Howells, in collaboration with NLA, recently hosted a roundtable at our London studio, aimed at addressing viability of workplace retrofit projects. 

Bringing together experts from across the industry including developers, local authorities and consultants, the discussion explored the repositioning of office buildings against a backdrop of tenant demands, policy levers, and the climate emergency. 

The pretext to the discussion was that retrofit plays an essential role in responding to rising demand for office space. London-wide office vacancy fell to 8.3% in 2025, with just 1.3 years’ supply of office space across the UK currently under construction. Simultaneously, emerging legislation will require offices to be upgraded to achieve a minimum EPC B rating by 2030. 

We heard that, whilst London remains a global leader in retrofit legislation and delivery, there are nevertheless significant challenges presented by a febrile economic climate and evolving occupancy trends (ie hybrid working). 

In a conversation framed around viability barriers, rising cost understandably emerged as a major talking point. Rising by 40-50% over the past five years, construction costs have resulted in retrofit schemes approaching parity with wholesale redevelopment. Whilst inflation accounts for part of this, regulatory changes and shifting occupier demands have also contributed. 

Consequently, investors are closely scrutinising whether repositioning existing offices can deliver desirable returns, particularly when faced with the multitude of abnormal risks that are often common when dealing with existing buildings. 

Unknowns often lead to delays and increased costs, placing greater emphasis on early-stage technical due diligence – in particular, upfront investment in detailed building surveys are seen as essential to mitigate greater cost risks later on. 

Whilst the sustainability justification for Retrofit First is clear, and the need to reduce emissions in the construction sector is critical, in many scenarios new remains a more attractive proposition for realising financial returns with greater certainty. This makes innovation by design teams more critical than ever in making retrofit stack up financially. 

Planning policy in London is increasingly supportive of retrofit, with many boroughs embedding retrofit-first approaches. Westminster’s requirement to retain at least 50% of existing structures and the City of London’s mandated optioneering process were highlighted as examples of policymakers embracing retrofit. 

For those developers and investors committed to reusing existing buildings, there is a growing willingness to take pragmatic decisions to maintain viability. 

Whilst there are pipeline retrofit projects delivering best-in-class sustainability accreditations, in other instances developers are accepting a lower accreditation and shifting focus to achieving the maximum value from light-touch interventions. 

Capital expenditure can be managed through a targeted retrofit strategy which improves a building’s environmental performance and amenity spaces whilst maintaining most of the existing building fabric. This approach caters to an emerging tier of occupier looking for good quality but not “best in class” space, with a willingness to compromise on certifications in exchange for a quicker turnaround at more accessible rent levels - while still delivering on character, location and amenities. 

Technically, retrofit solutions are increasingly well understood. The focus is now on proving financial viability and determining the right ‘depth’ of retrofit on a case-by-case basis. This includes detailed component-level cost analysis, deciding strategically where to invest in deeper structural interventions, and recognising the value of programme savings as well as optimising capital expenditure. 

Consultants and developers are learning more all the time, as each project presents different opportunities and challenges, and multiple options can be explored to identify the most expedient design and delivery solutions. Technology and AI are playing an ever-greater role in how these assessments can be made quickly and inform decision making to unlock projects, mitigating delay and abortive costs. 

With an estimated 25,000+ London buildings requiring upgrades to achieve EPC B rating by 2030, retrofit will play a significant role in ensuring the competitiveness of London’s office stock. The challenge now is not whether the industry can deliver retrofit, but how quickly it can demonstrate that doing so makes commercial sense. 

Ultimately, the most successful retrofits may not be the most technically advanced, but those that achieve tangible environmental and occupier benefits whilst remaining viable enough to be delivered.