Growing demand for homes and lab space may be met by repurposing vacant offices

A growing mismatch between supply and demand in the housing and life sciences sectors is fuelling a wave of office conversions across the UK, as developers seek to repurpose outdated vacant offices to meet changing needs, according to a new report from CBRE. According to the real estate firm, the rise in hybrid and remote working has left a significant volume of secondary office space vacant, with many buildings no longer fit for modern corporate requirements. Rather than invest in costly retrofitting, landlords and investors are increasingly exploring conversion opportunities – particularly into residential units and life sciences laboratories.

Estimates suggest that vacant office stock across major UK cities could be transformed into tens of thousands of new homes, providing a much-needed boost to housing supply at a time when affordability and availability remain key challenges. Cities such as Birmingham, Manchester, Leeds, and Glasgow are witnessing renewed interest in centrally located office buildings that offer potential for residential redevelopment.

At the same time, the life sciences sector is experiencing unprecedented demand for lab space, driven by government ambitions to position the UK as a global science leader by the end of the decade. Cities like Cambridge, Oxford, and parts of London’s knowledge corridor are struggling to accommodate growing clusters of biotech and research firms, creating opportunities for investors to convert redundant offices into specialist facilities.

Between 2022 and 2024, nearly £3.5 billion has been invested in underused office assets across the country, with a view to repurposing them. This reflects not only a shift in occupational trends but also a more pragmatic response to looming regulatory deadlines. From 2030, all commercial buildings will be required to meet a minimum EPC rating of B – a standard that many older offices cannot achieve without significant upgrades.

While the conversion trend is gathering pace, it is not without obstacles. Technical challenges related to layout, services, and compliance, along with local planning hurdles, mean that not all offices are viable candidates for transformation. Nonetheless, the momentum is clear: the UK’s changing social and economic landscape is rewriting the rules for commercial real estate, with obsolete offices emerging as a key part of the solution.

Image: Astra Zeneca Discovery Centre, Cambridge Herzog & de Meuron / BDP