Our free access period ends on the 18th April 2022. To find out about membership to Sustain RE, please contact us.

Brown to green drives London office development

22nd November 2023

Sustainability-driven refurbishments are driving office development in London, according to Deloitte.

The professional services firm’s latest London office crane survey found there are 124 office schemes under construction, totalling 15 million sq ft of space. The UK capital has seen the highest volume of new office starts on record, with 5.1 million sq ft of new construction starting across 43 schemes since the spring. Refurbishment projects account for 3.3 million sq ft in 34 schemes.

The increase in refurbishments has been driven by the anticipated tightening of Minimum Energy Efficiency Standard (MEES) regulations and occupier demands for space which matches their own sustainability commitments and aspirations, said Deloitte. 

The UK government intends that all commercial buildings must have an energy performance certificate rating of C or better by 2027 and B by 2030. Owners will not be able to lease out buildings which do not meet the standards or do not have an exemption.

Philip Parnell, partner and real estate valuation lead at Deloitte, said: “Occupier focus on premium space, coupled with addressing the anticipated MEES deadline and drive to net zero, is continuing to provide a strong stimulus to refurbishment activity. This is a trend that is countering the backdrop of an otherwise challenging macro-economic environment.”

London developers told the survey they expect achieve operational net zero across their portfolios by 2040. However, they highlighted the cost of construction as the biggest obstacle to achieving net zero. 

Share this article