Brick & Block: Can there be added value in traditional construction?
Brick has never really gone out of fashion. In fact it now seems more popular than ever. But with little room for manoeuvre on the width of either brick or block, it is a construction method that can quickly eat into commercial floor space, and therefore how much rent can be commanded. So, the question is whether there’s space to gain extra returns by investing in premium insulation?
To put this to the test, Sweett Group looked at a mixed use development in central London. The new, £15.476 million building combines ground floor rental space with five storeys of Cat-A offices. The property was restricted to more or less the same dimensions as its predecessor, with brick being used to complement the surrounding architecture. Within these restraints, the estimated rental value of £683.50/sq.m (£63.50/sq.ft) meant there was a clear incentive to squeeze out every available inch of space.
The study shows that, whilst a partial fill construction using premium performance insulation lifted costs up by £6 per sq.m compared with a full fill mineral fibre option, it also reduced the overall width of the wall construction by 40 mm. When totalled out across the building this worked out at 26.00 sq.m (279.86 sq.ft) of extra usable space, with a capitalised value of £498,603.00. As a result, the additional cost of the premium insulation could be paid back through increased rental income alone within two years.
Planning restraints on either the aesthetic or dimensions of a property are a common challenge, particularly within urban spaces, and with land value and rental rates continuing to skyrocket, there are clear reasons for opting for premium insulation options, especially with a traditional brick and block approach.
The next blog in this series will go live on Tuesday 14th July and will take a look at timber frame construction, with a case study in East Anglia.
If you can’t wait for the series to unfold and want to find out more, visit the real value of space website and download the whitepaper.
Read the whole of the Real Value of Space Blog series.
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