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Urban Design Compendium


Case Study 119 - Offsetting costs to increase values

119 - Adelaide Wharf, London

At Adelaide Wharf, Hackney, First Base has been working through the London-Wide Initiative, a partnership between English Partnerships (now the Homes and Communities Agency), CLG and the GLA, to deliver a high-quality new urban block next to the Regents Canal. The scheme, designed by Allford Hall Monaghan Morris (AHMM), delivers 147 high-quality, sustainable apartments around a central amenity space, including 50% affordable. Adelaide Wharf makes an important contribution to the regeneration of the local area by raising confidence through quality and by creating an active new street front which helps improve perceived safety in the area.

First Base believes that investing in good design and good designers makes economic sense. Ben Denton, Director of Investment and Management at First Base and a CABE enabler is convinced that any additional costs incurred by employing good designers or additional spending on construction, can be recouped through increased value; ‘Great architects generally cost more than average architects; up to 2% more in fee rates. Design fees are calculated on construction works; construction is generally about 40% of total scheme value. To offset the cost of great design we need about 0.8% increase in values.

‘Architect-designed buildings may cost more to build, however, with a strong client it is possible to restrain the architect to keep costs within 10% above the normal 40% of total development value; therefore, we need to achieve a 4% increase in total development value to offset this additional cost. In total therefore we are looking at 4.8%, rising to 6.5% (to cover profit and oncosts) increase in value required to offset costs.’

Ben believes the costs can easily be met from quicker rates of sales, higher values per m2 and higher overall values per home.  ‘I have no doubt that good design more than pays, but strong leadership is also required so costs are contained.’

Other Information

  • Location: London Borough of Hackney
  • Project Team: Key partners: First Base Ltd, Lend Lease Developer: First Base Ltd Architect: Allford Hall Monaghan Morris
  • Contact: www.adelaidewharf.com

 

UDC2 Section - Delivering Quality and Adding Value 

Increasing values at Adelaide Wharf minimised the need for ‘off the shelf’ solutions and offset the cost of architect-designed buildings.Images (image bank)