Out of office: How we keep central London working for businesses, visitors and residents
The office sector drives the capital’s economic growth. In the last decade, central London – the most attractive and competitive location for business – has seen enormous growth in jobs and office floorspace, and its economy is heavily connected to the eco-system of office-based work. However, the widespread uptake of hybrid working has led to new misgivings about the future of the office and the wider economic health of central London.
Workplace visits to central London are around a third lower than pre-pandemic levels, and as at autumn 2022, office attendance stands at around 40-50% of pre-pandemic levels. Office workers in London look to be returning more quickly than in some cities such as New York, but we need to ensure the city keeps growing sustainably for the benefit of residents, workers and businesses. While hybrid working presents some challenges for the way things have been done in central London, it also presents exciting new opportunities for London to evolve, improving its economic resilience and supporting the well-being of the people who work there. In short, hybrid working can bring the best of both worlds if implemented correctly.
Here are some of our suggestions for how we can help London’s office market to thrive, maintaining its attractiveness for both businesses and workers.
Promote a ‘best of both worlds’ approach to hybrid working.
As office workers continue to work both in the office and from home, employers must embrace and take advantage of the benefits it offers – for employees, employers and wider society. Office spaces in central London should be repositioned as places where people come together for collaboration, teambuilding, networking, mentoring, innovation and inspiration, all supporting economic agglomeration benefits in the wider economy. Home working should be positioned as a place for focused individual work, also recognising how it provides greater flexibility to employees, helping them maintain a positive work-life balance and supporting their wellbeing.
Monitor and respond to emerging market trends.
Working patterns are dynamic and are continuing to change over time. Monitoring changes and keeping stakeholders updated is key for them to be able to take informed decisions. By sharing data on office occupancy as well as approaches to office use policies, organisations can learn from each other and coordinate action for the benefit of both businesses workers and policy makers alike.
Ensure affordable and flexible public transport.
As fewer workers travel to the office five days a week – with Monday and Friday the less busy days – the cost of commuting plays a significant role in office attendance levels. We need to ensure transport to the city centre continues to be both affordable and high-quality, not only to encourage more frequent attendance but also helping to spur greater activity on quieter days.
Protect important commercial properties and support a managed transition to other uses where appropriate.
A rapid and uncontrolled transfer of commercial property to other uses risks undermining central London’s recovery. Commercial stock in important areas should be protected from conversion, while in some areas conversion from office use to other uses might be the best option – particularly in the case of lower quality stock.
Support a more efficient use of office stock.
Office attendance is likely to be lower than pre-pandemic levels in the long-term, so workspaces will need to adapt. There will be an increased focus on quality and flexibility, and there is potential to open up traditional office spaces to local users – such as local charities, community groups and education and training providers – who could make use of them during quieter periods.
Help ensure central London’s office stock meets market needs.
For central London to remain competitive, it needs to offer high-quality, sustainable and efficient workspaces which also meet the needs of businesses in different sectors. To ensure office buildings remain attractive, we must incentivise their use by supporting decarbonisation and retrofitting and ensuring that workspaces provided are fit for purpose.
Protect and enhance the wider eco-system in central London.
Central London is attractive not only as a global business centre but also as a place to visit and live. It offers a thriving culture and creative offer, diverse arts and entertainment activities and unique public realm. We should encourage businesses, the culture and creative sector and the arts and hospitality industries to work together in order to protect the capital’s holistic offer.
All in all, central London remains as the place to be for businesses, but office spaces need to adjust to these new working patterns. From hybrid working to flexible schedules, businesses have different working policies in place, making it a challenge to know the precise future of the office in central London. If we want the capital to keep its position as one of the most attractive and competitive business locations in the world, we all need to work together to navigate change, adapt with ease and thrive in this fast-paced environment.
The report on the future of the office in central London is available here
Alison Murray, Matthew Dillon, and Greyson Clark, Arup – 6.12.22
