In with the old: Office building upgrades show the way forward

The move towards prioritising retrofitting or refurbishing office buildings over demolish and rebuild shows no signs of slowing down. Deloitte's latest London Office Crane Survey, published last summer, shows that refurbishment activity has dominated, accounting for almost 2m sq ft or 83% of activity across 23 schemes.

New-build commitments, on the other hand, struggled, recording less than 500,000 sq ft of activity starting across just seven schemes. “The decrease in new-start activity when paired with the disparity between activity of new builds versus refurbishments brings into sharp focus the strain that London developers are under,” the report states.

Frederic Schwass, chief development officer at office specialist General Projects, says that ever since the business was set up 10 years ago, the majority of its projects have been retrofit. “For us, it’s always been retrofit first,” he explains. “We believe that there are no such things as unloved buildings, especially buildings from the post-war period.”

He adds that with a little bit of creative thinking, even tired buildings from the 1960s and 1970s can be repositioned as grade-A office space.

All change: the top two residential floors at 25-27 George Street will become prime office space with terraces

Nathalie Bergvall, director at John Robertson Architects (JRA), says the question is no longer whether or not to retrofit, but how far to take it. “We routinely test various scenarios with our clients, ranging from light-touch refurbishments through to deep retrofits that target full decarbonisation, low embodied carbon and best-in-class sustainability credentials,” she says. “Demolition and rebuild options are still interrogated but, in most cases, they fail to compete.”

General Projects’ approach does not normally involve preserving buildings in their entirety. Schwass cites the example of its Metropolis development in Westminster, which was formerly Woolworths’ headquarters.

“It came to the market back in 2018 and we always approached it as a retrofit with significant extensions,” he says.

“That’s usually how we add value – by adding net internal floorspace. We managed to increase the net area by 40% by infilling the courtyard at the back, as well as adding a floor and a half.”

The extension at Metropolis was completed using cross-laminated timber (CLT) with a steel frame, which, in addition to the embodied carbon savings from retaining the original structure, adds another environmentally sustainable element. “It’s a more sustainable method of construction,” says Schwass. “In some instances, we do all of the extensions in full mass timber, so we use CLT for the slabs and glue-laminated timber for the frame because it’s sturdier.”

So the green agenda is certainly a motivating factor, but taking a retrofit-first approach can also save time and money – although achieving either requires a lot of judgement calls. “If done right, it is cheaper – not significantly cheaper, but it can be cheaper,” says Schwass. “If not done right, it can also be a lot more expensive and that’s where we have to be very careful. There can be very costly mistakes and it’s all about knowing your building inside and out.”

Refurbishment aligns sustainability with long-term value Nathalie Bergvall, JRA

Clive Nichol, founder and managing partner of developer Fabrix, says many buildings constructed within the past 20 years are structurally excellent and in strong locations, but they require significant upgrades to both the fabric of the building and the amenities on site to let them into today’s market. “The question has become less about chasing certifications and more about delivering buildings that perform environmentally, technically and experientially,” he says.

However, with careful thought, developers can deliver a product that keeps “sustainability goals and modern amenity needs front of mind”, he adds.

Mix and match: Fabrix is converting a disused office building in Elephant and Castle into student flats and affordable homes

According to Bergvall, retrofitting increasingly makes good business sense for building owners. “It is often the only viable route to bringing space to market within realistic timescales,” she says. “Refurbishment is compelling precisely because it aligns sustainability with long-term value. The most sustainable building is the one already standing and this principle now underpins commercial decision-making as much as environmental strategy.”

JRA’s 25-27 St George Street project in Mayfair is a good example. The top two floors of the eight-storey building were previously used for residential, but these are now being reconstructed using mass timber and turned into modern office space. In addition, terrace spaces are being added to increase the urban greening and local biodiversity. The scheme is due to be completed in early 2027.

Planning priorities

There are other reasons to prioritise retrofit. Nichol points out that planning authorities are, to a greater or lesser extent, increasingly pushing the approach through planning policies. “A retrofit-first planning policy has already been implemented by Camden, Westminster and the City of London, making refurbishment expertise essential for anybody looking to do business in those core locations,” he says. “Other councils will follow their example.”

Mark Swetman, chief executive of LS Estates, which specialises in retrofit development, believes developers and landlords also need to have at least one eye on future regulations. The government is yet to announce its plans for Minimum Energy Efficiency Standards (MEES) for commercial buildings but, when it does, the reforms are expected to raise the bar.

Future-proofing: Fabrix’s Bow Bells office scheme will upgrade energy efficiency and capitalise on the views over London

“Policy is shifting again – EPC [Energy Performance Certificate] reform will bite and it will feed straight into MEES,” he says. “That’s why we focus on deep retrofits that produce a top-tier spec.

Light-touch compliance work doesn’t future-proof anything.

Occupiers expect buildings that can survive the regulatory changes coming towards them. [That means] smarter systems, low-carbon or all-electric, and genuine efficiency – not green gloss.”

There are risks, though. Before embarking on a retrofit project, it is essential to spend a lot of time making sure you understand a building inside out, Schwass says. “It’s about undertaking as many investigations as possible in the early days,” he adds. “What we try to do is pass on the risk to the contractor and obviously they don’t want to take the risk without knowing the building.”

Usually, this entails spending thousands of pounds conducting site investigations to understand how a building was built, even if the documentation is available. “We still want to open it up, because sometimes documents say one thing but it doesn’t necessarily mean it was built that way,” he says.

One Hanover Street, London W1

Last month, The Crown Estate announced it had pre-let all 124,000 sq ft at One Hanover Street in central London to alternative investment manager Ares Management. The six-floor scheme, above the Apple store on Regent Street, is being developed by The Crown Estate’s Regent Street Partnership joint venture with Norges Bank Investment Management.

Plans for the redevelopment include the creation of a new rooftop pavilion and seventh-floor terrace overlooking the West End. Ares currently occupies 39,000 sq ft at The Crown Estate’s 10 New Burlington Street building, also in the West End.

The estate says the office refit supports its broader long-term vision to “curate a vibrant and resilient destination in the heart of London”. Kristy Lansdown, managing director for development at The Crown Estate, says: “One Hanover Street marks the latest step on our journey to reinvigorate our portfolio across the West End, with an ambitious vision that looks at the entire area.”

The overhaul will reposition the heritage building as a modern, sustainable workspace. Lansdown adds the estate is also working with Westminster City Council to rethink the public realm around the development to create a “welcoming, accessible and resilient place that benefits workers, visitors and residents alike”. The redevelopment is scheduled for completion in Q1 2027.

This article was written by Adam Branson and appears in Property Week here