Conversion Costs of Office Building

[TownIdiot]

I am just pondering what to do with an office I own. It's now standing empty after the long lease ended last year. There's zero interest in it as an office so I have been looking at a residential conversion and struggling to make the numbers add up.

It's a really very nice building in a popular village and we've looked at a scheme for flats and one for three houses.

On the face of it, it would make a beautiful detached house with decent sized gardens and plenty of off-road parking. If it was built to a decent spec it would somewhere around £1.25 million sales price

At the moment it's structurally sound and has all services in place.

To aid my fag packet calculation how much would I need to budget to convert the interior to a decent spec five bed house? Stripping back would be pretty easy as it's more or less open plan so I'd be looking at stud walls, a proper kitchen, main bathroom and en-suites plus new flooring and decoration.

It's roughly 4300 sq ft useable space.

I'd also need to budget to turn part of the car park into a garden.

Thanks in advance

Edited to add - it's in Cheshire.

[Aluminati]

There’s lots of variables here.

Does it look ‘officy’ ?

Windows, flat roof ? Internally, fairly straightforward, visually ? Less so.

We are currently on a project called Blind Veterans in Brighton, looks like a plane from above. Internally, all students walls with high end fit out.
Externally, every single brick had to be hand painted ( planning) so costs are currently sky rocketing.

Lots of homework to do.

[TownIdiot]

Aluminati said:

There’s lots of variables here.

Does it look ‘officy’ ?

Windows, flat roof ? Internally, fairly straightforward, visually ? Less so.

We are currently on a project called Blind Veterans in Brighton, looks like a plane from above. Internally, all students walls with high end fit out.
Externally, every single brick had to be hand painted ( planning) so costs are currently sky rocketing.

Lots of homework to do.

Externally it's a really very nice building - stone built with pitch roof. Lovely windows, high ceilings etc. Originally built in 1905 and when we took it on the only changes we made were tanking the cellar, adding a few room dividers and air-con, as well as upgrading the heating and electrics.
My wife would happily live in without any changes to the exterior, other than extending the garden - had the tenant agreed to leave when we were moving we'd have seriously considered it ourselves.

Internally we'd need to remove a couple of hideous false ceilings and the aircon.

[Onespeeder]

Not really enough information to provide any useful advice. You will need PP for change of use. Although this may help avoid some of the VAT that would otherwise be payable, I think that you will then have to comply with current Residential Building Regs.

In the absence of any information about the building itself or intended specification, best guess would be £1500/m2 (only estate agents use ft2; construction changed over 50 years ago) with a tolerance of +/- 25% plus any works external to the building. Costs will also depend on procurement route.

This type of project is not risk free and you will minimise that risk with good professional advice, early and comprehensive investigation work and making decisions before starting work - and not changing them.

Crossed with last post.

[Puzzles]

4300sqft but only £1.25m when completed doesn’t sound like a great payback on the face of it.

[TownIdiot]

Onespeeder said:

Not really enough information to provide any useful advice. You will need PP for change of use. Although this may help avoid some of the VAT that would otherwise be payable, I think that you will then have to comply with current Residential Building Regs.

In the absence of any information about the building itself or intended specification, best guess would be £1500/m2 (only estate agents use ft2; construction changed over 50 years ago) with a tolerance of +/- 25% plus any works external to the building. Costs will also depend on procurement route.

This type of project is not risk free and you will minimise that risk with good professional advice, early and comprehensive investigation work and making decisions before starting work - and not changing them

Thanks.
I am at the stage of working with a planning consultant and to put in for the change of use I need to agree what we are going to do with it.
Current options are 3 houses or 5 flats. We would have to comply with residential building regs if we did it this way.
I am kicking around the idea of a single house as I think it will be easier and less costly to convert so whilst the end value may well be less in theory in would be a more straightforward project.

I wouldn't do the project myself, I am just pondering the options as I do some bank holiday admin.

My other option is to just sack it off and just put it out to offers or auction. It's been an excellent investment over the years and even though it doesn't really owe me anything I'd rather not just let it go without a bit more effort.


At £1500/m2 we'd be looking at c.600k. Which is leading me to believe I need to reassess the valuation placed on it!

[TownIdiot]

Puzzles said:

4300sqft but only £1.25m when completed doesn’t sound like a great payback on the face of it.

I agree. It's an old mill village so there are no houses of a similar type to set the market. If it was a couple of miles away it would be double.

[alfabeat]

We own a Grade 2 listed 4 storey building in a market town in South Wales, which has for the last 40 years been used as offices. The last remaining tenant has now retired, and it's been on the market with planning permission for change of use to a private residence. It's a lovely building, but has had zero interest in someone buying it as a private home/flats. The numbers just don't stack up. Being listed doesn't help its cause I'm sure.

We now have an offer from a commercial enterprise wanting it as offices, so it will likely stay as it is.

[TownIdiot]

alfabeat said:

We own a Grade 2 listed 4 storey building in a market town in South Wales, which has for the last 40 years been used as offices. The last remaining tenant has now retired, and it's been on the market with planning permission for change of use to a private residence. It's a lovely building, but has had zero interest in someone buying it as a private home/flats. The numbers just don't stack up. Being listed doesn't help its cause I'm sure.

We now have an offer from a commercial enterprise wanting it as offices, so it will likely stay as it is.

That's interesting as a couple of years ago I bought a listed Georgian building that had been used as an office for 40 years and converted it to our home. Also in a market town but in England.

It was a different prospect though as the layout didn't need changing at all and we could utilise all the existing plumbing and electrics.

There's basically no demand for offices this size round here. Even the tenant who was in there hardly used it. I don't really understand why they kept it on as I'd offered them early termination several times.