Green office space construction is set to emerge as a promising new
commercial construction market, particularly in central London as and when
companies ask staff to return from home to work at their premises.
A new report from agents JLL, The Impact of Sustainability on Value has shown that
so-called “sustainable office buildings” which help firms meet their carbon
targets are proving attractive to investors thanks to the higher rents and
strong leasing which they achieve.
It suggests that a new wave of Green office construction and refurbishment
will be needed to meet demand for at least 8 million sq ft of highly
sustainable, net zero carbon space across central London by 2030.
JLL’s research found that new Grade A office buildings in central London and
with a BREEAM rating of ‘very good or higher’ achieved higher rents; the
average rental premium over non-rated buildings over the last three years was
around 8%.
Sophie Walker, UK head of sustainability at JLL, said: “Clearly the urgency
to build and redevelop these offices in central London to support corporate
environmental and people goals is only speeding up. The first developers to
undertake the task will reap the rewards of high levels of demand and the
intrinsic higher performance of their product.”
Glenigan Construction data shows that developers in London are already
seeking to meet high levels of sustainability on major new office and
refurbishment projects in the capital.
For example, Land Securities’ £13.1 million Nova Place office and retail
scheme in Victoria has been designed to achieve a BREEAM Excellent rating. Work
on the scheme, which also includes a 1 400 sq m library, is due to start this
summer and continue for 14 months (Glenigan Project ID: 19016209).
Similarly, the £57.6 million Skanska UK Building at Featherstone Street in
the City, where work started last autumn, has also been designed to achieve an
BREEAM Excellent rating (Glenigan Project ID: 15273575).
One major office refurbishment and extension scheme in the City, the £40
million Tower Bridge Court development, has also been designed to achieve a
BREEAM Excellent rating. Work on the scheme is due to start this summer and
continue for 23 months (Glenigan Project ID: 19268279).
The highest levels of sustainability are also featuring on other types of
commercial projects in the capital. The £25 million citizenM Hotel Victoria,
where tenders have recently been returned, is designed to achieve a BREEAM
Outstanding rating; the most demanding performance category for sustainability,
met by just 1% of buildings. Work is set to start later this spring and
continue for 12 months (Glenigan Project ID: 15250788).
Glenigan data suggest that contractors with specialisms in the construction
of sustainable buildings could also find good opportunities in the education
sector.
The new £7 million extension to The City University in Islington, where the
contract has recently been awarded and work is due to start this summer, has
recently been designed to achieve a BREEAM Oustanding rating (Glenigan Project
ID: 19131083).
Similarly, the new £18.75 million University School Buildings at Lancaster
University, where work is continuing, have also been designed to an Outstanding
BREEAM rating (Glenigan Project ID: 15178194).
Among new schools, the £6.83 million Salmon’s Brook Special Free School in
Enfield where construction is due to start this summer has also been designed
to an Outstanding BREEAM rating (Glenigan Project ID: 19429358).
