The panel was hosted by Nicola Firth, founder and CEO at Knowledge Bank, and consisted of Richard Deacon, managing director of sales at Octane Capital; Raphael Benggio, director of bridging at MT Finance; Mark Marlow, head of sales at Colenko; Gavin Diamond, CEO at Inspired Lending; Clare Grimes, associate director at GRE Capital; Ian Miller-Hawes, sales director at Aspen Bridging; and Michael Fairhurst, commercial director at kennek.

During the discussion, Nicola noted the challenging state of the current market, despite the prevalence of empty office blocks. Given the backdrop of the government’s 300,000 homebuilding target, “you can’t help but feel we’re surrounded by potential,” she said.

Clare noted that she had seen a number of office-to-residential deals come through her door recently, as had Raphael, Mark and Gavin. She emphasised that it was important to gauge the feasibility of these projects.

“I think it’s really tricky. Assets fall into two categories: assets that convert well and assets that don’t,” said Clare.

She noted that certain office characteristics can make conversions into residential units unsuitable, so it is important to be frank from the outset when a conversion is not possible.

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“There's a lot to be said also for keeping assets within their existing use class — just because an office might be vacant doesn't mean it won't be a good office again.”

Richard added that planning was a key factor that must be taken into account, whether an office is being transformed into housing, a hotel, a care home, a pub or any other asset class. There’s also the question of the suitability of the converted asset in the area: “How popular is that end product going to be with the geographical area?”

He noted considerations such as how profitable these schemes may be outside of major cities such as London, Manchester or Birmingham.

This was a sentiment echoed by Ian when talking about office-to-residential conversions. Many of those projects that have landed on his desk are situated in business parks, and he questioned whether that location would ever be suitable or desirable for non-office uses.

Gavin too highlighted that he had dealt with a number of office conversion schemes throughout the year, such as office to HMO and office to student accommodation projects; with the latter he highlighted the need to take into account external factors such as proximity to universities and transport links.

He too emphasised the importance of taking an in-depth view of a project and the asset class of the final product, even if the conversion works themselves have already been given the green light.

“You’ve got to take a lot of different factors into account. Just because somebody gets the planning permission to do something doesn’t necessarily mean it should be a transaction that you’re going to support.”