Property sector calls for ‘Retrofit first, not retrofit only’ approach in collective drive to reduce building emissions

The London Property Alliance (“LPA”), which represents London’s leading real estate developers and investors, has called for urgent action from Government to clarify national policy on the retrofitting and redevelopment of commercial buildings as the capital races to decarbonise its built environment and achieve net-zero by 2030. 

A new report, ‘Retrofit First, Not Retrofit Only’, which has been sent to Michael Gove, Secretary of State for Levelling Up, Housing and Communities, warns that a presumption against redevelopment and a default position of ‘retrofit only’ is not consistent with national planning policy and the current London Plan and will undermine collective efforts to decarbonise commercial buildings.

It is also feared that uncertainty around ‘retrofit only’ and inconsistent approaches to development and refurbishment could hamper economic growth. It is estimated that the commercial property sector directly or indirectly supports almost 2.5m jobs in the UK, the equivalent of 1 in every 13, comprises 7% of the UK’s GDP and contributes over £40bn to the Treasury in taxes every year.

The paper includes detailed studies of projects undertaken in London to futureproof commercial buildings, produced in partnership with JLL and with input from a number of leading developers and property owners. It finds that retrofit is not always feasible for some older, poorly designed buildings, and may fail to leverage the benefits of reducing emissions generated by its use over the longer term (Whole Life Carbon).

It recommends projects need to be approached on a case-by-case, holistic basis, taking into account of Whole Life Carbon, as well as the adaptability of a specific building.  The reports warns that a ‘de facto ban’ on any redevelopment would lead to some buildings becoming unlettable “stranded assets” due to the complexity and cost of refurbishment in order to meet the high standards of office space demanded by employees to support productivity, health and wellbeing, as well as the Government’s Minimum Energy Efficiency Standards.  

The LPA outlines that the National Planning Policy Framework (NPPF) contains little guidance for local authorities on how to examine the relative merits of retrofit and redevelopment, including how to assess Whole Life Carbon, leading to a fragmented approach across the UK. It is calling for amends to national planning and building policy, including changes to the Building Regulations 2010, clarifying the use of Whole Life Carbon to standardise and depoliticise the issue. Such a move would create greater certainty and provide the right environment for businesses to continue to invest and drive economic growth.

LPA is also calling for the Government to provide additional funding for planning departments to upskill and invest in environmental expertise with London councils alone facing a £700m budget shortfall for the next financial year.

Charles Begley, Chief Executive, London Property Alliance, said: “Tackling climate change has rightly risen to the top of the political agenda. The property sector is unequivocally behind a retrofit-first approach and is rapidly innovating to reduce both embodied and operational carbon.

“However, a combination of gaps in national policy, under resourced planning departments, lack of expertise, and an increasing presumption of ‘retrofit-only’ in decision-making risks undermining collective efforts to decarbonise our built environment. Without greater support and clarity nationally, local efforts to tackle climate change will fail to deliver the cleaner, greener economy the country needs.”

Recommendations in ‘Retrofit First, Not Retrofit Only: A focus on the retrofit and redevelopment of 20^th century buildings’ include:

1.     Local authorities in London and across the UK should consistently promote a ‘retrofit first’ rather than ‘retrofit only’ approach, and provide more support for sustainable redevelopment of buildings where it can be demonstrated that deep retrofit is not viable.

2.     The National Planning Policy Framework should be updated to include clear guidance for all local authorities on how to assess the relative merits of retrofit and redevelopment.  A national approach to Net Zero Carbon and Whole Life Carbon Assessments, with the presumption in favour of sustainable development and its support for growth, innovation and improved productivity should be adopted.  

3.     Allow flexibility for decision-making on a case-by-case basis to deliver buildings that will maintain Net Zero Carbon status for operational and embodied carbon and sustain both their community and commercial value in the long-term, whilst contributing to other desirable socio-economic and environmental outcomes.

4.     There must be robust and consistent guidance on how Whole Life Carbon Assessments should be undertaken in order to create reliable data on environmental performance of both retrofit and redevelopment projects. Amendments to the Building Regulations 2010 to require the use of and standardise Whole Life Carbon Assessments would provide certainty and depoliticise the issue.

5.     Additional funding for planning departments is needed to ensure planning applications are appropriately assessed in terms of their environmental credentials.

Kirsty Draper, Head of Sustainability for UK Agency, JLL, and co-author of the report, commented: “There is a narrow and fast-closing window to reduce emissions from the built environment. At both national and London levels, political appetite for change is increasing, but there are challenges around determining the most sustainable approach due to the complex interaction between issues such as net zero carbon, community and heritage policy.  Our analysis underlines that retrofit should always be explored in the first instance and that the delivery of net-zero buildings must be explored on a case-by-case basis, with policy that allows for the redevelopment of net zero carbon buildings where retrofit is not feasible.”