Big developers are driving innovation in decarbonisation and helping establish what ‘good’ looks like in the sector, writes Andrew Teacher

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Source: Blackstock Consulting

Andrew Teacher

If the President’s Club scandal was the property industry’s Big Tobacco moment when it comes to diversity and the treatment of women, then Marks & Spencer’s decision to demolish its Oxford Street flagship in favour of a rebuild has drawn a line around the industry’s other elephant in the room: decarbonisation.

With the damp squib of last year’s COP27, and a current environmental policy landscape tangled up in the web of Brexit and self-interest, any reliance on governments to fix the problems we face is likely ill-advised. But given where we are in the property cycle (i.e. at the start of a new one) a greater focus on refurbishment and adaptation is probably no bad thing.

Though some seek to peddle a belief to the contrary, most of us know that a 1.5°C decrease in global temperatures on pre-industrial levels by 2050 is unachievable at best, and utterly misleading at worst. Regulators are taking note. In recent days, the Advertising Standards Agency has warned advertisers against misleading green claims, with a general anti-greenwashing rule likely imminent.

For a variety of reasons, the industry does not have the best reputation

But even if these targets are met, a measure of adaptation – particularly in urban areas, which are more likely to be hit by extreme weather, high levels of heat, drought, and flooding risk – will be critical, not just for business, but for human life itself.

If this is starting to sound a little bit like a Kim Stanley Robinson novel (I highly recommend his latest series, Science in the Capital), then let’s circle back to the built environment in Britain in the here and now. As is ever the case with modern debate, any sense of nuance in how architects and developers should approach the decision about when to demolish a building or refurbish is hard to come by. We risk a return to the days of the confusion of the Merton Rule if we don’t come to an industry consensus on what net zero means in a real estate context.

For a variety of reasons, the industry does not have the best reputation. And with offices emptier than ever before thanks to the homeworking revolution, and town centres on their knees due to a blend of demographic changes, e-commerce, myopic policy, business rates, and the mass overexpansion of retail (with agents arguably to blame), there has never been such a great supply of building stock to re-purpose.

If the outcome of all of this is a building that people don’t want to occupy, there is simply no point

But as the Marks & Spencer debate reveals, it’s not quite as simple as branding everybody that wants to demolish a building as the devil incarnate. As global architecture firm Perkins+Will’s sustainability director Asif Din explained in our conversation on this very subject last year, “the other side of sustainability is a building’s resilience. If you’re going to invest in a building, you want to know you’re investing for the long term”.

And it’s true - the idea that you get a free pass to emit as much carbon as you like once you’ve finished a refurbishment is obviously nonsense. This is particularly so for heavy refits that require going right back to the core, making structural changes or taking big chunks out of the building to remove areas no longer needed. If the outcome of all of this is a building that people don’t want to occupy, there is simply no point.

This was highlighted by revelations last year that local authorities are pursuing de facto “retrofit-only” planning policies. None would deny that the intentions are in the right place. But as industry titans have warned, it it’s an approach that could simply leave us with ever more stranded assets.

So, who should people be looking to?

Equally, though, experts believe that new builds are operated to only about two thirds’ efficiency. This means that if every new building was operated to the level it was designed for, the equivalent carbon savings would remove all cars from the roads across the United States, according to the founder of PassiveLogic, an AI start-up that has recently partnered with tech multinational NVIDIA.

So, who should people be looking to? While in the tech world, it is the minnows who seem to have created the most disruption over the last two decades, in real estate, the giants have risen to the fore as the leading innovators, racking up a series of sustainability firsts with their recent developments.

Designed by Piercy&Company in consultation with Bryden Wood, Landsec’s office scheme The Forge hit the industry headlines as the first to be built using its platform design for manufacture and construction (P-DfMA) method, with the benefits of offsite construction no secret at this point. But Landsec is also looking beyond embodied carbon - its Carbon Manifesto commits it to reducing operational carbon by 70% by 2030, with the company having already delivered a 52% reduction.

The leading companies are also pushing the envelope when it comes to refurbishments

For Helical, meanwhile, its newbuild JJ Mack Building in Farringdon, designed by architects Lifschutz Davidson Sandilands, was the first in the country assessed as BREEAM Outstanding. The self-described sustainable REIT is no stranger to green features, with its colourful PLP-designed Kaleidoscope building’s timber entirely derived from environmentally friendly sources. Like Landsec, it too has set out its vision for the future, having targeted a 15% improvement on LETI targets for emissions embedded in building materials.

The leading companies are also pushing the envelope when it comes to refurbishments. At British Land’s Triton Square, the refurbishment of a 1990s-era building achieved 45% carbon savings by reusing building materials, including 35,000 tonnes of concrete and 1,900 tonnes of steel. Following the example of Olympic cyclists, the site’s engineer Arup took a marginal gains approach to further improvements.

GPE’s London schemes, meanwhile, evidence that good redevelopment should also envisage buildings as stores of materials for future use. Its 2 Aldermanbury Square office scheme with Allies and Morrison saw 700 tonnes of steel from the existing building repurposed towards another of its projects, and the rest to the wider construction industry, with resulting savings in embodied carbon. Notably, GPE’s scheme is hardly short of demand, managing to pre-let all the development’s space against the tide of wider trends.

All efforts to improve the sustainability of our built environment requires some initial sacrifice, but there’s no reason to waste them on half-empty buildings

These industry leaders are likely to shape what good looks like for the forseeable future, and the competition between them is healthy and drives innovation. But ultimately, whether to build from scratch or refurbish is a matter arguably too much open for debate at this point. Any decision on refurbish or redevelop must be underscored not only by measurements of what will guarantee the building’s sustainability in the long term, but by what will drive demand.

All efforts to improve the sustainability of our built environment requires some initial sacrifice, but there’s no reason to waste them on half-empty buildings. We mustn’t overlook the need to reach agreement on how we retain the buildings that have longevity and those that have served out their useful lifetime.