When property consultancy Knight Frank developed its SKYWARD research project to estimate the scale of the opportunity to build on top of existing buildings, it found that 40,000 homes could be built in central London alone, with 23,000 buildings suitable for rooftop development without impacting on London's skyline. The study which used the latest geospatial mapping software, highlighted that more than 28million square feet of potential additional residential floor area could be developed, with this airspace having a potential value of £51billion. The concept of airspace is very simple. Development of a building upwards can take place on top of existing properties, usually above existing residential or commercial buildings. Modular construction lends itself perfectly to the addition of extra levels of living space craned on top of existing property.
Retailers and supermarkets are also increasingly looking to maximise asset value with an additional layer of living. Sainsbury's has been reported to be developing plans in Whitechapel, Ilford and New Cross Gate with the potential to create 2,500 homes above stores as it the aims to 'improve the efficiency' of its £11billion property estate. Rooftop developments are primed for success in dense urban areas and London is the epicentre of UK airspace developments. Offsite construction methods are a boon due to minimal disruption to neighbouring buildings during installation and the factory controlled quality of modules. Pioneers of airspace developments in the UK has been Apex Airspace who have described airspace as a 'sleeping market'.
The Mayor of London, Sadiq Khan, recently provided a £10million development loan to Apex Airspace, to help roll out airspace developments in the capital and alleviate London's acute demand for more affordable housing. The announcement marked the first time that the Mayor has supported an airspace developer. With London's population expected to grow by one million over the next decade, the latest figures suggest the capital needs 65,000 new homes per year in that timeframe to meet this demand. The funding, which has been granted through the Mayor's Innovation Fund for affordable housing projects, will enable Apex to forge a wider range of partnerships with London's councils, housing associations, and private market freeholders to scale new opportunities in both inner and outer boroughs. "London's housing crisis has been decades in the making, and we need to use every possible opportunity to build more council, social rented, and other genuinely affordable homes," says James Murray, Deputy Mayor for Housing & Residential Development.
"Our £10million loan will help Apex work with councils and housing associations to use their innovative approach of building on existing rooftops, so we can create more of the new genuinely affordable homes that Londoners so desperately need." The price and scarcity of land in London plus the huge competition for available sites has driven new thinking and innovative ways to provide homes and although everyone has different views about how to use that space – 'the key is that it is new space.' "We have invested heavily in airspace development," says Arshad Bhatti, Founder and Chief Executive of Apex Airspace. "Our research shows there is potential for up to 180,000 properties in London alone. This would represent 42% of the need identified by the London Plan, up to 2025."
"It's not surprising that developing airspace is becoming so popular," adds Paul Olliff, Legal Director at Ashfords LLPs' Real Estate Team. "Particularly in London, given the lack of space on the ground and the lack of residential housing, coupled with the advances in construction techniques. The funding authorised by the Mayor of London for such a development shows its rise to prominence on a national and political scale."
The nature of rooftop development can be a complicated process. Not all buildings are suitable for development. It is paramount to ensure the structural integrity of the building plus access routes for cranes. For anyone pursuing this approach there are also a raft of legal issues revolving around existing tenants, leases and building usage. "Early consideration of title is a must," says Tony Dicarlo, Managing Director of rooftop and modular developer Innerspace. "Knowing who the stakeholders of the building are, who the occupiers and leaseholders are, understanding what the leases say and any restrictive covenants. From a developers point of view it's extremely important you need to be aware of who has claim of the airspace above the building."
Certainly the extension of permitted development rights (PDR) to convert offices into residential buildings has provided a boost to airspace developments and for 'upward extensions' to go ahead. As a means of increasing housing output and addressing the crisis in housing supply it makes sense but does it come at a cost? "Airspace development is an area of construction requiring specialist skills, experience and in-depth understanding of the complexities that such developments are laden with," says Aaron Emmett, Managing Director of developer Click Above.
"The need for more homes is acute and where an opportunity to increase the size, or change the purpose, of an existing building occurs, it would appear prudent to do so if it creates no adverse effect. "Whilst utilising offsite construction means that there is relatively little on-site disruption, the fact that the installation process requires significant planning from a logistics perspective means that this simply can't be an area of development that will welcome all-comers. It is also a means of construction firmly rooted in specialist design. An airspace project is heavily design-led from the outset and the manufacturing process only commences once we are sure that the homes have been designed so that people will be proud to live in them."
Every building will have its own unique challenges and it is the developer's job to ascertain whether the cost and complexity of the work is ultimately justified in terms of properties created and income received, both for the developer and the preexisting interested parties. Rooftop developments alone cannot solve London's housing crisis but it can be a key factor in tackling a problem with no end in sight.
For more information visit: www.apexairspace.co.uk www.clickabove.co.uk www.innerspacehomes.com
