Responding to various posts on this thread:
Side returns are extremely popular and maximise light and space - square footage (resale value) and useable family space (lifestyle value). We would recommend you consider other improvements at the same time e.g. create a downstairs WC or a utility room, it's more cost effective to have one project underway and consider the cellar tanking, refurbing bathrooms, carpentry requirements, storage etc etc to get best return on your investment in the project (time and money).
Our latest project (on our website & photos below) placed banquette seating around a table against the island, which kept the open flow and feeling of space and allowed the natural brick side wall to really stand out.
There are before and after photos on our projects that show the difference that even a small side return space can make. http://www.clarabee.com/projects/
With leaseholds, as another poster mentioned, more party wall agreements to arrange, with the freeholder and other leasehold owners (not tenants) and assume you have covered off any shared garden ownership issues.
Wandsworth Council produce quite a helpful guide on Party Walls
http://www.wandsworth.gov.uk/downloads/ ... arty_walls