COMMENT As the lockdowns of 2020 and 2021 forced commuters to work from their homes, landlords and investors tried to figure out how and when demand for office space would return. The industry turned to a variety of metrics to understand and communicate this – occupancy, footfall, utilisation. All these metrics implied that employees would eventually return to their offices at pre-pandemic levels. But does it really matter if we never again see as many people in their offices on any given day?
When the pandemic hit, at Workspace we began using Wi-Fi log-in data across our centres to track utilisation, following how many people were using their offices each day. It became our most closely tracked indicator of the recovery of demand for office space as the economy began to reopen. It came up repeatedly in conversations with analysts and investors. Throughout this period, there seemed to be an assumption that the ultimate goal was to get back to pre-pandemic levels of utilisation. For some, anything less than that would mean a fundamental – and potentially permanent – change in demand for office space in London.
Most of the conversation about the return to work and the future of the office in London has centred on larger corporates, even though small and medium-sized enterprises employ half of London’s private sector workers. Usage across our portfolio has recovered strongly, peaking so far at around 70%, illustrating the enthusiasm that SMEs have shown for returning to our offices. This stands in stark contrast to the desolate offices of larger corporates, where teams have been much slower to return. However, the much more important figures to note are demand and occupancy – the proportion of our total lettable space that is let – which now sits at 89.6%. This is a reassuring sign that SMEs’ demand for office space across London is showing no signs of waning.
The new prime
It’s not how much time you spend in an office that matters, it’s how productive and enjoyable that time in work is for people. Business leaders should not only accept this, they should embrace and facilitate it.
In practice we have found this means three things. Firstly, hybrid working hasn’t made the office any less valuable – to employees or businesses – but it does mean businesses need to be given the flexibility to set up their spaces so that they prioritise what people value most. Creating a fulfilling and productive environment that fosters collaboration, creativity and culture is essential. We have found our customers increasingly value natural light, spaced out desks, creative meeting spaces and vibrant, informal common areas and cafés to socialise in throughout the day.
Secondly, the daily commute is one of the most important factors for people who are on the fence about working from the office rather than from home. Offices close to good public transport options are now “prime” – regardless of whether they are in Southwark, the City, Islington or Shepherd’s Bush.
Finally, there is no one-size-fits-all approach to hybrid working. Therefore, there is no direct correlation between the number of people using an office each day and the space needed to make it a productive, collaborative place. The onus is on companies to make their office a place people want to be – not necessarily every day, but whenever teams need to work side by side on collaborative or interactive tasks.
Volume versus value
Many people predicted that the pandemic would lead to a fundamental re-evaluation of the role of the office in our working lives. And to some extent, they were right.
But what isn’t true is that this re-evaluation has led to businesses deciding they need less space, even if fewer people on average are using the office each day. Larger corporates have finally woken up to what SMEs have known for a long time – the value of an office is not in how full it is, but in how stimulating and enjoyable it is for the people who are there.
Will Abbott is chief customer officer at Workspace Group
