Posted at 11:30h
in Apex News
Airspace development converts unused space on rooftops of existing buildings into new homes or spaces. To some, this form of development may seem niche. In fact, the reality is that this new asset class offers real versatility across residential, commercial and mixed-use property sectors and can be replicated in major UK cities, town centres and internationally.
From the outset, selling airspace rights for development generates an immediate return on investment at typically 20-25% of GDV of the new real estate. In addition to the immediate financial gains, investors and freeholders keen to build long-term equity in an asset can look to add considerable value to an existing building through refurbishment and enhancements to the public realm, creating communities that are both economically and socially sustainable.
Our own commissioned research reveals that London has space for up to 180,000 individual airspace homes, with approximately one-third on top of public sector buildings. With the capital suffering from an acute housing shortage, airspace homes, which are modular, can be manufactured almost entirely off-site using the latest construction techniques, to a high quality through its precise processes, and constructed on building rooftops in a matter of days. Furthermore, this does not impinge on greenbelt land that continues to be a concern for many.
However, ensuring airspace developments are architecturally in keeping with the local vernacular is vital to making this concept a success. The focus should not only be on the additional units being installed. Existing residents living below the airspace homes are valued stakeholders in these schemes and offering communal upgrades such as enhancing the existing façade, uplifting the public realm areas and improving communal facilities such as the installation of new lifts and or redesigned entrances is equally important.
The use of modular construction for airspace development can also improve health and safety standards and ensure existing residents feel safer during the installation process. Furthermore, airspace development offers strong green credentials with previous studies citing improved energy efficiency for the entire building of up to 40%. We have seen this first-hand in one of our own schemes in South Hampstead where energy bills are 50-60% lower for all existing residents.
Of course, our rooftops do not just provide homes: airspace development can be used to repurpose retail and public buildings where spaces once used for stock and administration might have become obsolete and are consequently haemorrhaging value. With a real emphasis on building cohesive communities, airspace could also be used to develop safe and well-equipped rooftop community centres and outdoor recreational space.
Airspace development has the potential to unlock a hitherto untapped asset class – which our commissioned research values at £54bn in London alone – without the demolition of any prevailing structures. With a sensible approach that serves the needs of the local community, airspace development is flexible enough to bring financial and experiential value to both asset owners and occupiers alike.
Read more on React News.