Buildings in Transition

For most new owners, the purchase itself is just the start of the journey. When the deal is closed, the new owner of the property is free to get started with their future plans for the building – whether that involves putting it into immediate use or converting or renovating it to maximize returns on their investments.

Achieving optimum returns, safely and sustainably

To achieve optimum returns in the exploitation phase, the building must be safe, sustainable and attractive and tailored to the needs of those who occupy and use it. To ensure that this is the case, buildings often undergo periods of change and transition during the exploitation phase – perhaps because the owner wishes to renovate or convert the buildings, or because of legal obligations or a need to improve the building’s energy performance.

Changes may also be made if the needs of the building’s users change over time. For new building owners, the data and findings from the Technical Due Diligence (TDD) inspection are a useful starting point for follow-up checks to get these kinds of modification plans off the ground.

Decrease in prime real estate in top locations

The latest market analyses show that the supply of prime real estate in top locations is dwindling. Instead of focusing on these properties, investors are supplementing their portfolios with buildings that require some degree of work. For investors with long-term plans in particular, these buildings will need to undergo a phase of transition.

Property owners may decide to make improvements to their buildings for any number of reasons:

• To increase tenant satisfaction
• To increase returns
• To maintain or replace installations
• To resolve safety issues (related to construction, technology, fire safety or legionella bacteria, for example)
• To comply with legal requirements, such as legislation relating to energy or asbestos
• To set their property apart in the real estate market
• To convert or repurpose a building
• To achieve higher Green Building labeling

TDD report

Our decision to refer to the Technical Due Diligence as a starting point is a very deliberate one. Our real-life experience has proven that some clients use the TDD report as the sole basis for a multi-year maintenance plan. However, this is not a smart strategy – and doing so increases the level of risk involved in the property purchase.

A TDD inspection is intended as a quick scan. To produce a fully substantiated and effective multi-year maintenance plan, property owners need a much more detailed insight. An in-depth condition assessment is the right way to go about obtaining this information. The TDD report is still an important source of data at this stage, laying solid foundations for the condition assessment.

The specific inspections required as part of a transition process depend on the property owner’s requirements. Often, one or more of the following services form the basis for our partnership:

• Technical building and installation inspection
• Energy performance advice or energy audits
• Advice on opportunities to improve buildings or demolish properties
• Renovation advice
• Sustainability services, such as BREEAM, WELL or EDGE, C2C
• Asbestos or soil testing and decontamination support