Well buildings: The way of the future
"I think one of the issues we face as lawyers is that people often assume that all we’re interested in is the law," says Chris Paul, partner in the Projects & Construction team at Trowers & Hamlins.
"Actually, we’re constantly looking at commercial issues in the sector which might affect the way our clients do business, now and in the future," he says. "Things which are just discretionary at the moment may be the subject of regulation down the track, so we need to be aware of issues across a very broad spectrum."
Stephen Marks, real estate partner, agrees. "There has been a lot of focus on the structure of buildings and on external design features," he says. "But I think we’re finding that thoughts are turning inwards now, to the relationship between man and building. It’s been a long time coming, but it’s a logical progression from the sustainability agenda which has been at the forefront of thinking in the sector for some time."
Everyone in the sector will be familiar with the BREEAM initiative around sustainability, a standard supported by governments, banks and developers, and which has seen 2.2m buildings designed to BREEAM’s exacting standards since its launch in 1990. Similarly, LEED, its US equivalent, also claims to be the most widely used third-party verification for green buildings but they may be less familiar with wellness which Marks feels is the issue of the day, though unlike sustainability there is no accepted measure.
"Wellness keys into a lot of thinking around how health, happiness and mental state in general can be affected by the built environment," Marks explains. "We spend 90% of our time in buildings, it’s very important that people are front-and-centre when thinking about development."
He points out that many large, contemporary developments are already incorporating wellness concepts as part of placemaking initiatives. "Many of the key features of placemaking – accessibility, the nature of the public spaces, the focus on the environmental features of large developments – are supportive of wellness-based thinking," he says.
But neither Marks nor Paul feel the new attention to wellness is likely to spawn a rash of new regulation.
"It’s highly unlikely government is going to legislate around wellness in the immediate future" says Marks. "There just isn’t the political appetite, and I think the industry would see it as unnecessary interference in an area where the market can apply commercial fixes which address the complex issues involved." "But there’s no doubt in my mind that wellness will become a bigger issue for property, and it’s not going away, and that will manifest itself in all kinds of different ways."
"There is a missing link on the design side," says Chris Paul. "Employer requirements don’t yet talk about wellness as a key objective, and the risk is that value engineering can take out many of the features that would improve wellness and employee productivity in the built environment. You need to think about whether your spec meets current needs, and whether at some point down the line if you’re disposing of it, there could be a cost to bring it up to standard."
"So there are issues you need to be thinking about when appointing the consultant team for a new project, or as part of the due diligence on an acquisition," he adds. "From an investor point of view, the issue of wellness may go to disposal value or eventual rentability – it may become something that can’t be ignored."
"One case I can think of related to a landmark tower," says Stephen Marks. "The building was sub-divided to accommodate various tenants, but because this hadn’t been considered during the design and build process, they hadn’t thought to design the air conditioning system to adapt in the event of that rental scenario. The landlord was faced with a huge extra cost just to be able to let the space. Thinking about that kind of thing at the outset is exactly what lawyers can add to a transaction, if we are part of the team at inception rather than just brought in when things go wrong."
Chris Paul agrees. "If we get in at the start, we can look at how the contract documents reflect client objectives – linking the outputs with the latest thinking on energy efficiency, transport etc."
"Yes, it may be looking beyond the existing regulatory minimums, but if it’s not raised at the start, it won’t be considered in design, it won’t be considered in construction and you may end up with a building that isn’t as effective as it could be."
"Given the size of most of these projects, the cost of getting lawyers involved at the kick-off is minimal compared with what you might end up saving, getting in additional rent or in added end-value when you come to dispose of the asset."
"You can look at these things from a risk/compliance point of view, or you can look at them from the point of view of what’s going to benefit my business," he adds. "The notion of benefit resonates better with the businesspeople we deal with, so that’s how we like to approach things."