Honoring Heritage: Why This Developer Is Committed to Adaptive Reuse Schemes

You wouldn’t build a new car that’s a replica of a classic model. “That would just feel wrong”, said Sascha Lewin, CEO and founder of London development firm W.RE. But when you restore a historic car, there’s a unique feeling of satisfaction.

On a much larger scale, Lewin likens the sentiment to restoring heritage buildings and ushering them into a new era or use. With 20 years of experience in the commercial real estate industry, the developer has dedicated much of his career, and his company’s portfolio, to repurposing historic buildings across London, with a focus on value-add and adaptive reuse schemes.

The projects aren’t always easy, and they can have more challenges and be more expensive than building from the ground up, but the tactic offers myriad benefits. Redeveloping heritage buildings not only upholds the architectural integrity of London’s historic structures, but the practice offers sustainability benefits as well, satisfying an initiative of increasing concern for both owners and occupiers across the industry.

Lewin spoke with LoopNet about his zeal for restoring iconic buildings across London, the existing building features he looks for to create a successful repurposing project and how to overcome the common challenges developers encounter during redevelopment.

Why is redeveloping heritage projects an important initiative for you? What significance and benefit does it have for the commercial real estate market?
There are so many facets … I think first and foremost, there is some amazing building stock out there. You couldn’t build a lot of these buildings in the same way anymore – you could, but you probably couldn’t afford to. They are anchored into the history of the city, and that's what makes the city so exciting. People come to European cities, in part, to see some of these historic buildings, and so they’re attractive to people.

There's a real chance to [convert buildings] in London, and there is great building stock with great history to reposition. I think it’s a privilege to do that. As a business, we are not married to only reusing properties – certain buildings don’t work today. They probably never really worked well and will not work going forward, irrespective of how much money you put into them. They might have very low ceiling heights, which is usually the biggest challenge. But there are ways of dealing with those challenges, and where [reuse] can work, there are great benefits to working with the city’s existing building stock.

There are also obvious sustainability benefits to reusing as the first approach. The industry, as a whole, finally cares more about ESG initiatives, and so does everyone around the real estate industry, whether it's the investors, banks or occupiers, so that's another great reason for repurposing. From a sustainability perspective, refurbishing existing buildings, first and foremost, saves on embodied carbon emissions emitted from construction and building materials. Reusing materials can save 90% of embodied carbon compared to using new materials.

When vetting properties, what features do you look for in a building that you’re considering for redevelopment?
What I look at first in any building is the arrival experience. It’s a complete gut feeling, but if I get to a building and I feel underwhelmed, then I don't want to buy that building. But if I get to a building and I say “wow, this is cool”, then I get excited.

Then it's about the internal volumes of space the building has because that's really what you work with – we call it the bones of the building. With Arding & Hobbs, a Grade II (a building of special interest) department store-to-retail-and-office conversion we’re working on in Clapham Junction, the ground and second floors had these fantastic high volumes. It was hard to see because parts of the space were partitioned off and had displays from the current retailers. But when we looked behind those partitions, we could see wonderful ornate features from floor to ceiling.

Then with any building, we ask if we can bring a modern use into it. If you have the right ceiling heights, then you usually can. Whether it has columns is another important factor, but quite frankly, I think it’s much less worrying to have columns on the floorplate given the way we use offices today. That was a feature from the 1990s when everybody wanted column-free space as much as possible because it was for trading floors, or long desks with lots of people, and the efficiency of space drove the market. Offices are not about the efficiency of space anymore, they’re about creating environments – different environments for connection, individual work, education and more. If there are columns, you can work around them.

Lastly, if there are attractive and historic features, that just adds to the appeal of the building.

What are the most common challenges you encounter when repurposing heritage buildings? How do you navigate those hurdles and find solutions?
Historic building information can be lacking. It's often very difficult to get into the nitty gritty before acquiring the building, and getting structural information dating back over one hundred years is difficult. When you start working on any building – and the older they are the more likely this is to happen – you’ll likely find surprises about the way things were built. That can completely turn your strategy of expanding, modifying the core or applying fire protection completely on its head. So structural investigative works are key and will always bring up the biggest challenges.

Many of the other things we can see beforehand. For example, we can identify the condition of a building façade, and updating it might be expensive, but it’s something we can plan for.

In newer buildings, asbestos is often an issue. You can usually assess it and make a reasonably good guess about the asbestos risk, based on asbestos registers and the era the building was built, and then it just becomes a money question. Structural issues, that are typically harder to foresee, will usually skew the cost much more than asbestos.

What are some of your biggest lessons learned working on these types of projects and what would your advice be to a developer working on their first heritage project?
Working with, and ultimately occupying, a heritage building requires compromises. Spaces are not laid out efficiently. Also, introducing modern services can be hard to combine with the heritage aspects and regulatory requirements (e.g., fire and accessibility) which can be difficult and costly to meet. These compromises need to be outweighed by the history and beauty of the heritage aspect.

Working with heritage buildings is about celebrating the existing and less about creating the new. Take your time to understand the building you are working with. This applies to the historical context as much as to the way the building is constructed and has potentially been reconstructed over time.

How does the cost of these projects compare to building new ones? Do you find it ends up being more or less expensive to restore or adapt a property?
Building new requires a host of other factors. You are putting a lot more material into the building in a new construction project, which you don't have to do with restoration. We've restored warehouses in Shoreditch where we've taken a very paired-back approach, so they were very cost-effectively restored. On the other hand, we just completed a project combining three historic townhomes to create an office building on Grosvenor Street in Mayfair, which had very high-end finishes and was complicated because we had to dig into the basement, so it was very expensive. A lot can depend on how old the building is. So, I don't think you can say that restoring is 20% more or less expensive, for example, than building a new structure. It's really project specific.

People often like to demolish instead of repurpose because you control the risk. That’s attractive because once you demolish the building, you've just got the land and can do ground surveys that give you a pretty good understanding of what you're building on. When you’re starting from scratch, your risk is very limited once the foundation is laid because it’s all pre-planned. The risk is more in your procurement and whether your contractors will go bust, and that risk you’d also have on a refurbishment.

What are some examples of repurposing projects you’re working on now that exemplify some of the concepts we’ve talked about?
We recently finished the refurbishment of three, side-by-side Georgian-era townhomes originally built in the 1720s, into 37,500 square feet of office space. It’s in the heart of Mayfair, so there was a very clear target market for family offices or high-end finance firms.

The project at 75 Grosvenor Street combined the three Grade II homes that each belonged to a different family; it was a complicated and challenging project. When we opened the spaces to try to bring all three homes together, there were a lot of surprises. The homes had been badly developed. We combined them with a modern extension that made it six stories and added five terraces as an amenity.

At the Arding & Hobbs department store conversion, we are creating a 90,000-square-foot mixed-use building with ground-floor retail and office space, due to be completed in autumn 2023. We are still finding surprises in there. Not long ago, we found a vault safe we didn’t know existed when the contractor was already on site. There was a brick wall around it and we had no idea it was there. It’s big enough for one to two people, so we’ve turned it into a phone booth nook for the office, which is quite fun.

Surprises can be part of the fun, and with historic buildings, it’s about working with what you've got and turning it into something better. When you come to projects like 75 Grosvenor or Arding & Hobbs for example, we developed completely modern buildings inside these structures. It’s a very different perspective to determine what you want to build from scratch versus trying to make the best version of what you already have. It's a different approach and challenge to building new, but the satisfaction you get from restoring something is fantastic.

This interview was edited for clarity and brevity.