Mitigating Office Obsolescence:


This report is the third in a series of guides designed to tackle the issue of office obsolescence. First, it sets out the international scrutiny afforded to office obsolescence in academic literature and practice-based research. It then responds with some practical guidelines on and solutions to office obsolescence alongside an appraisal of the wider socio-economic environment, which must be considered in any office-building change.

There are offices in the UK which are obsolete due to various reasons such as location reasons- the building is in, for example, an inaccessible, out of town location where there is no occupier demand. Some offices can be functionally obsolete as the building is not fit for purpose due to changing technology, new regulation or changing occupier demand, i.e. small, irregular shaped floorplates or cellular design. An office building deemed as physically obsolete means the building’s fabric has deteriorated to the point where the cost of occupation outweighs the benefits accrued by the occupier.

In any response to obsolescence, particularly conversion for new use, it is tempting to focus on the physical aspects of buildings, for example building size, height, depth, structure and servicing arrangements. These factors are certainly important, however our research indicates that the physical building exists within a much wider socio-economic context which influences both the management of the office property and the potential mitigation of its obsolescence. To account for this wider context, a PESTLE analysis was used to scan the contingent environment of office obsolescence. A PESTLE analysis focuses on six key themes namely political, economic, sociological, technological, legal and environmental.

The report also looks at how office landlords and investors can capitalise on the new working environment. Even though office buildings are traditionally designed to last for centuries in the physical sense, they will have multiple tenants and types of use. In the future, office buildings may not be judged only on specification; they should be marketed as a service, rather than as an asset. Under this perspective, investment and management strategies will need to be proactive, with an emphasis on tenant experience. This suggests a change in approach from traditional management strategies based on price signal. Assets may not even be called ‘offices’, but business centres, hubs, communities or hives. What is certain, is that the ability to adapt and change will be a key determinant of success and profit in the future.

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