Retro first, last and always?

For a decade or more the redevelopment of London’s social housing estates has been a flashpoint. Councillors have lost their seats and council leaders have been deposed. Plans have been challenged in court, in council chambers and on the streets.

Boroughs have pushed forward redevelopment schemes, often in partnership with private developers, as a way of meeting housing targets and avoiding the huge repair bills that have accrued for older post-war estates. Campaigners have countered that demolition and rebuilding disrupts communities, can displace residents and replaces social rented homes with unaffordable intermediate and market housing.

Underpinning these debates are deep-seated issues about community and mobility, trust in public authorities, the roles of public and private capital, and what sort of housing London needs to offer its growing population.

Now, another ingredient can be added to this volatile mix: an increasing focus on embodied carbon generated by the energy-intensive production of materials such as steel and concrete suggests that retaining older buildings may be more environmentally as well as socially sustainable.

The issue is not binary. In some cases, particularly over the longer term, demolition and replacement with a building that uses less energy may make more sense than spending substantial sums on retrofit , even when embodied carbon is taken into account.

But thinking about embodied carbon tends to tilt the balance towards retrofit. At COP26 in November architects, property and construction firms signed a pledge to reduce embodied as well as operational emissions. A campaign led by the Architects’ Journal is championing retrofit and reuse.

So, if retrofit makes sense for people and planet, why are demolitions still taking place? Discounting the possibility that London boroughs actively want to inconvenience and displace their citizens (an accusation that has been levelled at some in the past), I believe that housing targets, financial incentives and complexity work together to push councils towards demolition and redevelopment.

Firstly, demolition makes it more straightforward to increase housing numbers in response to London’s persistent housing crisis and tough housing targets: even if Covid slows or reverses population growth, the capital has a backlog of need and a yawning affordability gap. As big “brownfield” sites become scarcer, boroughs and housebuilders are searching for ways to build more within the capital’s already built-up areas – hence sporadic eruptions of tower blocks across the city. Building denser in privately owned streets is part of the answer, but large post-war housing estates offer the advantage of single ownership, even when this has been eroded by right-to-buy.

Many post-war estates currently under threat are also relatively low rise (though not that low density) by today’s standards. Last week, the redevelopment of Central Hill, a widely-celebrated low-rise 1960s estate designed by Lambeth borough architects Rosemary Stjernstedt and Ted Hollamby, took a step forward when Homes for Lambeth (a council-owned development company) announced a shortlist of firms to prepare a masterplan.

Assessing options for Central Hill in 2017, Lambeth estimated that redevelopment could add more than 500 homes to the 456 already on site. Alternative plans prepared by Architects for Social Housing (ASH), who campaign for alternatives to demolition, proposed refurbishing the existing stock and adding 242 new homes through infill and roof extensions – half the number proposed by the borough.

Refurbishing council housing can also be an expensive process, with limited scope for recovering costs. Refurbishment is funded through the ring-fenced Housing Revenue Account, which relies on rents for income. In 2017, Lambeth estimated that refurbishment costs at Central Hill would be £44,000 per socially rented home, compared to a benchmark of £18,000.

Redevelopment has a different business model. It can be undertaken in partnership with a private developer or through an arms-length housing company with more freedom to borrow and the potential to cross-subsidise, enabling social housing to be replaced by building more for market sale or rent. Lambeth aims for its redevelopment of Central Hill to be cost neutral overall, while its assessment of the ASH plan found no potential for cross-subsidy of refurbishment works. The imbalance is worsened by unequal tax treatment: new builds are VAT free while refurbishment is usually charged at the full rate.

And long-term carbon implications of new build compared to refurbishment are rarely quantified or considered. Even where “carbon costs” can be calculated, local authorities do not benefit from any carbon savings achieved. The government’s Social Housing Decarbonisation Fund has been designed to help improve the energy performance of socially rented homes, but even its maximum grant of £16,000 would not close the funding gap that Lambeth estimated for Central Hill.

Lastly, I think there is a complexity challenge. There is a mature market of developers who can enter into joint ventures with local authorities and deliver a programme of “regeneration” (demolition and redevelopment). By taking control of the site, they can manage risks and adjust the pipeline of development to respond to changing market circumstances and viability reviews. A local authority-owned housing company is in broadly the same position.

But a programme of refurbishment and infill is trickier, particularly where substantial structural work is required. As anyone who has had builders at home knows, refurbishment is disruptive, and budgets need flexibility to cope with unexpected costs, which can rise sharply. Managing disruption to tenants, different teams of contractors and the risks of spiralling costs will sit squarely with local authorities, which have seen their planning and development budgets slashed over the past decade.

Decisions on refurbishment and redevelopment are genuinely complex, balancing the needs of existing and possible future residents, and juggling financial priorities and environmental imperatives. However, despite their declarations of “climate emergency” boroughs lack the incentives and many have been stripped of the skills to invest in and add to their existing housing stock, rather than bringing in the bulldozers again and again.

Originally published by OnLondon.

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