6 Key Cost Considerations when considering a Commercial To Residential Conversion which I hope you’ll find useful:

1. Asbestos

Buying an existing commercial building, built in the 60s or 70s, often means that asbestos will be present within the building. Be aware that asbestos will need to be removed prior to any works taking place which can be costly depending on the level of contamination.

2. Overbuild carries different costs

If you’re undertaking an overbuild to add additional stories, this will carry additional cost compared to a conversion. Often the council would like to differentiate the materials of the external envelope and (e.g. zinc cladding) on any overbuild which can be costly. Balconies are normally introduced which require thermal and moisture protection including a durable floor covering and balustrade. Both important points to consider when calculating build budget.

3. Structural strengthening – get tests done before you purchase

Often when you are doing an overbuild on an existing commercial building, there will be a requirement for strengthening to the existing structure. This might also be the case for a typical straightforward commercial to residential conversion. You’ll be adding an additional load, which can mean additional steelwork and costs.

4. Service penetrations – additional strengthening

As office buildings will likely have a centralised service riser in the core, we need to drill holes in the existing upper floor slabs for drainage and services to the newly built apartments. This can sometimes compromise the existing structure which requires careful consideration & possibly additional strengthening which can add costs.

5. Contractors typically won’t absorb the cost/risk of existing building – extent unknown

Contractors won’t absorb the cost and risk of the existing building as the extent and works are often unknown. I’ve found that Contractors won’t carry the risk of any unknown remedial work to the existing structure. I would normally advise the Employer to procure a separate enabling works package to strip out the building so that the main works contractor can try to understand any remedial work or additional work which may be required for the conversion – reducing risk and cost.

6. Façade modifications may mean additional work – repointing

If you are looking at making façade modifications to the existing envelope of a commercial building, which is often the case, the Council like you to visually tie in any new build façade with the existing façade as much as possible, which may mean repointing to match the newly built cavity wall. If a tall building scaffolding is typically required. Consider additional costs and access.