In recent times there has been an increase in interest towards refurbished office spaces rather than new building developments. This has been attributed to the recent downturn in the economy due to financial crisis, which has hampered the growth of new office development projects in London and has stalled the progress of existing ones.
According to the research by UK’s top property consultant group, GVA Grimley, office space refurbishment will soon replace building developments since refurbishment is a cost effective as well as more viable option. It helps to save time, material and building costs as compared to new office spaces. In addition to time and cost, refurbishment also offers high tax return reliefs, especially if the refurbishment project is undertaken in an undeveloped area, thereby promoting its development.
In response to the rising demand for top A grade desk space; there has been an increase in refurbishment projects by landlords and developers. According to the Head of the GVA Grimley’s Leeds office agency, Don Hodge, West Yorkshire has witnessed a sharp rise in Grand A office space. However there is not sufficient supply to support this rising demand. Against a plan to develop 1, 250,000 sq ft of Grade A office space till 2012, only 3,75,000 sq ft is likely to materialise. Also financial crisis has hindered the progress of many large building projects, driving the developers towards refurbishment projects.
Thus with new projects facing a downtrend in the near term and demand for prime office space facing an uptrend, landlords and developers in the UK are being driven towards refurbishment projects to meet the needs of the office space occupiers.
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