MARSH REPORT FEBRUARY 2019 Sky-high Risk: The Impact of Increasing Tall Tower Construction in the UK MARSH REPORT FEBRUARY 2019
Sky-high Risk: The Impact of Increasing Tall Tower Construction in the UK
CONTENTS
1 Executive Summary
4 On the Rise
6 Heightened Risk Mitigation
11 Mitigating and Transferring Tall Building Risks
11 Political Impact on Future Projects
12 Conclusion
12 References
13 About Marsh
13 About this Report Executive Summary Skylines in the UK, particularly in London, have been undergoing a rapid evolution in recent years. Today, more tall buildings are being planned and constructed Greater focus than ever before, with 438 towers – defined as those with needs to be more than 20 floors – proposed, in planning, approved, or under construction in London, according to the 2018 placed on survey by New London Architecture1. mitigating the
As the number of tall buildings under construction in the UK increases, greater focus associated risks, needs to be placed on mitigating the associated risks, which can lead to project delays which can lead and significant reinstatement costs. to project delays While the forthcoming Brexit changes and uncertainty around building regulations could impact planned projects moving forward, we expect to see this trend continue and significant over the long-term. reinstatement This paper has been designed to highlight and bring greater awareness to the various costs. risks and insurance challenges associated with tall tower construction in the UK.
Marsh • 1 London’s Tallest Buildings, Completed and Planned The graphic below (FIGURE 1) shows a selection of the tallest completed, under construction, and proposed buildings in London. Out of these buildings, 13 are proposed or under construction demonstrating how London’s skyline is set to be transformed over the next decade and the growing trend towards tall tower construction.
The height of London’s skyline remained largely unchanged during the 1980s and 1990s, with only Tower 42, One Canada Square, and the Panoramic being completed at a height of more than 20 floors.
In contrast, since 2000, 110 buildings with more than 20 floors have been built in London, with a further 52 under construction and due for completion over the next three years. The Shard is currently London’s tallest building standing at around 306 metres, followed by One Canada Square and 110 Bishopsgate. 22 Bishopsgate, which is currently under construction, will surpass all but the Shard when completed.
FIGURE London’s Tallest Buildings, Completed and Planned 1 SOURCE: SKYSCRAPER CENTER, marsh.com/insights.
COMPLETED UNDER CONSTRUCTION PROPOSED COMPLETED UNDER CONSTRUCTION PROPOSED
306M 306M 294.6M 290M 300M 300M 278M 278M
239M 240.5M 239M 240.5M 230M 236M 230M 236M 250M 250M 221M 224M 221M 224M 214.5M 219.8M 214.5M 204.9M 204.9M 198.6M 199.5M 199.9M198.6M 201M199.5M 199.9M 201M 190M 192M 192.1M190M 192M 192.1M 200M 200M O ER 1 O ER 1 150M 150M METRES (M) METRES (M) TE TE TE TE A A A A O ER O ER P A A T P A A T
100M 100M T A HARF 1 HARF 1 1 ERSHAFT 50M 50M 1 ERSHAFT 22 MARSH OO HARF E3 E4 CA A R 11 BISHOP A O E CA A A S ARE CIT PRI E T CA A A S ARE OO HARF A1 SO TH THE EA E HA B I I HERTSMERE HO SE O E A S O E ROA O E I E E MS 2 CA A A S ARE E FO A 22 BISHOPS A O THE SHAR SO TH A OO HARF E3 E4 22 MARSH O E A S O E ROA CA A A S ARE O E I E E MS 2 CA A A S ARE OO HARF A1 O E CA A A S ARE O THE SHAR CA A R THE EA E HA B I I 11 BISHOP CIT PRI E HERTSMERE HO SE 22 BISHOPS
2 • Sky-high Risk: The Impact of Increasing Tall Tower Construction in the UK London’s skyline still lags behind global cities like New York, Dubai, and Hong Kong, largely due to London’s historic landscape, protection of landmarks, and building height regulations. However, new construction opportunities available to build higher than ever puts greater focus on the need to mitigate the associated risks as the UK plans its high- rise revolution.*
* Note: Listed data for proposed or under construction buildings is based on information currently available. This data is subject to change until the building has been completed and does not include proposed buildings without confirmed height estimates.
FIGURE London’s Tallest Buildings, Completed and Planned 1 SOURCE: SKYSCRAPER CENTER, marsh.com/insights.
306M 306M 294.6M 290M 278M 278M
239M 240.5M 239M 240.5M 230M 236M 230M 236M 221M 224M 221M 224M TE TE TE TE A A O ER O ER T HARF 1 HARF 1 1 ERSHAFT 1 ERSHAFT CA A R 11 BISHOP A O E CA A A S ARE CIT PRI E T THE EA E HA B I I HERTSMERE HO SE 22 BISHOPS A O THE SHAR O E CA A A S ARE O THE SHAR CA A R THE EA E HA B I I 11 BISHOP CIT PRI E HERTSMERE HO SE 22 BISHOPS
Marsh • 3 “London is in On the Rise the middle of a population boom As the population of London continues to grow, the capital has been gripped by a construction frenzy which that shows no has seen a greater number of taller buildings being sign of slowing planned and constructed. down and it’s important we FIGURE Number of Towers Completed in London 2 2008-2018 look at a range SOURCE: SKYSCRAPER CENTER, marsh.com/insights. of options to achieve both 33 the housing and workspace need.” 2
EDWARD LISTER 1 FORMER LONDON DEPUTY MAYOR OF PLANNING. Number Completed 11 3 3 1 1
2 2 2 1 2 11 2 12 2 13 2 1 2 1 2 1 2 1 2 1
This trend is predicted to continue over the next decade. This year’s pipeline has seen an increase of 260 tall buildings compared to 2014, bringing the current number of those proposed, approved, and under construction to 510, according to New London Architecture (NLA)2 (see FIGURE 3).
The NLA analysis also suggests that living in tall buildings is becoming increasingly accepted as a key part of our housing mix. Over 90% (458) of the tall buildings coming forward are residential and have the potential to deliver 106,000 new homes.
Meanwhile, Mayor of London Sadiq Khan claimed, “our housing crisis is the biggest threat to London’s future,” in the London Housing Strategy 20183, which sets out to remove some of the existing constraints on resolving this issue2.
4 • Sky-high Risk: The Impact of Increasing Tall Tower Construction in the UK It is not just FIGURE Comparison of London Tall Buildings Pipeline 3 2016-2018 the number of SOURCE: NEW LONDON ARCHITECTURE, marsh.com/insights. these projects