Is Conversion or New Build best for Residential Development?

When looking at residential development is it best for convert or build from scratch? A recent Building Cost Information Service (BCIS) study looked at the cost per square meter and found that the difference many be nominal. They showed two project examples where the conversion of a townhouse cost £1040 per square meter, whereas a comparable new build came in at £1329 per square meter.

The cost will vary depending on the project but here we look at the different schemes available and what factor to look at during the design phase. Often conversion is not an option, depending on location, cost, requirements and availability.

The Extent of Work

BICS looked at a range of conversions costing from £646 to £1336 per square meter. Some of the schemes included repairs and refurbishment of the building fabric, such as roof windows and stoneworks, whereas others just needed minimal exterior work. All schemes needed the replacement of fixtures, fitting, mechanical and electrical installations as well as redecoration. If any finishes could be retained then this was done where possible to add value to the project.

Architecture

For period conversions the buildings were analysed for any possible renovations of architectural features including windows, fireplaces and decorative plaster work. Any high ceilings and large windows are seen to enhance the internal environment and recognised at this stage. The buildings were also recognised for any external architectural appeal that they may have.

Duration

BCIS calculates that the construction duration of a new build block of flats with a contract value of £450,000 has a contract period of 38 weeks, and a project with and a contract value of £800,000 to have a 44-week period.

If you compare that with two conversion schemes with 22 weeks and 39 weeks a saving of between 10 – 40% can be seen in the time needed on site. The correlates with savings in the design period making properties available to the clients much sooner than new builds.

Costs

As with any building project, problems can always arise. With renovations and conversions there can be unforeseen problems which can bring delays and higher costings. Water damage, faults within the original building may be found hidden behind previous repairs, or discovery of hazardous materials may bring about extra costings. If work is being carried out on a listed building then again this can incur higher costs for any work being carried out.

With new builds there can also be extra costs associated with ground conditions, connecting amenities and road infrastructure.

When comparing external work costs between new builds and conversions, looking at paving, parking and drainage etc., the new builds came out with higher costs. A building conversion saves between 19 – 67% on the comparable external works to those with new build properties.

Benefits

The environmental and community benefits seen with building conversions include all the positives seen with less time on site. There will be less traffic disruptions and disturbance to neighbours, this is heightened in built up locations. If you can retain the already existing buildings then this enhances the environment seen in the local communities.

Looking at all the above factors of Conversion or New Build it will all depend on the individual case and those people who are taking on the project. New Build properties have the advantage of better more modern designs, more eco – friendly and accessible, whereas the conversions may have the upper hand on pricing.

Contact Richard Benwell to discuss any building developments you are considering.