Property: Back to the future

By Matt Balmer
May 12, 2018

Rory Cramer, head of consultancy at Marsh & Parsons New Homes, explores the trend for converting heritage buildings and how their history appeals to London buyers.

The capital is lucky enough to boast a large number of heritage buildings from warehouses and factories to power stations – all of which offer unique opportunities to be transformed into new homes.

It is an opportunity to bring redundant buildings back to life and make a positive contribution to their local area. With this comes the balancing act of preserving the past and finding the best way to move forward, facilitate good design, and maximise the number of homes. In today’s market, we are seeing a shift from location- driven to more product-led, as buyers increasingly focus on architecture and design when considering buying a home.

A developer will always look at both options – converting or building new. The key aspects in a conversion-ripe property include its character, ceiling heights, configuration (i.e. not too narrow or deep), condition, parking requirements, and planning designation. The outcome will normally depend on market forces. If the developable area does not change significantly and premium sales rates can be achieved, a conversion becomes more appealing. But if demolishgin can deliver a substantially larger scheme, that will usually win. Retaining a façade to allow for a new build or adding a rooftop exension are also popular. This also means developers can preserve period features and combine them with modern design such as open-plan layouts or underfloor heating.

However, converting a building is not a straightforward option. It entails a lengthy consultation process, in addition to working closely with councils and other building and heritage experts. Local communities are often more enthusiastic about buildings of merits being preserved, which in turn influences politicians. Other considerations might take precedence: does converting an existing building into 50 homes do more for a local community than delivering 100 in a new build? This debate could run and run.

Cost overrun is one of the biggest challenges when converting. Somewhat surprisingly, refurbishing is often more expensive than building new, and significant delays are common as issues with the property’s existing fabric arise during construction.

Heritage is often used as a differentiator in this overcrowded new development market. Whether it’s a new build on a historical site or a conversion, it can inspire marketing materials right through to the interior design and create a unique proposition – all of which can, in turn, have a highly positive effect on sales.