The coronavirus pandemic has radically changed our way of working, prompting businesses to become increasingly agile and footloose – a change in company culture and working norms that would have seemed simply unimaginable just a year ago.
However, while some have misguidedly suggested this could be a death knell for the office, the impacts of home working on productivity, development opportunities and staff wellbeing have continued to show its value. And so, too, would it be erroneous to assume that the approaching deadline on the UK’s Brexit negotiations will create long-term harm for the UK’s commercial real estate sector.
In particular, the UK will continue to have a thriving office market but the key to success will be flexibility and innovation.
The flexible workspace market has grown significantly in recent years. In the UK market alone, there are almost 6,000 flexible workspace centres, accounting for as much as 17% of global supply. In London, flexible workspace is set to account for over 6% of total office supply by the end of this year.
In fact, while the coronavirus pandemic has created undeniable challenges for the property sector, flexible workspace is primed to thrive as businesses look for greater flexibility in their commercial real estate commitments and across their office footprint.
Similarly, the pandemic has shown the importance for employees of being able to access office space on a more flexible basis. Many have benefitted from reduced commuting but the impacts of continued home working are serious cause for concern. A recent survey by our company found that 29% of respondents lack appropriate equipment to work from home while 37% report being unable to unplug from work in their home environment.
Clearly, the office has a crucial part to play in creating opportunities for businesses and people to recover from the pandemic. The value of this remains unchanged by Brexit, regardless of whether a deal is reached in advance of the New Year.
Optimistic outlook for the market
The London market, in particular, has been the subject of much speculation. Some analysts have questioned its future as a global business hub, especially as the pandemic has empowered people to work in more remote and footloose ways.
However, many businesses have made significant commitments to UK office space since the referendum vote, including Facebook and Google. The UK has also continued to build its reputation as a centre for excellence in life sciences, with developments such as a new campus for Imperial College London and Oxford University proving a central contributor in the development of a coronavirus vaccine.
So, despite the uncertainty that a combination of Covid-19 and complex Brexit negotiations has created for the commercial property sector, the UK’s strength as a global beacon for business will remain.
Ahead of the game
However, to stay ahead post-Brexit, the UK office market must continue to innovate its product and service offering. Delivering a range of amenities under one roof – from flexible workspace to GP surgeries, salons, restaurants and accommodation – is just one example of how the sector can ensure it remains resilient for the years ahead.
The office will also play a crucial role in meeting the needs of the next generation of workers, offering the in-person development opportunities that they have sorely missed when working from home.
While Brexit continues to create a sense of uncertainty, the pandemic has also shown the enduring relevance and value of the office. The UK’s cities remain an attractive place to work and its offices a place where businesses can thrive. Regardless of whether a deal is reached in these final stages of Brexit negotiations, the UK’s flexible workspace and serviced office sector still has everything to play for.
Giles Fuchs is chief executive of Office Space in Town