Property redevelopment is a sector which is becoming increasingly appealing to investors.
Old, unused and derelict buildings are given a new lease of life when a developer comes in to transform them into high-quality living spaces.
Redeveloped buildings have the best of both worlds. They have history in their bricks and mortar, as well as having a modern and contemporary interior which makes the most of today’s technology.
This makes these kinds of builds completely unique to any other, and, in a crowded housing market, investors know that renters will pay more for properties that stand out.
So, everyone wins. The community has one less empty building, the market gets the housing it desperately needs and investors get to reap in the rewards.
Still, it’s easy to say that property redevelopments are great, but what are we basing that opinion on? In this article, we’ll be dissecting why redeveloped property is so valuable and what it has to offer to the local community and investors
So, why are property redevelopments so popular?
If you’re going to be investing in property, you want it to generate an income as soon as possible. With cities like Manchester and Liverpool growing rapidly and little to no investment opportunities available on green belt land, existing sites and buildings are becoming more important.
A case study conducted by the Strategic Land Group in 2015 suggested that properties built on brownfield land were almost double the amount built on green belt sites.
Plus, Paul Miner, the planning campaign manager for the Campaign to Protect Rural England says that brownfield sites are roughly developed six months faster than green belt sites.
That means investors are able to see the reward a lot quicker, and luckily there is plenty of opportunity, as the government has suggested it will invest over £2 billion in brownfield regeneration.
So, we know that brownfield sites can deliver redevelopments quicker, but the same can be said of redevelopments in city centres. Unused factories, warehouses and other similar buildings are being turned into much-needed residential properties. How do we know? Well, we just redeveloped one in Manchester.
Investors may be used to spending money based on artists’ impressions and CGIs but there’s no doubt that being able to see what you’re buying into is a bonus.
While new builds only offer a plot of land to look at, property redevelopments can let you walk through the rooms and get a sense of the space. This is important for an investor as it can show the worth of the property from an early point in the redevelopment.
Plus, the property being redeveloped will be known to the local community. With the right advertisement from the developer, this makes generating interest from prospective tenants simple.
This reduces the chance that your property will be left empty on completion. If the building has a history in the community, you’ll likely even be able to set a higher rent than you’d be able to for an equivalent new build.
As we’ve previously mentioned, the properties that the investors will be redeveloping are likely to be old, derelict buildings such as warehouses or factories.
This instantaneously gives these future properties an edge compared to those that are built from scratch. By showcasing the original property’s features in its layout and design, unique living spaces can be created compared to new builds.
After all, who doesn’t want the best of both worlds? Property redevelopments offer the character of an old building with all the modern comforts of a new build.
This is one of the most appealing attributes to an investor. We live in a world where we are dependant on technology, and in the last few years, there has been a great increase in the demand for smart home technology, which can still be used in a redeveloped building.
Having a modern interior typical of a newly built property can contrast greatly with the building’s age. That way, you get a truly contemporary feel of old and new.
By redeveloping an unused building, investors can enjoy knowing that they have contributed towards doing something good for the community.
Even if this doesn’t have a massive impact on your bottom line, everyone likes to have a positive impact, right?
Investing in property redevelopments ensures the character of a community is not lost. Instead, it’s transformed and given the chance to keep making history that would otherwise have never been.
Additionally, by redeveloping a site to the highest standard, the investor will be able to support the housing needs of individuals across a city centre, as well as being sensitive to the surrounding area.
It goes without saying that demand for city centre property is high and space for new developments is low.
Another way of saying it is space is at a premium and new build opportunity is limited. As a result, more and more investors are looking to property redevelopments to allow them to buy in prime locations.
Where a factory was on the outskirts a few decades ago, city centre growth often means it is now in a well-sought location. Therefore, by choosing a redevelopment, you can often ensure you’re buying in a valuable area.
Plus, the style of property developments suits the young professional or student market perfectly. So long as the location your buying in has a strong student population and retention rate, as can be seen in Manchester and Liverpool, you’ll have a ready-made market for your property.
By investing in property redevelopments, you can enjoy all the perks that come with shorter development times, large amounts of character and a great location.
There are likely to be fewer complications and red tape when dealing with a redevelopment project and, at the end of the day, all that means you can make the most of your money.
Even better, redevelopments in city centres provide investors with the perfect opportunity to enjoy the high rental yields of serviced accommodation. If you’d like to learn more about serviced accommodation, download our free Guide.