As temperatures rise, 89,500 commercial conversions could become uninhabitable
Following the relaxation of planning legislation in March, which made it easier to convert commercial buildings into homes, Zurich UK has raised concerns about the potential surge in poorly executed conversions. The insurer warns that if these conversions aren’t done properly, they could lead to homes that are unfit for future climate conditions.
While the summer of 2024 might have felt brief, temperatures across Europe have been alarmingly high, following a trend of increasing maximum temperatures and prolonged warm spells in recent years. This pattern is no anomaly; the Met Office’s “State of the UK Climate” report lists 2022 and 2023 as the warmest years on record, with all of the top ten warmest years since 1884 occurring after 2002.
Government planning data shows that applications to convert commercial offices into residential units in England jumped from 1,025 in 2022 to 1,235 in 2023—a 20% increase. This follows a similar rise between 2020 and 2021, as developers took advantage of pandemic-vacated commercial spaces. These applications cover use class E, which includes offices, banks, restaurants, and shops.
With the government’s commitment to building 1.5 million new homes in the coming years, adding to the UK’s housing stock is clearly a priority. However, while converting unused commercial buildings into homes has its advantages, there are significant concerns about poorly designed conversions. Many of these converted buildings lack adequate ventilation, cooling systems, and external shading, leaving them vulnerable to the increasing frequency of heatwaves and hotter summers in the UK. Furthermore, many commercial buildings are located in densely built-up concrete areas, making them more susceptible to the ‘urban heat island’ effect, where temperatures are higher and the risk of flash floods from heavy downpours is greater.
In addition to the risk of overheating, Zurich UK has seen a high volume of escape-of-water claims stemming from office-to-residential conversions, often due to substandard plumbing or buildings not designed to handle the infrastructure demands of multiple kitchens and bathrooms. Research from University College London (UCL) highlights that these poorly executed conversions disproportionately impact vulnerable people, exacerbating existing inequalities and negatively affecting occupiers’ wellbeing and quality of life.
Research from The Grantham Research Institute on Climate Change and the Environment at LSE shows that half of all UK homes are currently at risk of overheating. Under a 2°C global warming scenario, this could increase to 90% of homes. While building regulations now address the risk of overheating in new builds, they do not cover existing buildings—despite the UK having some of the oldest and most inefficient housing stock in Europe.
The problem goes beyond inefficiency; homes that aren’t resilient to heatwaves pose a significant health risk. The Climate Change Committee estimates that heat-related deaths in the UK could increase by around 250% by the 2050s. Without proper planning and execution, converting commercial spaces into homes could exacerbate this growing crisis.
“As legislation continues to evolve, enabling under-utilised properties to be repurposed to help ease the housing shortage, the number of office-to-residential conversions has continued to rise. “Increasing the UK’s housing stock is vital and understandably high on the government’s agenda, however it’s important that conversions are well-designed and well-built – for example, including cooling features to avoid creating homes that overheat and suffer other issues, such as the escape of water.
As more intense and frequent heatwaves become a dominant feature of the UK’s summertime, developers need to ensure ventilation and shading are considered to create homes that are safe and resilient to our changing climate.” – Paul Redington, Zurich’s Major Loss Property Claims Manager.
“The continuing pre-occupation in the commercial property sector with what are frequently referred to as ‘stranded assets’ – properties that do not meet future regulatory efficiency standards or market expectations – is increasing pressure to find alternative uses for these properties. Government policies and standards on embodied carbon make building adaptation the main route to re-use, and, in a country experiencing a severe housing shortage and increasing residential property values, conversion to residential is an obvious consideration which the Government has facilitated through various regulatory relaxations.
It is important to enable the re-use of buildings no longer needed for their original purpose to a use for which there is a fundamental need, but the buildings need to be fundamentally suitable for such conversions. Additionally, the residential standards applied need to ensure we don’t create problems in the future, especially with increasing temperatures predicted. Natural light and ventilation are just two of the key standards that need to be met but there is one often neglected – direct access to external space such as a balcony. Direct outdoor space will become increasingly important as people grow older and less mobile however for developers relying on ‘Permitted Development Rights’ to convert, this would draw them back into the planning permission regime – something they would probably wish to avoid.” – Tony Mulhall, Senior Specialist in Planning & Development at RICS.
