Architects are perceived as focusing all their energy on design, creating buildings that we feel are iconic and exemplary and that respond to the social and urban environment in which that building sits.
Meanwhile, architecture students are taught to design purely within the parameters of aesthetic, culture, placemaking, history and theory. They generally believe that their real clients are the building, urban environment, community and context and are repeatedly critiqued by academics and architectural theorists on the cohesivity of the proposals. Few architects are ever taught one of the most fundamental parameters of all: viability.
I am not suggesting that exceptional design, placemaking, public realm and culture within a scheme are not fundamentally important; simply that the architectural community needs to do more to enhance their understanding of the other parameters that we need to work within: funding structures, internal rates of return, pressurised land values, economic uncertainty, site efficiencies and the implication on cost for delivery timelines.
The term ‘paper architecture’ is widely used by architects and refers to buildings that have been designed with immense energy from our teams yet never delivered, as they are not deemed to be viable.
Value engineering has become the standard on every project and architects seemingly justify charging for this. The paradox is that the parameters of viability were never accounted for in the design in the first instance.
Architects overlook our role as a professional service provider, a pivotal cog within the wider development framework. We have a duty to act in the interest of our clients, balancing their aspirations with our own.
Pressure on returns
Leading architects understand that the pressure on bottom-line internal rates of return has never been greater. Before thinking about building aesthetics, they test, as our practice does, early massing studies against their own viability appraisal, focusing on net/gross ratios, fluctuating building costs, planning risk and cycle length. This is not achieved at the expense of any scheme’s qualitative cultural impact.
There is also potential to invest the architectural fees in exchange for shares within the special-purpose vehicle, easing pre-planning, sharing in the upside and providing true co-alignment with clients.
Fees can be indexed on net internal area, not build cost. The practice can be treated as an origination platform that capitalises on cross-sector connections between local authorities, landowners, developers, investors and operators.
Architects are privileged – we can subjectively design buildings that are ultimately funded by our clients. However, if our aspirations remain in silo to the funding structures of any given development, we will eventually marginalise the profession entirely.
Architectural education needs to encompass greater understanding of financial parameters beyond the site locale and train architects who can design exceptional buildings that are inherently viable and don’t remain ‘paper architecture’.
Jo Cowen is the founder and director of Jo Cowen Architects and Jo Cowen Capital