecasting figures Gathered at the UK head offices of leading architect Swanke Hayden Connell, some of the UK’s top occupiers, developers and architects talked through the issues affecting the office market today. Noella Pio Kivlehan reports
Attendees
Nick Pell Swanke Hayden Connell Architects principal, interior design
Steve Brown Swanke Haydne Connell Architects principal, architectural design
Chris Goldthorpe Sense Cost Consultancy managing director
Julian Tollast Quintain Estates & Development head of design development
Gary Wingrove BT Group Property head of construction property mangement
Patrick D’Arcy Deutsche Bank director strategic programmes
Richard Norton Jones Lang LaSalle director
Paul Lewis Stanhope operations director
Stephen Brown GVA Grimley head of planning, development and regeneration
Q Are occupiers changing their occupational requirements, and will this have a bearing on the type of office building that will be created and its location? Do they still care about the green agenda?
Gary Wingrove BT very much measures the public perception of what counts as green agenda, and it was found to be slipping in the past year. But it’s very much back in the board room. The problem we have is the way we occupy our buildings. We have a huge amount of old stock that we can’t get out of, so we will have to use those buildings. We’ll probably come out of some of the newer buildings, which we can easily sublet. Another problem for us is how you marry good design with an old building. We are very much back to using the regions and spreading the work across them. With the regions, there is low cost, and also carbon footprint.
D’Arcy We have done the largest refurbishment this year in Europe with our twin towers in Frankfurt. That’s a 55% reduction in terms of its energy capacity, 78% in terms of water, and an 89% on CO2, so we don’t make that investment lightly. The refurbishment is not dissimilar to a new-build. The buildings we have got today we want to sweat harder, and the buildings that we will want tomorrow we will want to sweat harder than the BCO standards. We will be looking for greater density and greater flexibility. Our basic requirements are going to change, and our occupational requirements are going to change.
Steve Brown Do you see any change in the way the organisation operates?
D’Arcy We are looking for more mobility among the workforce. We want greater home working. We are looking to drive work space harder, and a lot of those projects demand that.
Steve Brown Is that a desire to get more utilisation out of your existing buildings?
D’Arcy We want to get more out of the buildings we are in, and we also want to take the opportunity to get out of the number of buildings that we are in.
Nick Pell I have been working alongside occupiers who want to embrace a green agenda. There is no question that clients are interested in being sustainable, as long as the price tag is not too much.
Norton It will probably take more than 10 years for payback.
Pell We are also noticing this need for adaptability rather than just flexibility, but there is only so much that can be adapted from the BCO from an occupiers’ perspective. But how could buildings be designed to be adapted to retain value? There are a huge number of occupiers who are not educated. They don’t know what’s best, and what they need.
Lewis The whole story is from that initial conversation, and where the occupier comes from. The green agenda is everything, including the location.
Q What are the planners going to be looking for with a new generation of offices?
Stephen Brown Planners will be looking for everything. The building has to be viable, and it has to be energy and sustainability efficient. It has to create a sense of place around it rather than just being a building. It has got to be regenerative, and increasingly, it has got to meet the needs of the occupier rather more because we are going to see more bespoke buildings.
Pell They will be looking at mixed-use buildings, in which a building accommodates residential and offices
Steve Brown Generic buildings that can be truly adaptable. And so the investor can change the use of the buildings.
Stephen Brown The British system has not been very good at producing mixed-use buildings, but I suspect we will see more mixed-use areas, rather than mixed-use buildings. The big task with the planning system is explaining realities and costs.
Q Are we going to see new types of construction?
Goldthorpe Yes, within the source of materials and how they will be put together. Flexibility, and how you get around a permanent structure – that is the big dilemma.
Lewis There will be more site assembly, rather than site construction
Norton Data centre providers say what they now produce is a basic shed, and everything else is produced off site.
Q In the short term, are we going to see a resurgence of refurbishment schemes because new development cannot be justified?
Lewis Yes, it is a whole area that became very strong.
Stephen Brown Local authority statistics will show that is recession has seen significant increases in refurbishments applications along with a drop off. A lot of those refurbishment schemes are extending floorplates, extending the height of buildings. These are very sophisticated approaches.
Norton From the investors’ perspective, with so little speculative development going on in the past two to three years, if you can reposition grade B stock with grade A, then that is good.
Q What will be the priority with office fit-outs?
Wingrove It’s not so much about desks for us. We have got 15% of our workforce working from home, 35% don’t have an allocated desk, so 50% don’t have a desk in an office. If you come into a BT centre, the busiest workplaces in the building are cafes, where people come in, have a meeting and log on. So, we are still starting to think about how much space we need and how much flat surfaces – so that’s what the future is – to prove how much space they need. A lot of it is to do with change
Q Is the BCO still fulfilling the needs of its members?
Wingrove In general terms it is. Things like the specification need to be much more to do with living-type documents, because things change so quickly in our sector. Things in 12 months may not be the same as the next 12 months after that. We need to keep up with research, and we need to keep revising our documents. It is something that the BCO is looking at.
Norton The BCO just needs to make sure that it is outward focused, not inward focused, and that it continually updates information. And if that information is updated, when the investors, the developers, the occupiers use it, and it will become relevant. At the moment, it’s a reference point rather than a focal point.
Tory reforms: good politics but bad planning
David Cameron correctly called his proposed changes to the planning system – Open Source Planning – “one of the biggest shifts in power in decades”. It’s more radical than anything we’ve seen in 30 years ,and for a development industry that is both in a delicate state and has been subjected to continuous planning reform since 2000 – what are the implication of this further uncertainty?
Take, for example, a simple office scheme. If your application: complies with an up-to-date local plan; is sustainable; the planning tariff has been paid; and the local community supports it, then you will get permission. A good start!
But what exactly does “complies with the local plan” mean? That plan will have been produced “bottom up”, with residents delivering a shared vision for the form, scale, location and rate of delivery of all types of development, including “unneighbourly” ones. How much new office floorspace will the plan have identified, and where? Provided the plan is in line with national planning objectives, its content will be determined solely at a local level.
Of course, your scheme is “sustainable”. You’ve grudgingly paid the tariff, so your focus is now on securing support from the local community. In the Tory’s planning world, decisions can be based on the views of a “significant majority” of neighbours, but you will have the right to buy their support – sorry, reach a voluntary agreement to compensate nearby householders for the impact on their amenity in return for their support. This is riddled with potential problems: What impact; how many; how much; how is it policed? Worry not. The Conservatives believe that comprehensive pre-application consultation “may lead to unanimous local support”.
Even if the authority approves your scheme, there’s the new hurdle of third-party right of appeal, which could be exercised by your neighbour or commercial competitor – a recipe for huge delays, as you cannot progress development until it’s been resolved. If, however, your scheme is refused, you have no right of appeal if the refusal was “in line” with the local plan.
These proposals might be good politics but are bad planning. At best, it is wholly untested and wildly optimistic; at worst naïve.
Ian Blacker is head of planning consultancy, John Rowan & Partners
