The property industry has just begun to notice the sheer unrestrained waste of speculative fit-outs. But what are they going to do about it? Katie Puckett unravels the madness
Skips full of plasterboard and carpet tiles are a common sight on the streets of Britain鈥檚 cities, contributing to the 90 million tonnes of construction waste produced each year. That the industry is responsible for 20% of the total UK landfill load is bad enough, but what鈥檚 worse is that on closer inspection, those discarded materials are often brand new remnants of office fit-outs, scrapped after a handful of people have seen them.
The received wisdom in the property world is that tenants won鈥檛 take space in a building without a basic 鈥渃ategory A鈥 fit-out to show them how it could look with carpets and suspended ceilings. But as soon as they鈥檝e taken the space, it鈥檚 not unusual for the occupants to start again from scratch, sending vast quantities of pristine materials to landfill.
There are no figures for how much this refurbishment contributes to the construction waste mountain, but as a rough estimate, an average spend of 拢75 per ft2 across 1000 ft2 uses 278 ceiling tiles, 278 raised floor tiles, 400 carpet tiles, 25 light fittings and 10 floor boxes, to say nothing of ductwork, doors, partitions, blinds, tea points and toilets. Everyone in the offices sector has been aware of this waste in time, money and resources for a while, but with sustainability now topping the industry鈥檚 to-do list, the momentum is there to put an end to it.
鈥淚f something can be done to reduce the unnecessary stripping out of category A fit-outs, that would be a big step in reducing the waste of materials,鈥 says Richard Kauntze, chief executive of the British Council for Offices (BCO). 鈥淭he degree of waste is huge and the potential to reduce that is enormous.鈥
The BCO launched a guide to sustainability best practice in November, and although the category A fit-out debate wasn鈥檛 included, questions were raised about it at the launch. As a result, Kauntze says it will be a top priority for the BCO in 2007.
He remembers the last time the issue bubbled to the surface in the late 1980s, before the recession derailed attempts to challenge the market. This time, however, the green agenda is not going away. 鈥淐ost was the overriding reason then. Conservation of materials and energy were fringe issues 鈥 now they鈥檙e absolutely mainstream,鈥 he says.
Riccardo Rizzi, head of environment at fit-out specialist Overbury, agrees. 鈥淭he debate鈥檚 been won. People have been talking about sustainability for the past couple of years, but 2007 is going to be about action.鈥
The biggest hurdle, Rizzi says, is getting everyone to agree. 鈥淚t鈥檚 amazing how defensive people are. They say 鈥榳e do it this way because we鈥檙e forced to鈥 or 鈥榯his is the way it鈥檚 always been done鈥.鈥
Shell-and-core or category A?
Doing it differently means one of two things 鈥 developers not putting a 鈥渄ummy鈥 fit-out in to begin with, or occupiers making do with what鈥檚 there.
So, does it really make a difference to occupiers whether an office has concrete floors or carpet tiles if they鈥檙e going to refit it anyway? It depends which occupier you鈥檙e talking about. Large corporate firms with experienced property teams say they would rather have a building from the shell-and-core stage, with an allowance to do the category A works themselves, typically 拢35-40/ft2 in the City.
It鈥檚 amazing how defensive people are. They say 鈥榳e do it this way because we鈥檙e forced to鈥 or 鈥榯his is the way it鈥檚 always been done鈥
Riccardo Rizzi, Overbury
Gary Wingrove, head of cost management for bank UBS鈥 properties, says: 鈥淲e don鈥檛 need to be shown what the office would look like. We鈥檇 rather design the whole thing as we need it rather than trying to do it around what鈥檚 there, where inevitably there鈥檚 a waste and we come up with a half-cocked answer.鈥
The debate over category A fit-outs mainly applies to offices that are built speculatively to be let to several tenants. Developers are reluctant to do anything that might narrow the market of potential occupiers.
鈥淟easing agents will always say that a clean, open floorplan finished to category A has improved lettability,鈥 says Peter Cole, UK development director at developer Hammerson. 鈥淲hen chief executives walk around a shell-and-core building, it鈥檚 hard for them to visualise the space.鈥
Paul Burgess, head of London leasing at British Land, disagrees: 鈥淭he onus is on us, on the supply side, to demonstrate the benefits better. There鈥檚 a lot more we can do in how we represent the space 鈥 for example using a show floor or better graphics.鈥 He believes that if firms buy space at the shell-and-core stage, they could save 拢10-11/ft2.
But Cole contends that an adaptable category A finish is more sustainable in the medium term than stripping everything down to shell-and-core each time a tenant moves out. He espouses the developer鈥檚 commonly held belief that fit-out firms and occupiers are too ready to start from scratch rather than building on what鈥檚 there.
鈥淭he incoming team need to challenge themselves. It鈥檚 about good design 鈥 not making changes for change鈥檚 sake. Clients should ask themselves whether they really need to take down half the ceiling tiles or put a specialist finish on the boardroom.鈥
鈥淥ften, tenants are encouraged by fit-out designers to start again when it鈥檚 not necessary,鈥 says Gerald Kaye, development director at Helical Bar, which owns property across the UK. 鈥淵ou could keep ceiling tiles to one side while you put up the partitions 鈥 not chuck them in the skip because they鈥檙e not the right shade of white.鈥
But fit-out designers complain that often developers don鈥檛 do the category A fit-outs properly. 鈥淭hey design them knowing they鈥檙e going to be stripped out,鈥 says Overbury鈥檚 Rizzi. 鈥淭he lights they put in, for example, can be really low quality because they know the next person will have bespoke requirements.鈥
Others put the onus on occupiers. When choosing a new office, they should consider a building鈥檚 fit-out requirements as they would its energy efficiency rating, says Andrew Clifford, sustainability team leader at architect Sheppard Robson. He also points out that BREEAM eco-ratings give developers points for omitting carpets but not ceiling tiles. 鈥淪peculatively developed buildings always have a ceiling, which includes the lighting, but it will always be the minimum specification.鈥
The shell-and-core-vs-category-A debate is going to be one of 2007鈥檚 most hotly contested topics in the property world. 鈥淧eople need to think not about fit-out but an intermediate solution that can be adapted in different ways,鈥 says Steve McGuckin, director of projects at Land Securities, before getting to the heart of the problem: 鈥淎t the moment, I鈥檓 not sure anyone鈥檚 looked.鈥
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