Unintended consequences of decision may doom Scots listed buildings

In recent years, the Scottish Government's decision to devolve empty building rates relief to local authorities has ignited considerable debate over its implications for historic architecture. This policy shift, designed to empower councils to tailor their decisions to local challenges, raises serious concerns about the future of listed buildings in cities like Glasgow, where heritage and modern development often intertwine.

This change stems from the Barclay Review of 2018, and it was officially introduced on April 1, 2023. Councils such as Aberdeen City, Orkney Islands, Shetland Islands, and Renfrewshire were the first to reduce or completely eliminate relief on listed buildings, with many other councils, including Glasgow, following suit a year later. While the intent of the new empty rates policy was to reduce vacant commercial properties and stimulate economic activity, it has created unintended consequences that the sector is beginning to feel the impact of.

The building was hit by the Glasgow School of Art fire (Image: free) Undoubtedly, councils face the dual pressures of fostering economic development while conserving heritage. This balancing act may lead to decisions prioritising short-term financial gains over the long-term preservation of historic buildings, resulting in more demolitions. Although some listed buildings may be structurally unsound and no longer fit-for-purpose, the previous relief on these properties had attracted private developers eager to invest in and restore landmark buildings.

Coupled with limited grant funding and difficulties in motivating developers to invest in the preservation of our historical sites, the situation is becoming increasingly precarious.

Over 1800 items - including buildings, statues and engineering structures - in Glasgow have been listed by Historic Environment Scotland as being Buildings of Special Architectural or Historic Interest. This includes almost 100 buildings that are ‘at risk’ in the city, including on Argyle Street, Bath Street, Sauchiehall Street, Trongate and Union Street. This means that they are in danger of being lost due to neglect, decay or inappropriate development.

Listed buildings are considerably more challenging to secure planning permission for, given the need for a listed building consent. Redevelopment costs are also significantly higher, due to the complex and considerate restoration works that are often involved. Holding costs such as insurance, maintenance and utility costs are traditionally higher too. These challenges existed long before the removal of listed building relief.

To avoid empty buildings rates, some landlords may contemplate converting their commercial properties into alternative uses, such as residential units, purpose-built student accommodation, or co-working spaces. Again, many are deterred by the current planning regime and the lengthy process involved.

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In my opinion, the introduction of empty rates relief may have been reflective of market conditions in 2018, but significant changes have occurred since then, creating a different landscape. We need a coordinated approach that considers both the opportunities and challenges ahead if we are serious about regeneration and preserving the legacy of our cities as we breathe life back into empty buildings.

This highlights the importance of maintaining some form of relief on empty units. This relief can bolster the confidence and financial capabilities of landlords and prospective developers who are actively seeking to enhance the economic and social value of our urban communities.

There have been great examples of this in recent years across the city. This includes the Grade-A Listed Custom House building that sits along Glasgow’s Clydeside, which was reinstated by developer Artisan Real Estate and now functions as the main entrance to the Clayton Hotel.

There are also exciting plans in the pipeline to enhance these efforts through the delivery of a new waterfront development with pavilions and open green spaces. The Custom House Quay and Carlton Place project promises to realise an exciting new waterside destination that celebrates the city’s heritage buildings whilst complementing the surrounding areas with modern features that encourage footfall and placemaking.

It is also important to note that historic buildings often have a significant amount of embodied carbon, which is essentially the carbon footprint associated with their materials and construction.

The building was latterly a venue (Image: free)By retrofitting rather than demolishing these structures, we preserve that carbon investment. Demolition and new construction typically require substantial energy and resources, leading to additional carbon emissions. Retrofitting makes use of existing materials, reducing the demand for new resources. This not only cuts down on the carbon footprint associated with extracting and processing new materials, but also minimises waste.

The impact of removing listed building relief is of course not only being felt in Glasgow. Now that empty rates relief is devolved to individual local authorities, it is being felt in varying ways in different corners of the country. Smaller towns, for example, may not be as economically robust as larger cities. These towns and communities have unique challenges, where smaller projects are not as attractive to larger developers who have the cash to invest. Again, this risks these buildings becoming redundant and falling into further disrepair.

At a time when Scotland needs inward investment, we need to look holistically at how we encourage investor appetite in our towns and cities. We collectively need to question whether short-term gain risks being at the detriment of our city’s heritage and culture, with listed buildings being an important part of the city’s past and the future.

We know that our incredible architecture is a huge draw for visitors from across the world and, while the need for new life within the city is widely recognised, it is vital that a balance is struck between modern investment and historic restoration.

Tony Rosenthal is head of rating and head of Glasgow at CBRE Scotland