How to put people in their place

The call centre sector presents new opportunities to those with the vision to integrate demographic, technological and labour market trends with property development. Stacey Meadwell reports Call centres excite surveyors. Home shopping, help lines and telephone banking are the vogue in an increasingly hectic society, and businesses know it. They seem to be the solution to many a development agency’s problems, bringing jobs, investment and regeneration to areas that are in need. These new developments present a new set of criteria for their property requirements. Call centre occupiers are generally not tied to a particular area and, as English Partnerships puts it, you can replace the mantra “location, location, location” with “workforce, workforce, workforce”. “There is not much difference in rents among the call centre areas, and occupiers tend to be fairly footloose,” explains Mark Swallow of Knight Frank in Newcastle. Demographics are the most important factor when an operator is choosing locations. This is not surprising as staff are the biggest expense, with training costs of as much as £6,000 per operator, according to English Partnerships. Grants are the determinant Steven Gay of Gooch Webster in Glasgow believes that areas with the best grants, such as Glasgow, Liverpool and Newcastle, are also strong call centre locations. However, Healey & Baker’s Adrian Hill says: “Grants and incentives would not outweigh poor demographics.” Certain areas of call centre clusters are overheating as labour pools diminish. English Partnerships’ South West office reports: “Churn rates are up to 25% in some areas and competition is also leading to wages spiralling.” Jeremy Brookes of GVA Grimley says there is evidence of this in Leeds, Bradford, Swindon and Dublin. BP chooses Aylesbury According to Mark Andrews of FPDSavills, this is why BP rejected the call centre Meccas and chose Aylesbury instead. There are plenty of alternative sites which are increasingly being targeted. Jago Bret of Lambert Smith Hampton in Belfast says that Northern Ireland is an increasingly attractive location as Dublin comes under pressure from staff availability and churn. Brookes lists south Manchester, Merseyside, Kent and the East Midlands as a few of the areas with potential. The industry is not standing still, though. Technological advance is making it possible to link call centres around the country. Jon Abrahams, customer services director of SSL, says: “The advantage of this approach includes the fact that all your eggs are not in one basket in case of a failure or disaster. Also, the call centre is not reliant on a single pool of labour.” Richard Ellis St Quintin’s Jeff Pearey, in Leeds, believes the growth market will be in smaller space. Brookes says that size is already coming down, with 2,787-3,716m2 (30,000-40,000 sq ft) the most common requirement. Smaller developments foreseen There are further implications of technological advances. Chris Harris, managing director of telecommunications company Inter-Tel, says: “Despite the increase in the number of calls routed through call centres, teleworking technology is set to reduce the size of future development and will enable existing medium-sized centres to cope with increased volumes of traffic.” More important, as required sizes diminish there will be more locations to choose from. Brookes believes this will open up opportunities for smaller towns like Salisbury and Weston-super-Mare. Pressure to reduce car usage, through restrictions on parking, will also influence occupiers’ decisions, because call centre businesses are often perceived as business park occupiers. Swallow believes there will be more focus on sites with good public transport links. Andrews says: “Companies will start looking at locations closer to towns and cities.” How to reduce car travel However, Peter Halford of Weatherall Green & Smith believes the transport issue is yet to be cracked because “a high proportion of staff prefer to travel by car”. Call centre operators are beginning to realise the importance of providing staff with adequate facilities, and a location close to town-centre shops could provide ammunition for staff retention. “Occupiers have been forced onto business parks because of a lack of available stock,” says Brookes. “They want to be in city fringe areas on brownfield sites. They want their staff to be able to walk to work or be close to where they live.” Bill Lynn of Storey Sons & Parker in Newcastle says that city centres are “the preferred choice of international companies who need access to language graduates and prefer stylish office accommodation”. The type of building used by call centre operators is also influenced by time limitations. Anthony Phillips of Tees Valley Development Co says: “Times for getting established are getting shorter, and companies want to be operational within six months – no time for design and build.” However, a speculatively built unit, while lettable in a desert of alternative space, is not always the answer. Fussy about fit-out Call centre occupiers are notoriously fussy about fit-out and have been known to rip out fittings in speculatively built units. Gooch Webster’s Gay says: “Developers must have an eye for the call centre market. It is not a case of having a shed and sticking windows in it.” The answer seems to lie in shell and core – a strategy used by Akeler at its successful Doxford Park development. Swallow says that this has to be the way forward and Guy Marsden of Highbridge Properties agrees. “Each occupier has specific requirements and each call centre is different, so buildings have to be flexible. They are required quickly and the best way is to have them ready,” he says. Mike Henry of King Sturge in Bristol believes that flexibility is important for other reasons: “Many call centre operators are increasingly contract-led. Seven to 10 years is often normal, and it is important that the building can be adapted to other uses.” However, Brookes points out that it is not always easy to get the shell and core right: “It is often cheaper for a developer, rather than the tenant, to do a category-A fit-out.” As the call centre sector develops, some people believe it is time for the industry to educate itself. Healey & Baker’s Hill believes that agents must adapt and respond quickly to a fast-moving market. Brookes agrees, adding: “You can’t just bolt call centres on to the office sector. Occupiers are footloose and you have to have full UK and European coverage.” South East The South East appeals to a variety of operators Town/city Number of employees grouped by size band Number of call centres Ashford 100-200+ 2 Bexhill on Sea 100-199 1 Brighton 200+ 1 Haywards Heath 100-199 1 Hook 100-199 1 Horsham 100-199 1 Hythe 100-199 1 Maidstone 100-199 1 Milton Keynes 100-200+ 2 Reading 200+ 1 Southampton 200+ 2 Total:   14 The figures on these tables reflect only major call-centre operators employing 100+ staff Source: GVAGrimley West Midlands West Midlands has yet to attract big call-centre operators Town/city Number of employees grouped by size band Number of call centres Coventry 100+ 1 Stratford upon Avon 200+ 1 Total: 2 Source: GVAGrimley Wales Cardiff is the favoured city in Wales Town/city Number of employees grouped by size band Number of call centres Cardiff 100-200+ 5 Newport 200+ 1 Swansea 100-199 1 Total: 7 Source: GVAGrimley North West The North West is dominated by finance and banking call centres Town/city Number of employees grouped by size band Number of call centres Cheadle 200+ 1 Chester 100-199 1 Crosby 100-199 1 Lancaster 200+ 1 Liverpool 100-200+ 3 Manchester 100-200+ 8 Prescot 100-199 1 Preston 100-200+ 2 Warrington 200+ 2 Wythenshawe 100-199 1 Total: 21 Source: GVAGrimley South West Small towns such as Weston-super-Mare have potential Town/ city Number of employees grouped by size band Number of call centres Bournemouth 100-199 2 Bristol 100-200+ 3 Exeter 100-199 1 Swindon 100-200+ 3 Total: 9 Source: GVAGrimley Yorkshire Leeds is becoming a call centre hot spot Town/city Number of employees grouped by size band Number of call centres Bradford 100-200+ 3 Harrogate 200+ 1 Leeds 100-200+ 13 Sheffield 200+ 1 Wakefield 200+ 1 Total:   19 Source: GVAGrimley East Midlands East Midlands is a potential growth area for call centres Town/ city Number of employees grouped by size band Number of call centres Leicester 100-200+ 3 Lincoln 100-199 1 Northampton 100-199 2 Nottingham 100-199 2 Total: 8 Source: GVAGrimley Scotland Financial services and out-sourcers favour Glasgow Town/ city Number of employees grouped by size band Number of call centres Dunoon 100-199 1 Edinburgh 100-200+ 3 Glasgow 100-200+ 7 Greenock 200+ 1 Uddingston 100-200+ 2 Total: 14 Source: GVAGrimley   North East The North East attracts customer service call centres Town/ city Number of employees grouped by size band Number of call centres Middlesbrough 100-199 1 Newcastle 100-200+ 4 Sunderland 100-199 2 Total: 7 Source: GVAGrimley Greater London Market research companies favour the capital Town/ city Number of employees grouped by size band Number of call centres Alperton 100-199+ 1 Croydon 100-200+ 2 2 Borehamwood 100+ 1 Bromley 100-200+ 2 Harrow 100-199 1 Enfield 100-199 1 Hemel Hempstead 100+ 1 Hounslow 200+ 1 London 100-200+ 7 New Barnet 100+ 1 Surbiton 100-199 1 Watford 200+1 1 Total: 20 Source: GVAGrimley