Forsters advises on Joint Venture between Invesco Real Estate and Marchmont Investment Management
14 March 2025
News
Forsters’ Commercial Real Estate team has advised a new Joint Venture between Invesco Real Estate and Marchmont Investment Management in its first acquisition of a portfolio of industrial and logistics assets in strategic locations across the UK.
The new Space Industrial platform has been established to acquire, manage and re-position multi-let assets with a key focus on ESG-credentials, offering value-add opportunities. It has been seeded with funding provided by Marchmont and Invesco Real Estate Europe Fund III to acquire the portfolio comprising four assets in Milton Keynes, Sheffield, Manchester and Pershore.
Forsters’ role included advising the client on all commercial real estate aspects of the acquisition, including carrying out title and tenancy due diligence, negotiating all contractual documents, co-ordinating tax, construction, planning and real estate disputes where required.
As the first four assets to be acquired by the fund, the work incorporated extensive collaboration with the Jersey trust advisors. Subsequently, the properties have been secured against debt finance, necessitating a financing transaction with the firm’s Banking and Finance team.
Cam Fraser, CIO of Marchmont said “The UK multi let industrial (MLI) market has repriced more rapidly than others, presenting an opportunity for Space Industrial to invest in high-quality, income-producing MLI real estate, promising strong risk-adjusted returns. The venture will target assets between £10m-£100m and will look to provide capital solutions for Industrial Real estate platforms.”
Connected thinking on rooftop solar – Victoria Towers writes for EG
4 March 2024
Views
Victoria Towers, Partner and Co-Head of Industrial and Logistics, has written a piece for EG on the benefits of collective thinking to streamline the legal processes causing delay to rooftop solar.
With time running out for promised legislative change to facilitate rooftop solar, there is much to be achieved in banging a few heads together and streamlining some of the legal processes currently causing delays.
The issue is acute for power-hungry industrial and logistics development, when rooftop solar is often incorporated as part of any planning application and the market is clamouring for fast delivery of new space in the right locations.
It was October, in energy secretary Claire Coutinho’s speech to the Conservative Party conference, promising to reduce red tape for solar panels on industrial rooftops, that she bemoaned solar farms covering our green and pleasant land, and pledged to make it easier for solar panels to be installed on industrial rooftops, warehouses, car parks and factories, cutting through the planning red tape that limits the amount of solar that businesses can currently install.
At the same time, her department’s Solar Taskforce has been looking at barriers to rooftop solar after highlighting the untapped potential of commercial sites, such as warehouses. The task force is due to be wound up around February, and its work will be used for a solar roadmap, to be published later this year.
This time last year, a survey by Forsters found 77% of developers and investors currently used solar panels on industrial and logistics real estate or planned to. The Department for Energy Security and Net Zero should be pushing at an open door.
The government’s own figures show progress in getting photovoltaics on to buildings. An update published in January showed that 50% of capacity came from ground-mounted or stand-alone solar installations at the end of September 2023, but – rather perversely – the majority of the remaining capacity was on domestic buildings, not commercial.
November’s Autumn Statement addressed the issue, promising reform of the grid connection process to cut waiting times, including freeing up more than 100GW of capacity so that renewable energy projects can connect sooner, potentially reducing connection delays from five years to no more than six months.
Co-operation is key
For those of us negotiating these connections for industrial developments, day in and day out, investment is certainly needed. Not only in the grid infrastructure itself but also – much like the challenges around the planning process – in the process of securing a connection. Client projects seem to be held to ransom on substation and wayleave arrangements when they want to connect to the grid.
A question often presents itself when repeatedly agreeing substation leases with providers: why, when dealing again with the same provider, can we not cut through the negotiation and proceed on similar terms? There are a handful of points that are site-specific, but the usual obligations around repair, alterations, use and works in the vicinity of any cabling do not need to be brokered every time. Surely it is better for all those concerned to ensure that the legal documentation is progressed as swiftly and efficiently as possible.
To that end, it does not seem beyond contemplation to have a common ground as a starting point – but standard terms will only work if drafted well. A few years ago, a template wayleave agreement was introduced, but the result was too complicated and everyone quickly broke away from the standard approach. As the pressure increases on all those involved, it seems that we should look at agreeing a succinct, market-appropriate suite of documents that can be called on.
We know that most substation providers have a list of requirements – for example, uncapped indemnities – but many of these are unrealistic and deter investment. Investors don’t like indemnities where they are unnecessary, and quite often facts can allay the concerns that providers have. For instance, an indemnity should not be required on a site that is verified as remediated from an environmental perspective.
Mindset shift
Another frustration comes in the interplay between utility companies. If a gas pipe and an electricity cable are both needed, we would expect some joined-up thinking in using the same route and consulting with each other over installation.
We need more co-operation between independent distribution network operators and distribution network operators. We find ourselves in situations, albeit rare, where we are only permitted to liaise with the IDNO, which in turn has to pick up with the DNO. Alternatively – and again rather confusingly – we liaise with each entity but they do not have any contact with each other. This makes negotiations more protracted and challenging.
There is an interesting legal question here as to whether a potential power user has a right to be connected to the grid. We know the regulatory backdrop, but more and more we are being presented with a “take it or leave it” attitude to negotiations, where the view seems to be that if the end user does not agree to the terms, then the relevant development can be left without power. How has it come to this?
An attitude shift and greater uniformity should not require test cases or legislation. Instead, there should be a focus on working together, taking a sensible approach and not reinventing the wheel every time negotiations are commenced. Strict timelines, set in legislation, would focus minds, but it is hard to imagine a sanction that would not make the situation worse by drawing resources away from investment in grid infrastructure.
Developers are incurring huge costs as a result of delays in getting substations built, signed off and energised. Industrial and logistics development needs to be quick to meet demand – and we need the providers to be more responsive and more reasonable.
The article was originally published on 27 February 2024 and can be read here behind the paywall.
In the third episode of our Outside the Box podcast, we look at sustainability in the Industrial and Logistics sector. Miri Stickland, Forsters’ Head of Knowledge is joined by Victoria Towers, Partner at Forsters and Co-Head of Industrial and Logistics, and Jessica Pilz, Head of Sustainable Investing, Private Markets at Fiera Capital.
With the sector committed to meeting net zero targets by 2050, UK investors and developers have highlighted the need for further assistance from Government. We discuss how recent announcements from Rishi Sunak weakening net zero policies will impact the sector, how pressure is mounting and where meaningful gains can be made.
Forsters acts for Bridges and Wrenbridge on the preletting of three logistics units in Aylesford
27 October 2023
News
The Industrial and Logistics team at Forsters has acted for longstanding clients Wrenbridge and Bridges Fund Management on pre-letting of three units at ‘Click Aylesford’ (as reported in React News). The pre-letting comprises 95,000 sq ft of the 300,000 sq ft scheme, where practical completion is expected in summer 2024.
One of the units has been pre-let to FixFast on a 10-year lease, and the other two units have been pre-let to Headline Filters on a 25-year lease. The development is targeting EPC A+ and BREEAM Excellent ratings. The occupational arrangements are aligned with the Wrenbridge/ Bridges aspiration to develop and operate “some of the UK’s most sustainable industrial buildings”.
A multidisciplinary team (Commercial Real Estate, Construction, Planning and Tax) continues to act on matters relating to the development, having acted on the original acquisition in Autumn 2022.
Victoria Towers, Co-Head of the Industrial and Logistics group, said: “We are delighted to continue our relationship with both Bridges and Wrenbridge as they bring forward a highly sustainable logistics portfolio – including working with their prospective occupiers to ensure arrangements are fit for an increasingly ESG-focused future.”
Victoria Towers, assisted by Commercial Real Estate Senior Associate, Edward Glass, Construction Partner, Sarah Cook, Construction Senior Associate, Dan Burr, and Construction Associate, Lauren Hepburn, advised on the deal.
Logistics needs to reach a more diverse talent pool – Victoria Towers writes to Property Week Editor
4 August 2023
Views
Commercial Real Estate Partner and Co-Head of the Industrial and Logistics group, Victoria Towers, has written to the Editor of Property Week on how “the recent announcement that the Generation Logistics campaign, which aims to improve recruitment and retention in the logistics workforce, securing another year of government funding is welcome news for the sector, where there remains a critical need to expand the labour pool.”
Towers writes: “Based on independent research we recently commissioned, investors and developers active in industrial and logistics real estate cite availability of labour as the third most significant factor – close on the heels of connectivity and value – in deciding where to invest.
“Encouragingly, this year’s Department for Transport funding is to focus on raising the profile of logistics in schools and colleges, which chimes with the wishes of investors and developers, who responded to our survey calling for careers advice alongside talks in schools and the promotion of training.
“Our study found potential for the sector to make itself more attractive to a diverse talent pool, highlighting that the rise in last-mile logistics should support more part-time roles in daytime hours for those with family commitments. Automation was thought likely to lead to a gradual change in the nature of careers, increasing the need for engineers and technicians.
“The sector needs to both demystify its operations, promote the diversity of opportunities and reach a more diverse talent pool. Youngsters need to understand this isn’t simply an industry of long-distance lorry drivers, away from their families for days at a time.
“This is a truly nationwide sector, looking to be in easy reach of every home and business in the UK. The industry needs to reach a lot of schools and colleges. Even with contributions from industry, this year’s government funding of £300,000 will be stretched thin and more needs to be done to tackle the issue.”
To explore more of our ‘Outside the Box’ research, please click here.
This letter was first published by Property Week on 3 August 2023 and can be read here (behind their paywall).
Evolving industrial and logistics sector finds reason for optimism – Victoria Towers speaks to Property Week
26 May 2023
Views
Commercial Real Estate Partner and Co-Head of the Industrial & Logistics group, Victoria Towers, has spoken to Property Week on Forsters’ survey, conducted for our recent ‘Outside the Box‘ campaign, on current market sentiment within the Industrial and Logistics space.
Towers says: “Investors are confident of long-term occupier demand and of overcoming construction risk as inflation peaks.
“So much is changing so quickly, and the sector is definitely having to adapt more than it has previously. The sector is innovating and continues to show resilience.”
To find out more about our ‘Outside the Box’ campaign and explore the statistics learnt from our survey, click here.
This article was originally published on 12 May 2023 by Property Week and can be read here (behind their paywall).
Why the logistics sector is under pressure to evolve – Victoria Towers writes for React News
26 May 2023
Views
Commercial Real Estate Partner and Co-Head of the Industrial & Logistics group, Victoria Towers, has written for React News on the evolution of the logistics sector and how owners are pushing to innovate and meet sustainability goals.
Towers writes that “[Forsters’] recent Outside the Box study of the expectations of investors and developers in the [industrial and logistics] sector confirms our own experience as lawyers in advising on our clients’ innovations. Multi-storey formats, renewable energy and integration with residential require legal and technological support.”
From the survey, we saw that the greatest consensus was on multi-storey sheds. “77% believe they will play a large role in the UK logistics sector in the future and 52% have seen an increase in developer appetite in the past year.”
The key driver for this is the competition for land, with all that’s missing a confidence in the resilience of this new multi-storey shed format. “Are there cost-effective structural engineering solutions and ways around a vehicle stuck on a ramp? Are goods lifts now reliable enough?” Regardless, Towers says we should expect to see a proliferation of warehouses, light industrial units and the occasional 20-storey tower.
“In the meantime, lawyers will develop the legal structures needed to ensure that a multi-tenanted, multi-storey scheme remains attractive to both tenants and investors.”
The co-location of residential and urban logistics is causing issues in relation to design, technology and legal rights, with classic NIMBYism in play.
The solution will most likely lie with technology, which will also improve prospects for planning. Key forms of technology raised in our survey include clean energy, modernised site infrastructure, air filters and quieter HGV engines. There is also particular optimism for the impact of e-commerce, robotics (67%) and EV charging.
The real cause for excitement is, however, the impacts expected from artificial intelligence. Towers explains that “automation has required tighter legal controls on landlords to avoid them marching in on an inspection and getting in the way of a robot. As we start to see the uses emerging for AI we will get a clearer sense of the legal principles no longer fit for purpose and the gaps in regulation.”
Missing link
Battery storage has been a particular source of debate. Industrial real estate is becoming increasingly power hungry, and the “broad, flat roofs of our sheds are a gift for photovoltaics.”
“Battery storage is the missing link. The industry needs the capacity and ability to retain the energy generated by photovoltaics. If the panels produce excess energy, it is wasted should the National Grid not buy it back and there is nowhere to store it.
“The innovations we have discussed so far could have a big impact on the efficiency, value and deliverability of industrial real estate. But there could be a more disruptive change in the pipeline.”
Towers goes onto highlight the environmental incentive of shifting from road to rail, with particular reference to HGVS. This sentiment is shown in our survey with many anticipating rail freight generating the greatest growth in occupier demand in 2023.
“The picture that emerges is of a sector that is far from complacent in surfing the continuing wave of strong demand and high values. The industrial real estate sector is conscious of pressure to transform its environmental performance, and is investing in the innovations that will deliver a cleaner and more efficient industry.”
To find out more about our ‘Outside the Box’ campaign and explore the findings of our survey in detail, click here.
This article was originally published on 22 May 2023 by React News and can be read here (behind their paywall).
Chris Armstrong of McDonald’s Restaurants and Commercial Real Estate partner Vicki Towers join podcast host Miri Stickland to talk through Chris’s experiences managing the roll out of rapid EVCPs across McDonald’s UK drive-through restaurant portfolio.
A tale of two halves… – Victoria Towers speaks to Logistics Manager
9 February 2023
Views
“The disconnect between the industrial logistics investment market and the industrial logistics occupier market seems to be at its greatest, following a tumultuous year but what does this mean for occupiers going forward?”
Partner and Co-Head of Industrial & Logistics, Victoria Towers, has provided expert commentary to Logistics Manager magazine on the growing discrepancy between the sector’s occupier market and investment market; how the former remains strong, but the latter has nosedived.
Towers describes how “We started the year [2022] in a beautiful world of high demand and a buoyant supply pipeline. Focus was on forward fundings, which meant funds were willing to pay handsomely for land in advance of development starting on site. Developments progressed well and contractors were robust. It was a market that seemed to be delivering for developers, funders, and tenants alike.”
The article, which includes additional commentary from other leading figures in the Industrial & Logistics sector, summarises the impact on the market of global factors such as the pandemic and Russia’s invasion of Ukraine, the increased cost of borrowing and the likelihood of a resultant slump in occupier demand. The article concludes with a look to the year ahead; 2023’s forecasted recession and prospective periods of both difficulty and opportunity for occupiers.
This article first appeared in the February 2023 edition of Logistics Manager magazine, it is available here.
Historic England’s General Counsel, Andrew Wiseman and Commercial Real Estate partner Victoria Towers join host Miri Stickland to unpick what a historic building is and how can they be developed and adapted for future generations, with a particular eye on the challenges around introducing energy efficiency measures into historic buildings.
Property Week’s Year in Review – Victoria Towers talks ESG
16 December 2022
Views
Partner and Co-Head of Industrial and Logistics, Victoria Towers, has contributed to Property Week‘s ‘Year in Review’ – a look back on the key legal issues in property over the last year.
“Planning, ESG, the workplace, skills, cladding and building safety were all on the property agenda in 2022”, with Towers offering her insight into how environmental, social and governance (ESG) considerations – and in particular the ‘environmental’ – have risen to greater prominence this year.
Towers says: “Overall, 2022 has seen a more sophisticated approach to analysing the metrics of ESG compliance emerge, certainly from the sustainability side, and no doubt we will see growth from the social value angle over the coming months.
“It is also refreshing to see attention being given to what achieving net zero actually means, with a hard stance being taken in relation to offsetting and what actually counts.”
She says developers have also begun to adopt more widespread ESG credentials in their buildings, even without these being imposed by the government. “The voluntary uptake of [energy efficiency rating system] NABERS has become more widespread, which is hopefully a sign of things to come.”
This article was first published on 16 December 2022 in Property Week and can be read in full here.
Electric Dreams – Victoria Towers speaks to Property Week
30 November 2022
Views
Co-Head of Industrials & Logistics, Victoria Towers, has spoken to Property Week about the aim of warehouse developers to get ahead of the game by installing charging facilities for electric HGVs and vans, as well as investing in solar power.
In light of the statistic that 16% of the UK’s domestic transport emissions come from HGVs, many warehouse developers are looking to increase the current percentage of electric vehicle (EV) charging provision, which currently stands at around 10% of parking spaces.
While the sale of new petrol and diesel cars will be banned by 2030, new petrol or diesel HGVs will not be banned until 2040. Nevertheless, eHGVs are gaining momentum.
Towers commented: “The new shed developments we’re seeing all have EV charging provision for cars and vans and the bigger players are starting to secure warehouses with provision for HGVs. We expect other businesses to follow suit, especially as restrictions and extra charges come into force in towns and city centres to deter the use of petrol and diesel vehicles.”
This article was first published in Property Week on 25 November 2022 and is available to read in full here, behind their paywall.
Depth and diversification will drive logistics growth – Victoria Towers writes for React News
27 July 2022
Views
The emergence of a new sub-sector of alternative uses is providing opportunities for investors and developers.
Commercial Real Estate Partner and Co-Head of Logistics, Victoria Towers, has guest written for React News on the rapid growth of the industrial and logistics market, resulting from changes in consumer behaviour thanks to the pandemic, the adoption of new technology, and the inexorable rise of e-commerce.
Contrary to popular belief that Amazon’s apparent reining in of its growing property requirements would curtail market growth, recent research from CBRE demonstrates a 10% growth in take-up of warehouse space between the first half of this year and last, alongside a UK vacancy rate of 1.2% – a new record low.
Towers describes how such growth and confidence in the sector can be attributed to the diversity across its occupier base. Production and distribution, life sciences, and light industry are all sectors worth mentioning, whilst “data centres have [also] become critical pieces of national infrastructure, required to store and process the data by the move to cloud-based computing.”
The lack of supply and high interest in this sector will continue to fuel the meteoric rise of the industrials and logistics market, and the diversification of the occupier base means that the pace of this growth may yet accelerate further. Landlords and developers must be forward-thinking and quick-moving in order to flourish and meet this growing demand from uses which will, over time, emerge from the alternative to the mainstream class.
This article originally appeared in React News on 21 July 2022, available here behind their paywall.
Where have all the good sheds gone… – Victoria Towers writes for Logistics Manager
6 July 2022
Views
You can’t find a good shed these days for what seems like love nor money – is this going to be the new ‘normal’?
Industrials & Logistics Partner, Victoria Towers, has provided expert commentary to Logistics Manager magazine on the growing supply-demand imbalance of warehouse space and the unsurprising increase in rent levels, highlighting that “we are still in a landlord’s market.”
As a result, speculative space is frequently being let during construction, prior to practical completion.
Towers adds that “with demand still very much outweighing supply, occupiers are also accepting longer leases and thought is being given to rent reviews. Rather than open market rent reviews, developers and landlords are looking at CPI rent reviews, and this is being accepted by tenants.”
The article summarises that due to inefficiencies within councils in relation to planning approvals for new developments, developers and investors are essentially taking a lottery ticket when it comes to getting their planning application approved, regardless of their scale of investment or prior experience with the system.
This article first appeared in the July 2022 edition of Logistics Manager magazine, it is available here.
The UK Logistics Market, A Gift That Keeps On Giving – Victoria Towers speaks to Logistics Manager
6 May 2022
Views
Despite the UK experiencing its deepest recession for 300 years, the industrials and logistics property industry has been enjoying a surprising period of growth.
Industrials & Logistics Partner, Victoria Towers, has provided expert commentary to Logistics Manager magazine on this welcome rise in demand for the sector, describing how Forsters“has seen rent levels in London go up from £17.50 to £24 per square foot (an increase of 37%) in ‘a matter of months.'”
“You are not going to see that kind of growth in offices [or retail at the moment].”
An interesting aspect of today’s market, she adds, which is contributing to the rise in rental prices, “is that some of the big players cannot get their foot in the door and so are pairing-up with developers on the ground and pursuing off-market deals.”
Victoria explains that many investors look to avoid open market sales in which they may be outbid, and so are acting quickly to prevent such competitive situations.
This article first appeared in the May 2022 edition of Logistics Manager magazine, it is available here.
Sustainability: Strategic planning for real estate projects
14 February 2022
Podcasts and videos
Managing Director of sustainability consultants Element Four, Georgia Elliott-Smith, and Commercial Real Estate Partner, Vicki Towers, join podcast host, Miri Stickland, to discuss the advantages of strategic sustainability planning within the real estate sector, the concept of Net Zero, why you shouldn’t assume that a BREEAM excellent rating necessarily means a high EPC rating and the direction of travel for the energy rating of buildings.
Georgia talks us through some of the most commonly used acronyms, certifications and standards in the world of sustainability and real estate:
BREEAM
“So BREEAM is the Building Research Establishments Environmental Assessment Method and it is a really widely used method for assessing how environmentally friendly a building is it can be used in a number of different ways for different types of projects so you have new construction, refurbishment and fit-out standard, you’ve got an infrastructure standard and one for communities which you use for master planning projects. There is also a BREAAM in use standard as well which you can use for operation buildings to work on things like energy efficiency, water efficiency and so on. So it is split into ten categories – ten different ways in which you can focus on your building and looks at things like pollution, waste, energy, ecology and so on and in each of those different sections you are able to achieve points and the more points you get – credits they call them within the Scheme – the higher your score and your overall rating. So, the ratings are broken down into a grading system so you have a simple pass – you then go into good, very good, excellent and the highest rating is outstanding.
The good things about BREEAM is that it holds your design team’s toes to the fire and given that certain performance standards are required it means that some of those things cannot be value engineered out, so it is really good for making sure that design intent is followed through. Some of the negative and some of its critics say that actually it is simply an environmental assessment method and nothing more. It isn’t really an indicator of true sustainable development and actually the design team don’t require a great deal of client or investor engagement in order to deliver a BREEAM high level of standard and so it doesn’t take into account a lot of fundamental sustainability considerations but overall you know it is very well recognised, very popular and a good standard.”
GRESB
“GRESB is the standard for the Global Real Estate Sustainability Benchmark and it is a globally applicable benchmark for Environmental Social and Governance issues (ESG). It is, as the name suggests, specifically for the real estate sector and it is aligned by the GRI Initiative which is the Global Reporting Initiative which is a global sustainability reporting standard. What it does is you self report to GRESB so there are tools online that you can access for free where you go in you answer many questions. There are hundreds of questions – as I say you don’t enter GRESB lightly but you go in, you answer questions and you provide data on the environmental, social and governance issues for your business so that will be things like disclosing information about your carbon emissions, your water consumption, the sorts of impact that you have on communities and employees, data to do with things like gender balance and the living wage provision and so on so it is a very broad very wide ranging question set and that is a way of getting a benchmark score for your approach to ESG and it is a way of communicating and reporting with your stakeholders on how you are doing as an organisation.
You can then see as well how you have scored in different sections of the GRESB rating so you can see whether maybe you are acing it on environmental issues but you are not doing so much on social and community issues so it is a way of prioritising your investment moving forward and it is also aligned with lots of other certifications so if you achieve BREEAM, Well Building or perhaps Fit Well Certifications on your real estate they will add points in different sections of the GRESB standard so it seeks to align a lot of different moving parts across the sector and give you good quality information to share with the market.”
NABERS
“It actually stands for the National Australian Built Environment Rating System. It came over to the UK a couple of years ago back in 2020/2021 and the Better Buildings Partnership took stewardship of trialling the scheme in the UK. It had been incredibly successful in Australia as a mechanism for designing and operating buildings in line with true energy efficiency. So, what it seeks to do is close what we call the design gap so the design performance gap is that when you intend the energy performance of a building to be often doesn’t play out in operation of the building. That is what we call the compliance gap there, so you design a building in order to get a certain EPC rating in the UK what we then find is that the building is not operating in line with its predicted energy efficiency in practice so there is this big gap between design intent and actual performance. NABERS closes that gap and what it requires that you do is that instead of designing the building for compliance with a particular EPC rating you add in other bits of the energy jigsaw that you wouldn’t normally have to assess for compliance so things like small power, looking at what is likely to be the small power draw in a building, you add in things like data servers which again are not part of a standard building compliance model for energy, you look at actual hours of operation of the building based on the local demographic or the type of industry in that area rather than just falling down on a compliance assumption so you use much more accurate modelling of what the energy performance is likely to be of the building and then you design the building according to a target energy performance. It means that NABERS is much much more accurate when it comes to predicting the actual energy performance of a building – much more accurate than EPCs and it is really the new kid on the block but I think it is going to take off very very quickly.
It was originally launched in September 2021 it is now managed by the BRE as a certification scheme – there are two stages to it so one is the design for performance stage (DFP) that is the design stage so where you design team actually do the building modelling and they design the building to achieve a certain energy performance. The second stage of the certification where you get final certification is after 12 months of building operation you then take a look how it has performed during that 12 months you will have monitored its performance, you will have done some fine tuning and tweaking of the energy systems in the building and if your building is operating as per the design intent after 12 months then you can get your final certification so it is a really good robust scheme that means that our buildings are likely to perform in a much more efficient way.”
WELL Standard Building
“The WELL Building Standard came to the UK in 2014. It was developed in the USA. It’s a standard and the first standard internationally that focusses entirely on the occupant experience and the health and wellbeing of the occupants of the building and the neighbouring community.
So, when we look at other standards that are much older, BREEAM for example has been around since 1990, but BREEAM is an environmental assessment method and there are parts of that standard that do look at local community but they are only incidental really and very small parts of that assessment. Well is entirely about human experience and it was really revolutionary when it came to the UK when it was released because we are looking at buildings. As we had been looking at lot of the environmental impact of buildings for many years but although we were trying to design buildings that were healthy and good for people there wasn’t really a yard stick for measuring that and there wasn’t really an agreed design standard for how you go about assessing and improving buildings for human health. So WELL came on to the scene in 2014. Since then it’s been revised a couple of times and now we have Well version 2. It’s applicable for both whole buildings and also core and shell so landlord demise. You can also do a commercial interior project if you are just doing one or two floors for example as a tenant of a building. It is made up of what we call pre-conditions which are basic requirements that every single project must achieve and then other credits that are called optimisations and the way that the scoring works is that all buildings have to achieve the pre-conditions and then you build up your optimisations and the more points you get through optimisations the higher your final rating and the ratings are silver, gold and platinum. So, there’s three that are available. Very similar to BREEAM you work through it with your design team from the very beginning of the project so what we do as consultants we create a pre-assessment where we will look at all of the various bits of the standard, work with the design team and what are the achievable levels and then try and challenge them to go further and do more and the things that they focus on. There are ten, what we call concepts which are essentially the chapters, but they are things like air, water, light, movement, nutrition and so on and it goes on through ten of those different factors. It’s really striving to achieve clean air, lots of good available drinking water, movement through the building is really important so trying to drive people into using the stairs rather than lifts for example. And making sure that our indoor environment is healthy so making sure we are not bringing products into that space whether it’s cleaning products or furniture that are bringing pollutants into the space and our understanding, the science of human health and how it’s impacted by our buildings has just gone off the scale recently and I think particularly with COVID there’s this new appreciation of the stuff that we are breathing in, you know, what we surround ourselves with. And the importance of things like daylight, of exercise, of improving our mental health through socialising, communicating you know, the effect of good sleep and good nutrition. And we know that our buildings can really impact on our quality of life. So Well seeks to distil all of that science into some design features that can be implemented.
The other thing about WELL which is new and really quite revolutionary is that it’s not just a design standard, it’s about the operation of the building. So, you cannot achieve Well certification until after occupants have moved into the building and have been working in that space for at least three months. At that point you will have what’s called a performance verification visit where an auditor will come to the site and will check that people are using that space in the way it was designed and intended to be used and that the space is performing. So, they will come and take air quality readings, they will come and do sampling of the drinking water quality, they will check light levels and they will check that everything you have said at design stage was happening actually is happening in the building. The certification once you get it is valid for three years so it really is a living standard that you then have to maintain through operations so one of the big changes between this and I think BREAM is that your facilities managers, all of the building occupants, people like the cleaning contractors, the caterers all need to understand how the Well Standard works and what bits of their job are really important to maintain this healthy indoor environment and what has to be done. But what that means as a result is that when you walk into a Well certified building you can tell it’s different, it feels different, it looks different, the way you interact with it is different and there is a lot more awareness as well amongst the people inside of what a great space they are in and the communication of that is really powerful I think for people particularly post-COVID.”
RESET Standard
“The Reset Standard is an international quality standard for indoor air. So, it came from China where it was originally developed where municipal air quality is notoriously poor particularly in urban areas and they wanted to develop a standard that would demonstrate that the indoor air quality in buildings was good, so the reset standard was developed by the organisation GIGA which is a Chinese organisation.
It has become really popular now in the era of Covid and post Covid in order to demonstrate that the equipment that we are using and the way in which are monitoring indoor air quality is of a good standard so at the moment indoor air quality monitoring kit is a real world test you can go onto the internet and for a few pounds you can buy a little plug in air sensor that just plugs into your computer and gives you readings of the air quality. You can also spend £10,000 on a piece of air quality testing kit. You know, how are you supposed to know which one is good and which one is reliable and whether they are accurately calibrated and whether the componentry is good and all of that stuff. It is really difficult to be able to discern good kit. Reset has two parts to it really. One is that is creates a quality mark for the tech for the kit so it certifies the particular indoor air quality sensors are of a high standard and you can go onto their website and see which of those pass their test and so which are recommended and then the second part is that they provide a quality design standard that says where you put the sensors for exampled that they need to be within the breathing zone which is at between about 5/6ft high in your space. They need to be in certain areas so you know you don’t end up with your sensors just in corridors they need to be in the arears that are occupied by people regularly so what it does it sets out a design standard for where you put the sensors and the quality of the sensors. What you then do is that there are two versions of the standard that you can certify to. One is the base building standard for landlords and what that does is that you put a sensor on the outside of your air handling kit to monitor the external air quality and then you put sensors the other side of the air handling kit so the air intake post filtration and what that then does is it verifies the quality of the air that is actually being delivered to the floor plates so that all of your tenants know that they are getting good quality air coming through into their floors.
The other standard is the commercial interiors standard and that is really where you put the sensors in the floor plate and you will then see changes depending on how many people are in the space, whether the cleaners are in and spraying chemicals everywhere, you know you will see differences in temperature, humidity and so on and that is really the exciting bit that you can see live what is going on in your space and how your activities are impacting on the air quality. The requirements of both standards is that data is consistently monitored and uploaded so for both the landlord’s standard and the interiors standard you need to have a live display showing the air quality at that time that any occupant or visitor to the building can access so it really does keep people alert to the conditions in that space and it means that you can then look back at that data and you can see what happened aligned with different events so if you have a big town hall meeting in your space you can see how that impacts on the quality of the space. If you have got, like I say, cleaners coming in and the idea is that they are supposed to be using low toxin chemicals, low toxin products in order to maintain good air quality you can see whether that is happening and you can directly see the impact so it actually develops this ownership over the air in the space and a lot of education and you get people getting quite geeky about it and quite excited it is really cool when you do it I mean it is definitely not something to be entered into lightly because you cannot just plug it in and forget about it you do need to constantly be checking, be aware, you need alerts in the system to tell you when something is going on but because of that people within the space can be assured that their facilities managers, the people that run the building, are really on top of it and are aware of the air quality in the building.”
TCFD
“TCFD stands for the Taskforce for Climate related Financial Disclosures. This was established in 2015 and it was established by Mark Carney and Michael Bloomberg as an initiative and it started out as a voluntary initiative and really what it was about was getting major fund managers, asset managers, the financial institutions to start examining and disclosing information about how their investments impacted on the climate and how the climate changing then impacted on their investments so it was this two way street looking at how much carbon are we emitting, what are our liabilities and also looking at changing where the patterns with moving populations and so on related to climate how is that going to impact our funds. So that is how it started as a voluntary initiative but it has been really successful and has been picked up by the UK government now in October 2021 to coincide with COP the Government announced that as of April 2022 the TCFD rules are going to become mandatory for large UK companies so that is for companies that are listed in the London Stock Exchange, any company that is required to produce a non-financial statement and it is going to be for private companies as well and limited liability partnerships that have more than 500 staff members and the turnover of more than £500m. So that is basically who is going to be included in the scheme – the way that the TCFD’s rules are set up is they have four what they call pillars and the pillars are governance, strategy, risk management and then metrics and targets and within those four pillars they have got 11 recommendations and those are things like describe the risks to your organisation of in the short, medium and long term of climate change. Describe your carbon emissions related to your investments and things like that. Now, at the moment, we are not exactly clear on the wording of the mandatory requirement for Government but what we do know is that from April this year those largest companies are going to have to start reporting in line with the TCFD rules.”
We are committed to running a business that is environmentally sustainable. Not only do we continually strive to minimise our impact on the environment, but we have years of experience of incorporating sustainability considerations into the legal advice that we provide to our clients.
Our sustainability hub brings together the team’s insights and legal expertise on a broad range of environmental matters that affect our clients’ business and personal affairs. This is a rapidly evolving and wide-ranging area of law and we will continue to share our insights about related legal developments on this hub.
Forsters advises Barwood Capital on Eton House Richmond
2 December 2021
News
The Commercial Real Estate team has advised a fund of Barwood Capital on its purchase of Eton House, a 32,774 sq ft office building in the heart of Richmond, which it will repurpose to outstanding and sustainable office space.
This purchase was the first in the office sector for Barwood since 2016. Eton House will undergo a full back-to-frame refurbishment with an additional floor of office accommodation and roof terrace, targeting a BREEAM rating of Excellent. Eton House became vacant in November 2021 and was acquired from Aviva Life & Pensions UK Ltd for £12.9 million.
The Forsters’ team that advised on the transaction was led by Partner Victoria Towers, who was assisted by Senior Associate Alexandra Burnaby.
Vicki commented: “I am delighted to have led the Forsters’ team advising Barwood on this office deal. They are a great team and I am personally pleased to work with them on another deal.”
Adam Smith, Asset Management Director at Barwood Capital commented: “The pandemic has accelerated existing themes in the office sector, where well specified office space with a keen focus on ESG credentials continues to outperform. Our refurbishment strategy for this asset aims to deliver such space into a supply constrained market.”
Barwood Capital was advised by real estate investment advisors ACRE Capital Real Estate. Moorevale will act as Development Manager for the redevelopment scheme.
The deal received coverage in Business Leader and the Property Trade Press.
To read our latest on sustainability in the property sector please see our latest on our Sustainability Hub. For latest office insights please click here.
Our sustainability hub brings together our insights and legal expertise on a broad range of environmental matters that affect our clients’ business and personal affairs. This is a rapidly evolving and wide-ranging area of law and we will continue to share our insights about related legal developments on this hub.
Green Lease / Sustainability Playbook – Quick Guide
30 April 2021
News
Landlord and tenant obligations as to sustainability can take a number of different forms. In this briefing we set out an overview of the documents you may come across and when they are most likely to be used.
Head of terms template wording
What does it do?
Gives clarity at the pre-contract stage that a green lease/sustainability commitment is agreed in principle between the parties. Offers an early focal point for discussion around what that commitment is going to look like.
Who is it for?
New tenants.
Green lease clauses
What does it do?
Provides enforceable contractual commitments to ensure that the premises are occupied and serviced in a manner which fosters sustainability. Clauses can be graduated from a less stringent “light green” commitment to more ambitious “dark green” obligations, depending on the circumstances.
Who is it for?
New tenants. Existing tenants seeking renewal (subject to being a “reasonable modernisation” any 1954 Act protected renewal).
Memorandum of understanding
What does it do?
A non-binding document which sets out a statement of intent between the parties, providing a clear framework to operate within. This will often be based on the model form MOU drafted by the Better Buildings Partnership as part of their Green Lease toolkit. Particular attention will be required to the Appendix where best practice recommendations are set out, which the parties agree to consider and, where appropriate, implement.
Who is it for?
Both new and existing tenants who are prepared to engage with the concept of working together with their landlord to reduce the environmental impact of their premises but are not prepared to enter into contractually binding commitments.
Data sharing letter of consent
What does it do?
Typically provides that the tenant will collect and share environmental performance data for the premises and/or allows the landlord to collect that data directly itself. May include optionality as to who is to undertake (and bear the cost) of the installation of any additional metering or other smart technology required to collect such data. Arrangement will usually be terminable on notice.
Who is it for?
All tenants who are only prepared to agree to data collection and the installation of metering for that purpose.
Tips for maximising engagement
Be Collaborative
Identify which tenants/properties are going to be the “easier wins” and start with them. Does the tenant have their own ESG strategy which you can refer to for discussion purposes? If dealing with an existing tenant, is a lease event due at which you can initiate a discussion?
Strategise
Consider your data collection/sharing strategy – are you happy to rely on data collected and shared by the tenant or would you prefer to control the whole collection process yourself? On multi-let properties, it may be administratively easier to try and adopt the same approach for all lettings.
Be Clear on the Mutual Benefits
Have an open dialogue with your tenants from the start – we recommend ensuring you are clear from the outset as to the parameters of your ESG strategy and its potential benefits for them – both in terms of direct cost reduction and the creation of cultural value.
Adopt a Systemic Approach
Agreeing the general principle early on will cut down on negotiation of the wording at a later stage in the transaction. You may want to consider your internal policies in respect of signing off any proposed amendments to your standard sustainability clauses. Are you adopting a grading system for how “green” your leases are?
Future-Proof
Keep ESG under review – schedule regular catch-ups with your professional advisors to ensure that the strategy and drafting remains fit for purpose. Make sure you stay well-informed of developments within the market to help you anticipate future areas of focus.
A PDF copy of the article above will be available to download here.
Victoria Towers is a Partner, Louise Irvine is a Senior Knowledge Development Lawyer and Edward Glass is a Senior Associate. All authors sit in our Commercial Real Estate team.
Our sustainability hub brings together the team’s insights and legal expertise on a broad range of environmental matters that affect our clients’ business and personal affairs. This is a rapidly evolving and wide-ranging area of law and we will continue to share our insights about related legal developments on this hub.
COVID-19: What will the impact on construction projects be?
6 March 2020
News
The WHO has declared the COVID-19 a public health emergency of international concern with the potential to become a pandemic, and the government has cautioned that cases of COVID-19 in the UK are likely to rise significantly over the coming days and weeks.
In the event of a major outbreak of COVID-19 in the UK, construction projects could be affected. Should there be significant interruptions in supply chains, or if workers are required to down tools and remain off-site for long periods of time, what rights and remedies might the respective parties to a building contract or development agreement have?
One thing that all developers can do now is review the contractual position under their existing contracts, in anticipation of contractor claims for extension of time, should COVID-19 continue to spread.
Delay events
A building contract or development agreement will usually specify certain circumstances which, if they occur, entitle a contractor to claim an extension of time to complete the works.
However, the JCT standard forms of building contract do not specifically list disease, epidemics or pandemics in the list of delay events.
In the absence of a contractual provision dealing with delays caused by pandemics or epidemics, a contractor is likely to turn to other specified delay events in a building contract. What might these be, and what is the likelihood of such a claim being successful?
Force Majeure
Force majeure is a contractual term that provides for the award of an extension of time if works are delayed due to the occurrence of circumstances beyond the control of the parties.
There is no universal definition of force majeure however, and despite the JCT forms of contract listing “force majeure” as a delay event, these contracts don’t expand on what this term actually means.
So, would an outbreak of COVID-19 constitute a force majeure event?
There is no definitive answer to the question, but the success or otherwise of a contractor’s claim citing force majeure for COVID-19 is likely to depend on three key variables:
the scale of the outbreak;
whether there are any express provisions in the building contract or development agreement which specifically treat epidemics or pandemics as a force majeure event; and
what measures the contractor might reasonably be required to take to mitigate the effects of the delay; the JCT Design and Build contract, for instance, requires a contractor to “constantly use his best endeavours to prevent delay…however caused”.
The English courts have tended to take a restrictive approach to interpreting clauses in construction contracts which purport to excuse a contractor from performing its obligations due to supervening events. Where a contract such as the standard form JCT does not identify specific events of force majeure, then in the event of a localised outbreak the courts may still refuse to treat such an event as force majeure and may require a contractor to draft in additional resource from outside of the affected area as a means of mitigating against the delay.
It is worth noting that many of the events which are commonly associated with force majeure are already identified in the JCT contract as a delay event. A Society of Construction Law paper from February 2012 (“Force Majeure and Construction Contracts” by Adrian Williamson QC) notes that considering all the other delay events which are already listed in the JCT, “it would be a bold contractor who sought an extension of time under a JCT contract for force majeure”. The lack of force majeure-related cases under JCT contracts that have come before the courts suggests this is right.
However, it is by no means out of the question that a virus outbreak may, in certain circumstances, amount to a force majeure event. The FIDIC Yellow Book form of contract specifically lists shortages caused by an epidemic as a delay event entitling a contractor to an extension of time. The NEC4 suite of contracts does not identify epidemics as force majeure events, but in a recent publication (“Clause 60-Compensation Events” 25 February 2020), NEC uses a virus outbreak as an example of an event that would be “so unlikely that it would not be sensible to allocate risk to the contractor” and could therefore constitute prevention of performance under the contract.
In any scenario, the onus will be on the contractor to establish that an outbreak constitutes a force majeure event. A contractor would need to show how the outbreak impacted on the completion of the works, and to demonstrate that it took all measures it reasonably could have in the circumstances to mitigate against the effects of the delay.
Government intervention
An alternative and perhaps more fruitful ground for an extension of time claim may be government intervention, which the JCT treats as a separate delay event.
This ground would likely cover a scenario in which the government, a public body or local authority passed emergency legislation which affected the ability of workers or goods to travel in the event of an outbreak.
The government has already issued The Health Protection (Coronavirus) Regulations 2020. Should the current outbreak worsen, further preventative measures restricting the movement of goods and people could be implemented at short notice and without much time for contractors to prepare. Clearly, the outbreak would already have become (or have threatened to become) sufficiently severe for the government to take such measures.
A contractor’s claim for an extension of time under these circumstances might be more likely to succeed.
Moving forward…
Historically we have not seen many construction contracts which have been amended to deal specifically with the risk of epidemic or pandemic. However, in the light of COVID-19, we would expect contractors to become increasingly insistent on negotiating provisions in construction contracts which deal specifically with the consequences of these events. In the meantime, Forsters is continuing to monitor how the construction industry responds to the impact of COVID-19.
Richard is a Senior Associate in our Construction team.
The current global crisis is evolving rapidly, and the rules and guidance for individuals, companies and other entities to manage its implications are similarly fast moving. Notes such as this may be out of date almost as soon as they are published. If you have any questions prompted by this article or on any other matter relevant to you, please get in touch with your usual contact at Forsters.
With applications for 2020 vacation schemes and 2022 training contracts now open, Graduate Recruitment partner Victoria Towers and Graduate Recruitment co-ordinator Holly Meldrum join podcast host Miri Stickland to talk through some of the questions they get asked most frequently by potential candidates.
“We like to see a wide range of candidates with a variety of things to offer. Having the intellectual ability to solve complex problems is the starting point and we also really like to see a genuine interest in Forsters. We are known for being a friendly, collaborative firm so we do look for people who are personable, alongside which we like to see candidates with drive, ambition and a strong work ethic.”
“It’s really important that candidates get a feel for whether the firm is right for them. Every firm is different so take the opportunity to go to open days, graduate recruitment dinners and law fairs to get that insider’s viewpoint and ask as many questions as possible. It can prove invaluable. If you can apply for a vacation scheme, we recommend that you do, as it is the best insight into the firm that you can get, although there is always space for direct applications for training contracts as well.”
“The most common mistake in application forms is spelling the firm’s name wrong or putting another firm’s name in accidentally! Make sure you get someone else to proof read your application.”
Forsters shortlisted at LawCareers.Net Awards 2019
6 March 2019
News
We are delighted to announce that Forsters has been shortlisted for ‘Best Trainer – Medium City Firm’ at the upcoming LawCareers.Net Training Contract & Recruitment Awards.
The awards set out to identify and celebrate those firms that give their trainees a flying start in the legal profession.
Forsters win graduate recruitment accolade at LawCareers.Net Awards 2018
18 May 2018
News
Forsters was named ‘Best Recruiter – Medium City Firm’ at the 15th annual LawCareers.Net Training & Recruitment Awards held in London on Thursday 17 May 2018.
The awards set out to identify and celebrate those firms that give their trainees a flying start in the legal profession.
