Once the preserve of artists, live/work properties are capturing the imaginations of developers in markets around the world keen to capitalise on the workplace trends towards flexible working hours and telecommuting.
It is more than just a fad for those wanting to avoid the rush-hour traffic, though.
Developers are queuing up to convert abandoned buildings into live/work apartments, with investors renting or selling properties.
First heard of in the US in the 1960s, live/work properties can be purpose-built or converted premises that cater to both residential and work functions. “Live/work properties were born in places such as SoHo in New York in the 1960s where old warehouses were converted into lofts, first by artists and later to accommodate people pursuing all kinds of work,” says Thomas Dolan, founder of the Live/Work Institute in California. But the trend has spread across the US and has become particularly popular on the west coast.
Live/work developments appeal for many reasons. First, homes converted to live/work are worth more. Homefinderuk.com reports a price differential of £2450 ($4726) to £80,000 for houses located in the same area with and without live/work facilities. Further benefits include lower costs from single bills for the mortgage and utilities, compared with an outside office; a lower environmental impact and fewer wasted resources from the construction process; and less travelling to and from work, allowing more time for leisure or business.
Tim Dwelly, director of the Live/Work Network in the UK, reports that live/work property is springing up across UK market towns, in addition to the many mixed-use complexes in the south-east London neighbourhoods of West Ferry, Canary Wharf, Limehouse and Borough and Southwark.
Piers Taylor, director of Mitchell Taylor architects in Bath, believes schemes are receiving a big ‘yes’ vote from UK planning authorities keen to approve more environmentally friendly properties. He says: “Live/work property now has its ‘own-use’ class, which means it is separate from residential or commercial. Local authorities are willing to grant planning permission to properties designed with sustainability in mind.”
Mr Taylor adds that planning permission for mixed-use properties located in employment areas is being awarded much more readily compared with separate residential or commercial projects.
Interest is catching on in the emerging markets as well. “The concept is well established in the US and UK, and there is no reason why international markets will not follow suit,” predicts Mr Dwelly. “As more entrepreneurs run businesses from home, this property will be the zeitgeist of future living and working.”
Moves in the Middle East
Dubai property developer First Group reports that countries across the Middle East and Asia are seeing more of the schemes. Director Chris Comer believes the uptake of such property in Dubai is still in its infancy but the market offers significant scope for the ex-pat community seeking dual-purpose property: “Live/work property in Dubai is at the forefront of people’s investment plans because of the massive shortage of temporary office and residential space. Top-end serviced accommodation is in short supply, commanding very high buy-to-let prices.”
Mr Comer believes the Middle East live/work market is being catalysed by the demand for serviced apartments. “In any city, the work/live concept thrives on massive expansion in a very short time frame,” he adds. “This is especially prevalent in countries where the IT and financial industries succeed commercially.”
Asia is experiencing similar demand. In Shanghai, such property is proving popular with ex-pat buyers and tenants wishing to live and work in the financial district. Sophie Bennett, head of sales for Shanghai Asset Management, says: “The city is enjoying a period of reinvention, with half a million people moving there every year. Many are taking up jobs and boosting the economy. This is causing a high demand for live/work property.”
In Singapore, Far East Organization has developed 227 small office home units as part of its SOHO at Central development located within the central business district. Chia Boon Kuah, Far East Organization’s deputy chief operating officer of retail and lifestyle concepts, says: “We’re encouraged by the strong response to the development. It shows the readiness and sophistication of the Singapore and regional markets in adopting the new work-life concept. This has taken on in a big way in New York and London as well as bustling Asian capitals such as Beijing and Taipei.”
Artspace Projects, a US developer specialising in artist property, has converted a portfolio of 19th-century buildings, including former theatres, opera houses, stations and hotels. The developer’s Everett Station Lofts are three adjacent buildings in the Old Town district of Portland, Oregon. They were renovated and converted in 1989 into 47 live/work units which feature high ceilings, hardwood floors, indoor parking and a courtyard shared by all residents. With a total area of 62,000 square feet, the properties are collectively worth $2.7m.