- 1 Minute Read
- 17th April 2013
Office to residential proposal to create 11,500 new homes
Up to 11,500 new homes could come onto the market with government proposals to convert vacant office space into residential apartments, according to new research released by Lambert Smith Hampton, the UK based real estate consultancy.
According to the report, over 7.4m sq ft of unused office space in the UK is suitable for conversion, which if approved, would fulfil 25% of the amount of new homes pledged by the Deputy Prime Minister, Nick Clegg.
32 of the UK’s regional markets were analysed in the study, which found that 27% of the UK’s total regional office availability is obsolete; equating to 11.7m sq ft of office space in the UK market.
London’s office markets yield the biggest rewards, with the divide in its office and residential stock values greater than anywhere else in the UK. The report established however, that there were substantial gains to be made throughout the UK, with residential floor space significantly outperforming secondary and tertiary office values.
LSM identified Birmingham, Edinburgh, Nottingham, Slough and Manchester as the top five UK locations with suitable stock and residential demand, able to yield the greatest opportunity from property to residential schemes.
Speaking on why there is so much obsolete office stock in the UK, National Head of Office Agency, Tony Fisher said: “Modern workplace trends have changed office occupier’s requirements, they need flexible, open plan space and crucially less of it. In the last 20 years, the amount of allocated space per person in an average UK office has halved.
“Office occupier requirements will continue in this vein, meaning any stock that does not meet modern workplace trends is unlikely to ever be let again and while not every obsolete building can be converted a fair proportion could be.”
“In the past getting planning permission to convert an office into residential accommodation could be costly and time consuming. This is no longer the case in England following the government’s recent announcement that they will allow office space to be converted without planning permission.”
The office to residential proposal presented in January 2013 by government planning minister Nick Boyles has been a controversial one with UK industry experts, business leaders and politicians alike voicing their concern over the effects the proposals would have on the market.
In January 2013, developers warned that the move could destabilise the office market and be almost impossible to rectify. With the proposals given the go ahead in England, only time will tell if this will be the case.