Another step towards a new normal

While the latest step towards the new normal came too late for Debenhams, which closed its doors for a final time on Saturday, it was greeted with a huge sigh of relief by the many restaurants and bars that were unable to reopen until punters were allowed inside again. Ditto the nation’s huggers, who’ve spent more than a year on a strict no-hugs diet and have been throwing Johnson’s “heavy dose of caution” to the wind this week. But there have been no jubilant celebrations. The Covid pandemic has taken too much of a toll on our towns and cities for that, as has become even more evident this week.

The hope was that the restaurants and bars that did not reopen on 12 April would throw open their doors this Monday. Many didn’t, however, and the sad reality is that some never will. While there is much talk of the reinvention of the high street, even if it does happen, it won’t happen overnight. But the good times will roll again and now Covid has taught us what really matters – ‘carbon, communities and colleagues’, as SEGRO chief executive David Sleath neatly puts it – the hope is they will be more sustainable than the good old days.

For all the voids on our high streets, there is cause for optimism. Talking to Property Week ahead of next week’s virtual Industrial & Logistics Conference & Showcase (26-27 May), Sleath gave me a taster of his keynote speech and explained the rationale behind the relaunch of its Responsible SEGRO strategy.

Core to the strategy is a holistic vision of the future in which shed space is not just thrown up on the outskirts of towns or in industrial hotspots but is built in increasingly urban locations and integrated with other uses such as residential. This space should also be as low-carbon as possible and support local communities, argues Sleath.

“Fundamentally, we provide employment space,” he reasons. “We create nice shiny buildings that are going to employ lots of people and we want to make sure that the local community benefits from that. A lot of the people in those communities are living in deprived areas. We don’t want them to be observers of regeneration that’s going on around them but not to benefit from it.”

Sleath makes another important point. While the jury is out on whether occupiers are prepared to pay more for green space, he believes that in the future only the most sustainable buildings will attract investment or premium occupiers. That certainly appears to be the direction of travel. As we report this week, Qatari Diar has just secured a £450m green loan to finance the construction of The Chancery Rosewood, its luxury retail and hotel scheme in London’s Grosvenor Square.

Tellingly, HSBC, one of the five lenders, says the loan will help the bank deliver on its global ambition to facilitate up to $1trn of sustainable financing and investment by 2030. It is not the only one starting to see sustainability credentials as ‘need to have’ rather than ‘nice to have’, as the speakers at Property Week’s Property Finance & Investment Forum on 3 June will attest.

It would, of course, be nice if the new normal featured fewer empty units, but if it is more sustainable and community-focused than the old normal, I’ll take that.