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Sustainable procurement vs. supply chain risks

We are all too aware of the great risks facing construction projects today, but our industry is less aware of the more sustainable procurement solutions which could address them.

The nature of global supply chains can mean fluctuations in costs, project delays and inconsistent scrutiny on material provenance. The latter point has risen quickly up the agenda, considering high level ESG commitments which require developers and building owners to understand their carbon emissions and wider impacts beyond their site or asset.

Collaborative and measured approaches to material procurement can mitigate those risks.

In a recent article for Construction News, TFT Partner and Head of ESG Mat Lown wrote about new and better approaches to sustainable procurement which manage the carbon and financial risks faced by the construction industry.

More resourceful, sustainable approaches include considered design and material re-use. All require a realistic ‘whole life’ view of building products, such as:

Collaborate across projects and programmes

Procuring materials and reusing materials across a range of construction or demolition projects is a clear route to efficient and sustainable development. It hinges on a holistic approach to project and programme management.

A great example is Grosvenor’s Holbein Gardens, a redevelopment and one-storey extension of a 1980s office building off Sloane Square in London. It is one of the first projects in the UK to reuse steel salvaged directly from a demolition site, reducing embodied carbon and contributing to the growth of the second-hand materials market in our industry.

Addressing the environmental, social and governance agenda means that our teams are working more closely with contractors and material providers than ever before. We are seeing more interest in long-term contracts encompassing maintenance, upgrade and reuse of products during their lifespan.

Find out more about programme management.

Invest in your future supply chain

Leading developers and owners are taking a financial stake in key materials and suppliers to allow closer control over future supply chain issues. It means they can oversee production as well as the installation of materials.

Legal & General’s investment in modular-homes production is one example. The company now operates a dedicated 550,000-square-foot factory near Leeds, which can produce up to 3,500 properties per year. It demonstrates how businesses in our sector can take inspiration from other industries – such as aviation and automotive manufacturing – to supply much-needed homes in more efficient and sustainable ways.

Making these investments work is another challenge for collaboration. Getting the right specialist input to set up and monitor the success of production is critical.

Lay the groundwork for material re-use and smarter specifications

More prescriptive and accurate material specification means a higher quality product with less waste throughout an asset’s life. It’s easier said than done, but the work begins with effective collection and maintenance of building data. If building owners own a useful asset register that encompasses all the materials across their portfolio – with details of their state and potential for reuse – they can make more informed decisions about procurement and maintenance for sustainable use.

‘Materials passports’ offer a means of cataloguing the properties of a product or material, and Building Information Modelling (BIM) is the obvious channel for holding that information. Initially, such a model supports accurate specification and installation, then it informs future building maintenance work and subsequently the re-use opportunities for building materials or products in future schemes.

However, as with many technologies, such models can only succeed if a project team sets it up correctly from the outset and an occupier or owner team maintains it over time.

Are you looking for new opportunities to get more value from your buildings and development projects?

The approaches we describe here each require varying levels of commitment. But for those willing to adopt them, commercial benefits will follow.

Materials are fast becoming an ‘alternative’ commodity in the development process. They add to the commercial real estate equation of building value vs investment.

Are you looking for new opportunities to get more value from your buildings and development projects? Our teams can help you understand the scope for material re-use and plan for more sustainable built asset management. Together, we can help to lessen supply chain pressures and offer alternative solutions to meet demand for materials, helping to build resilience against future crises.

Want to find out more?

Contact Mat Lown, our Head of ESG and Sustainability services, here.

Contact David Medcraft, our Head of Development Management services, here.

TFT works with BPF on Net Zero Carbon research

TFT has joined the British Property Federation‘s (BPF) Net Zero Carbon research project to investigate the barriers to decarbonisation in real estate, and solutions to overcome them.

The initiative will address the challenges faced by the real estate industry as it recognises the need to decarbonise but has taken limited action to achieve it. New political measures, fiscal incentives, procurement rules and more could be part of the solution. As TFT found in our Redefining Building Performance research: many building owners, developers and occupiers struggled to close an ‘action gap’ on sustainability. The ‘gap’ refers to the difference between recognising the sustainable potential of a building or portfolio, and fulfilling it. In particular, respondents indicated that measurement proved difficult, and that a lack of collaboration was hindering efforts to take action.

Specific next steps across different specialist roles, building types and even regional areas will vary, but we are sure that cross-industry initiatives are important to drive action for a better impact on the world.

The Net Zero Carbon research project is a joint effort with the BPF and a group of sector specialists. Together we will pursue coordinated action and hope to expand our positive outputs compared to more siloed initiatives.

With buildings responsible for up to 30% of greenhouse gas emissions in the UK, the property sector has a critical role to play in the fight against climate change. If we can focus our collective efforts on the right solutions, we stand the best chance of accelerating the transition to a net zero built environment.

Mat Lown is Vice Chair of the BPF Sustainability Committee, with the remit of establishing best practice in the industry, helping government to produce useful regulation and bringing together the efforts of wider industry groups such as UKGBCCIBSERIBA and RICS.

“The great challenge our industry now faces is the time remaining to achieve net zero carbon. The only way to get there is for us all to work together, to share data and improve modelling at pace. I’m looking forward to undertaking this work with the BPF to find better solutions and work with a wide group of specialists to implement them.”

Mat Lown, Head of ESG at TFT and Vice Chair of the BPF Sustainability Committee

Inclusive buildings, accessible spaces: action and collaboration

We work with leading investors and occupiers to create accessible and inclusive buildings which go beyond current industry standards. In the latest edition of Property Week, TFT Partner Jacqui Allen calls for ambition and action from across the industry to support a wider spectrum of building users, and create more resilient built assets in the process.

TFT’s Redefining Building Performance report found several gaps between strategic aims and short-term action, among developers, investors and occupiers of commercial property. One of these gaps was in understanding and improving the occupant experience. For many of these respondents, measurement was not seen as a priority and planned investment was low for developers and investors, but occupant organisations prize it as a differentiator for future employees and customers.

Our industry is still charting the pathway to full building use. In this climate, building trust and desire to use commercial buildings relies on user focus, including broader support for groups which are typically overlooked when it comes to accessible design and inclusive building facilities.

Accessible and inclusive design can cover visible and non-visible disabilities as well as considerations of personal care arrangements for individuals who need that support. Whether you use buildings as an office occupier, retailer, educational establishment or a public service, encouraging people to use your space to its fullest requires navigating challenges in design and management.

The good news is, there are several approaches to improving this situation. There are specific standards and guides for improving spaces, as well as standards which capture a wider view of the building user experience.

Ultimately, the best solution should be defined with the occupier in question alongside developer and/or owner input to bring it to reality in the best way. We have found this to work well on client projects where long-term and high quality occupants instigate a different approach to raise the bar for their workers, visitors, and other building users. Collaboration which puts those objectives at the heart of a project brief will always deliver the best outcomes over solutions delivered last-minute or as a compromise with other outcomes.

For those without a strategy in place but looking for a place to begin, the wide-ranging WELL Standard is worth investigating. We implement this standard across an array of projects encompassing different building types and client requirements. Within strategic frameworks such as these, there is a range of ‘beyond-compliance’ guidance and standards for more specific elements of a building. Getting more specific, the Changing Places standard for accessible bathrooms, which we have installed in shopping centres such as Guildford’s The Priory, provides more comprehensive support than traditional accessible bathroom facilities.

Read Jacqui’s full article in Property Week, here: https://www.propertyweek.com/legal-and-professional/landlords-must-be-ambitious-in-making-buildings-accessible/5117693.article

Contact Jacqui Allen here.

Green Dilapidations on EG’s Property Podcast

With COP26 underway in Glasgow, Estates Gazette spoke with TFT Technical Partner Jon Rowling about our Green Dilapidations process, explaining how a new approach can create a more sustainable commercial leasing cycle.

Joining us on the EG Property Podcast are Siobhan Cross, real estate dispute resolution partner at Pinsent Masons, and Allan Clark, head of sustainability and facilities compliance at Pinsent Masons.

Together, the panel explains why Green Dilapidations is receiving more interest from occupiers, agents and lawyers. The discussion also highlights next steps to introduce measures for a less wasteful leasing process, and how those tactics work from a legal perspective, an occupier perspective and balance sustainable actions while also navigating commercial business issues.

Tune in to the podcast to find out more about Green Dilapidations, and get in touch with Jon Rowling to see how you can get started with a more sustainable approach to commercial property: https://estatesgazette.podbean.com/e/how-to-make-the-dilapidations-process-greener/

EG Property Podcasts

Redefining Building Performance: CPD programme live!

TFT’s Redefining Building Performance research found property investors, developers and occupiers recognised the importance of sustainable buildings, but showed inconsistent action on achieving them. So we created a programme of CPD sessions which address key areas where we can help turn strategy into reality for more sustainable, valuable and resilient assets.

Over five sessions, we examine key trends and challenges impacting our clients. We apply our expertise across the property lifecycle and take a different view of developments and built assets for a better future built environment.

Come and join one of our upcoming webinars! Just contact Jacky Bell with details of the events you’d like to attend, here: jbell@tftconsultants.com

1. Standard or stranded? A question of building performance

September 22, 9:00 – 10:00am: TFT anticipates an increasingly tiered commercial property market, split along the lines of building performance. In this session, we examine the value of compliance versus beyond-compliance measures for planning, funding and occupation, setting a path for asset resilience to 2030 and beyond.

2. Material evolution: new solutions in a supply chain crisis

September 23: 9:00 – 10:00am: Global supply chain risks are increasing property development costs and reducing their sustainable potential. We will discuss how new collaborative and measured approaches to material procurement can mitigate those risks and realise more commercial opportunities.

3. Building performance: hanging by a data thread

September 24: 9:00 – 10:00am: Realising commercial building opportunities is increasingly a data challenge. Better health and wellbeing, sustainability and flexibility all rely on a thread of data run through building design, development, occupation and transactions. This session demonstrates the value in data and advice for gathering, sharing and using it.

4. Green Dilapidations: creating a sustainable leasing cycle

September 28: 9:00 – 10:00am: The current property leasing cycle generates excess waste, cost and carbon. This session focuses on the role of Green Dilapidations to create a more sustainable model for landlords and tenants.

5. Sustainable due diligence: buying for the future

September 29: 9:00 – 10:00am: When 80% of our future buildings have already been built, investing in their sustainable performance is critical. This session focuses on how funds can better identify and create sustainable assets for investment.

See you there!

Green Dilapidations: more sustainable commercial property leases

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Commercial building owners and occupiers are increasingly looking to fulfil their net zero carbon ambitions with measures beyond more sustainable development and energy performance practices. In particular, the current property leasing cycle and non-sustainable dilapidations processes are generating quantities of waste and carbon, which can be mitigated with a more sustainable approach: Green Dilapidations.

TFT’s Green Dilapidations services are designed to help clients reduce the additional material, resources and cost associated with repeatedly fitting out and stripping out commercial property spaces over their lifetime. Taking a long-term view of tenancy, occupier and market requirements, we help our clients benefit from a more efficient, sustainable dilapidations process for both landlord and tenant.

Our support is rooted in facilitating better collaboration between stakeholders. That means the landlord and tenant of course, but also agents and the wider supply chain. Our sustainable building knowledge, commercial understanding and dilapidations expertise helps to formalise a better system as a whole.

We see a greater appetite from our landlord and tenant clients to adopt Green Dilapidations services. A notable occupier client is one of the leading property litigation practices, who we are helping to exit their existing offices in this way. Our recent seminar on green dilapidations in June was well attended by a cross-section of the industry, showing the breadth of interest for specialist advice on the subject.

It’s not just for offices either, and can be used for retail, industrial and other commercial property sectors.

We’re here to help you do dilapidations in a better way. Get in touch with Jon Rowling to discuss how our dilapidations and sustainability expertise can help reduce the carbon impacts of your property lifecycle.

Download our brief service outline here.

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Introducing: Redefining Building Performance

In our inaugural Redefining Building Performance report we explore the drivers of value and resilience for commercial property today, and in the near future. Our findings come from our hands-on experience across the development and property lifecycle, and from key decision-makers among property investors (owner, occupier and developer organisations) who outline the challenges and priorities facing them.

Buildings are at risk. They are built to last, and their reinvention comes at great costs. Still, the world changes constantly around them. In 2020 we began researching the long-term trends arising from our work, so we could help our clients address them today. Then Covid-19 happened, and many of those trends accelerated and became more focussed. On some fronts, the horizon for change jumped even closer.

Redefining Building Performance is about looking at the near future through the lens of value and resilience, establishing what will drive the commercial performance of buildings in the years to come. Our findings and suggestions focus on three key metrics for performance: health and wellbeing, sustainability and flexibility of buildings. These objectives are evident in today’s commercial property market and are influencing the decisions of our clients. However, there is a gap between ambition and action. When it comes to achieving higher standards against those goals, better measurement and collaboration serve as key facilitators for turning good strategy into tangible outcomes.

Within our report we find that each of these themes are widely recognised, but not consistently understood. Despite a sense of general familiarity, these ‘action gaps’ in our industry threaten long-term building value and resilience.

As we shine our spotlight on these issues, we consider the relationship between the investor, developer and occupier. One clear trend is that occupiers tend to lead the way, demanding higher standards of delivery from their buildings because their staff, customers or other building users demand the same of them. However, investors and developers aren’t entirely behind the curve and without their innovation, occupiers may not know how and where to push the boundaries. Within our report, you’ll see examples of leading investors and developers implementing features of these themes on their projects or within their organisations.

We work with those at the cutting edge and those which are catching up, and we are certain that our greatest industry challenges demand constant progression from both ends of the spectrum. By the nature of a changing world, there is no final or perfect outcome (or at least, not for long).

As a consultancy with roles across the property lifecycle from development to management, occupation, maintenance and through transactions, we are well-placed to see how those standards are met, and to advocate and implement more ambitious action through our services. That could include challenging developers to create more adaptable spaces, helping building owners structure their leases to reduce waste, or putting wellbeing and sustainability analysis at the heart of building transactions – and much more besides.

Discussion and collaboration is integral to our success, and the success of our clients too. I hope that as you explore the themes and findings we raise here, you’ll be in touch with any questions about how we can apply this thinking to your next project.

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