As we prepare for those retail shops designated as ‘non-essential’ to reopen, it remains to be seen whether we will witness the type of ‘revenge spending’ that occurred when luxury retail stores first reopened in China or whether UK consumers will be reluctant to emerge from the comfort of their homes and the newly discovered convenience of one click shopping. Selfridges, as always leaders in customer experience, say they aim to encourage us back with a ‘joyful experience’. Additional treats on offer will include personal after-hours shopping trips and for the moment, we won’t have to battle for space with the usual crowds of London summer tourists. And, of course, Selfridges London is dog-friendly so you can take your constant canine companion, so long as he/she is carried at all times, whether in a bag or otherwise. So that probably means small dogs only!
On the subject of retail, we have had the very timely announcement of the new High Streets Task Force to be chaired by Ellandi co-Founder, Mark Robinson who commented, ‘because the task force board runs for 4 years, this initiative really is going to make difference. I wouldn’t have agreed to join if I didn’t think it could successfully deliver much needed change to our towns.’ So watch this space.
This week we enjoyed the digital Property Week Climate Crisis Challenge. This insightful event included a compelling TED talk by Basil Demeroutis, Managing Partner of Fore Partnership in which he advocated a new language for ESG. I was transfixed by his wonderfully colour-coded book shelves which may have contained a subliminal message for us. The event was a call to arms aimed at the real estate sector. As Demeroutis said, to crack climate change we have to look at every building to see where environmental upgrades are possible. As a start, he suggested, we can all look at converting to renewable energy.
Another highlight this week, especially as I could just sit back and listen, was the ULI Europe webinar ‘Beyond the Pandemic - The Future of the Workplace’ moderated by Fifth Wall MD, Roelof Opperman, with industry veteran Mark Dixon, Founder and CEO of IWG /Regus, who has weathered many crises, and Coen van Oostrom, Founder and CEO of EDGE Technologies a ground breaking real estate technology company. In a lively session, Dixon, who said his businesses have a huge 7.2 million users worldwide, questioned the use of the word ‘flex’ saying ‘what companies want is a product and a single supply chain which is not necessarily flex’.
Describing the current crisis as ‘every crisis we have been through rolled into one’, he made some predictions. He said the pandemic had accelerated existing trends so that property will become more of a service industry. Dixon’s big prediction was that over a number of years there will be a dramatic change in leasing. Currently, he said, corporates globally have an average of 98% fixed leases and 2% flex. Relatively quickly, that will reverse to 70% flex and 30% fixed.
The change, he said, will be fundamental and dramatic. That will certainly be welcomed by flex operators. Van Oostrom made the important point that the real estate sector needs to be at the negotiating table. He pointed to the distance between governments and property companies and said that we need to make sure that the sector has a role in the economic recovery.
This week also brought further news of a proposed planning shake up. Communities Secretary, Robert Jenrick has indicated that the Government wants to speed up and simplify planning and make it fit for the future. My colleague Anita Rivera, head of planning at Mishcon de Reya commented, ‘the time it takes for planning policies to be adopted often results in an outdated decision-making framework which doesn’t reflect current market thinking, societal changes and drivers of growth.
The current system lacks the ability to respond quickly and flexibly to acute shocks, never mind emerging trends.’ The prospect of another planning review prompted me to raid the Property Week archives in which I found an article that Sir Stuart Lipton wrote for in September 2011 entitled ‘ Planning reform and sustainable development are our social obligation’. In it he commented that the post-war period had been a failure in planning terms. Writing in the run up to consultation on the National Planning Policy Framework, he said ‘let’s return to the concepts of the past: a village green in every neighbourhood with the civic amenities around it, homes and jobs nearby and neighbour looking after neighbour. Let’s have the planning system restore our humanity, our civility, our work ethic — and fun.’
Some nine years on, you can’t argue with that.
Susan Freeman is a partner at Mishcon de Reya