Socially Valuable Property Investment
Daniel Kelso
November 2016
Article
Hands up for social investment
Our aim is to improve the urban-social fabric of the city through design and dialogue. Through architecture we seek to challenge the economically-driven “way things are” and propose new collaborative and citizen-led methods to build and shape our city. We feel that good design, positive public engagement and adding social value are more than ever intrinsically linked with good investment, and should form the basis of a positive investment strategy.
If you're lucky enough to have thoughts about how to add value to the prospects of a tenanted property you own, one of the best ways is to improve or extend the amenity provided by your property. Improving the quality of your offer or adding extra bedrooms for example can help attract more financially secure tenants, longer rental periods, fewer and less severe maintenance issues and ultimately contributes to a higher resale value. Typical routes towards this goal are linear, high in capital expenditure, fraught with bureaucratic permissions processes and often outright hostility from neighbours. Navigating this can be time consuming and expensive but can yield significant benefits especially if you achieve a below market purchase price in an up and coming or well developed and desirable location.
The quality of your architect and their management of the design process to create a lean and simple but effective addition to your building can be crucial in helping mitigate some of the costs associated with this process. However, the siloed nature of the profession often limits an architect’s capacity to effect real change on this situation. At Architecture Unknown we take a different approach to these perennial issues that captures the social externalities of the traditional architectural approach. By prioritising the addition of social value to an area as well as monetary value to a property we have found that the benefits can be self-reinforcing. By recognising the importance of social value, investors/property owners can not only give back to the community they will be profiting from but also increase the yield on their investment. The absolutism of the economics of private property is clearly a contradiction when all investments are rooted in places, times and people. By respecting the varying potentials of these urban actors investment can be better insulated against shocks and damages caused by global economic mismanagement.
Our focus on social issues could be mistaken for utopian idealism but by doing things differently in construction and combining our social investment approach with hi-tech but simple construction solutions we can reduce capital outlay without sacrificing quality. By acknowledging the confluence as opposed to the conflict of a possible community’s desires and development investors can mutually enrich the area and create a profit.
The general attitude read on to understand why this is increasingly counter productive in the modern world
Example:
You invest in a house with potential and space for growth in an up and coming part of Manchester like Wythenshaw which has high potential rental yields. Paying 20% less than the average surrounding asking price you see an opportunity to add value you can’t pass up.
You employ a socially and community based design firm like Architecture Unknown, to help you realise your vision for an “upcycled” and extended home subdivided into self contained flats for young professionals requiring good transport links to the city and the airport but not the stress of actually living within Mancunian Way. You’re keen to reduce costs without affecting quality and are brave enough to consider doing some of the build and renovation yourself. Your architectural designers note that you have an opportunity to connect your build with local youth and employment charities and can give people in need of experience and work a chance in construction under the onsite direction and supervision of your architectural designers.
As part of the planning and design process you engage with the local community and use their experience of the area and appreciation for what their community means to design a contemporary but contextual addition to their area. This focuses on your neighbours to either side who are kept informed and given opportunities to be creative at an early stage when their ideas can best be implemented. As a result the scheme goes smoothly through planning who comment positively on your efforts to integrate and include local charities and people.
As you approach the detailed design phase your architects propose a Modern Method of Manufacture involving a timber framed solution to the new build extension that is based in a simple to construct plywood frame that is cut on a computer controlled machine, thus simplifying the process of construction and removing the need for a main contractor. Using your architect's experience of working with community groups on construction sites you are able to tie the labour and manufacture of new build elements of the design into the local community and reduce costs by cutting out a builder’s labour, overheads and profits. Similarly, by connecting with local community groups you are able to offer youth groups and people looking for ways of upskilling and reentering the job market the opportunity to experience the construction of a building. This goes a long way to giving them the confidence and experience to continue into a full time role in the construction industry and helps lower your costs as this labour is either voluntary for experience or at a basic level of pay.
The speed of construction is improved by the simplicity of the design and the high tech approach to building and is finished in a matter of weeks to the highest of quality all managed on site by your architectural designers. Coming in on time and on budget is one thing but when you look at the positive impact your home improvements have made to the local community it reinforces the positive impact that investment can have on real lives.
We understand that this process may seem a little alien and open to conjecture and possible problems. However in an ever tightening and more socially aware market, looking to new forms of construction and methods of design and construction can open up new markets, and give more scope for positive investment. At Architecture Unknown, we have seen the benefits that taking this approach can have and are fully ready to help with your next project to realise the economic and the social benefits of architecture simultaneously.
