Greycoat CEO Nick Millican on Sustainability and Evolution in London’s Workspaces

Nick Millican is the chief executive of Greycoat Real Estate, a vertically integrated real estate company that boasts almost five decades of experience in central London real estate — which means Millican is up on market shifts, including the move toward greener spaces. From originating proprietary investment opportunities and delivering superior returns to providing expert asset management and redevelopment services to large institutional clients, Millican is a true industry insider, successfully steering his firm to major milestones and significant growth despite major changes across London’s numerous workspace and real estate niches.

During his decade-plus tenure at Greycoat, Millican has led a diverse team of highly skilled professionals dealing with office, strategic land, residential, industrial, and retail developments. He’s also advocated the use of green and sustainable materials and strategies in real estate, particularly in response to macro-level changes in the local and global economies.

Nick Millican on Workspace Needs Developers Must Address

Whether speaking of global events such as the COVID-19 pandemic, climate change, or changes in how businesses and consumers approach work, Nick Millican says real estate enterprises must make concerted efforts to maximize value in today’s turbulent market and be better prepared for unpredictable demand as London’s workspace needs continue to evolve.

“[What we see is that] people are revisiting working practice, whether businesses are trying to get people to come back in from a work from home dynamic or just adapting to a more networked business environment, with solutions such as Zoom,” Millican says. “So there’s quite a lot of revisiting of working practices and what our clients expect their buildings to offer them and their staff.”

With that in mind, sustainable real estate is becoming increasingly critical as the planet faces the pressures of climate change, resource depletion, and a growing global population. Sustainability in urban development involves designing and constructing buildings that are energy efficient, use renewable resources, and have minimal negative impacts on the environment. According to Nick Millican, there are many cost-saving and green, sustainable, forward-thinking practices that real estate developers and investors can adopt today in response to changes in the demand for office space. This can include using green building materials, implementing energy-efficient systems such as solar panels and smart lighting, and incorporating natural solutions like green roofs.

Says Millican, “One big thing is carbon and energy performance, and if you look at the professional services business, of which there are an awful lot, clearly, in London, and you say, ‘OK, well, everyone has to do a carbon assessment now, and where’s your business generating carbon?’ Then it falls into three large buckets: There’s business travel, there’s how people get into work, and then there’s the carbon use or footprint of the building itself that they occupy.”

That last one — the carbon footprint — is where MIllican’s expertise shines.

One of the most notable changes in demand for office space has been the need for flexibility. Real estate developers are now creating office spaces that can easily be reconfigured to accommodate multiple uses, such as collaborative workspaces, meeting areas, or individual workstations. Nick Millican says that more and more developers are opting for sustainable building materials and incorporating green design principles into their developments. Strategically planning developments in line with auxiliary needs such as recreation and transportation such as walking and bicycling paths are part of this process as well.

Post-pandemic, Nick Millican says we’ve also seen a heightened focus on health and well-being in the workplace. In response, developers have begun to prioritize features such as outdoor terraces and air filtration systems to create healthy and comfortable working environments. Increased cleaning and sanitation, touchless technologies, and social distancing measures to ensure the safety of occupants.

Many modern office developments also incorporate community-focused amenities into their projects and developments that can help foster a sense of belonging and promote work-life balance, such as fitness centers, communal workspaces, and rooftop gardens. In addition, developers are embracing the virtual and remote work trends — part of the pandemic’s legacy in that it accelerated the adoption of virtual and remote work — but instead of doing away with existing spaces, they are reconfigured to allow businesses to have a brick-and-mortar presence without the expense of a full-time office.

Additional Considerations for Real Estate Success

An important driver for the push toward sustainability in real estate is government regulation and incentives. Many countries have implemented policies designed to encourage developers to incorporate sustainable practices in their projects through measures such as tax breaks and subsidies.

Additionally, consumer demand for eco-friendly living has played a role in promoting sustainable initiatives in urban development. Many real estate clients say that energy efficiency, indoor air quality, and environmentally friendly features are important factors when considering a property.

In general, Nick Millican says that determining how to move forward with a given project — which can be a decision between tearing down an old building or renovating an existing one to cater to the changing needs of commercial clients — requires consideration of:

— Cost-effectiveness: Renovating an existing building can sometimes be more cost-effective than tearing it down and building a new one.

— Client preferences: If a client is looking for modern office workspaces with specific features that may not be possible in an older building, it may be worth considering tearing down the building and starting fresh to meet those needs.

— Sustainability: Demolition and construction can have a significant environmental impact and may not always be viable.

— Future market trends: Current and future market trends in commercial real estate will determine the expected value of initiatives launched today.

Ultimately, the best course of action depends on a combination of these factors and specific business objectives. When explaining his decision-making process, Nick Millican says,

“As a developer, what we focus on is making sure the bones of the building enable someone to do that. So typically, we’d be very focused on the provision of outside spaces for tenants, providing an entrance experience that typically would have breakout spaces, cafes, etc., and a lower ground floor that gives a bit of atmosphere and environment for tenants in the building.”

Millican notes that how the clients occupy the spaces is largely up to them, so he and his team try to look for buildings that offer flexibility and appeal to the maximum number of tenants who would occupy it in different ways.

Millican also talks about carbon emissions and energy performance. “When a business is looking to reduce its carbon footprint, whether it’s as dramatic as becoming carbon neutral or something in between, that’s a big area of focus for them where they can make a big difference. And so, that’s a big driver, particularly for corporate HQs for the sorts of premises they want to occupy. There’s a carbon cost of running the premises such as lifts and heating and cooling, but also, there’s what people refer to as embedded carbon in the actual building. If you perform a 35-year analysis of revitalizing versus demolishing and putting up a new building, then the embedded carbon makes a big difference. So, the lowest carbon option for a tenant is often to take a refurbished building that’s done up to a high energy efficiency.”

For Nick Millican and his company, in the context of the constantly evolving real estate space, this approach has proven to be successful. Even in the larger context of climate change, new work trends, demographic shifts, and tech advancements, Millican’s strategy can help real estate investors and developers meet new challenges, respond to changing needs, and help London’s real estate market evolve sustainably — as it should.