The Future of offices in the ‘new world’
Imagine a force of nature, silent yet deathly nimble, contagious yet perplexingly intangible. And then imagine this force, so powerful, it has the ability to close down 21st century life as we know it; bars, restaurants, shops and …offices. We are, of course, talking about Covid-19.
Declared by the World Health Organization a global pandemic on March 11th 2020, the world has had to adapt. And fast. This adaption has touched every single line of business, including the London office market. Once the virus has passed, which it will, will we ever view the need for an office as we know it in the same light?
WFH vs FTF (face-to-face)
As any company leader will know, the two biggest company expenses are 1) staff and 2) physical location. On Monday 16th March 2020, Boris Johnson urged a national ‘working from home’ (WFH) policy. As the reality of this compulsory WFH policy emerges, what long-term impact (if any) will there be on offices?
The WFH concept is not new. The notion has grown in popularity over the past decade with the rise of the flexible working model which has infiltrated the traditional leasing office market. The emphasis being on the use of ‘virtual desktops’ in order to conduct business. The use of smartphones and laptops has provided companies with the ability to transfer work traditionally carried out in an office to be carried out anywhere. The ability to do so has, undeniably, never been more important.
However, whilst this model has enjoyed a decade of increasing popularity (and in turn snowballing profits), following the enforced closure of office space to protect the health of the country, the global economy is facing unprecedented and catastrophic challenges.
This has shone an undeniable light on the necessity of having a physical presence, the office. Never in our lifetime has the need for face-to-face (FTF) human contact been so excruciatingly apparent. Colleagues, friends, families (and even strangers with the help of apps such as House Party and virtual dating sites) have flocked to various different video platforms in an attempt to emulate the FTF environment. These platforms have been truly business saving (just look at the share price of Zoom over the last 6 months) and further have had a critical and positive impact on employee’s mental health during this difficult and horrible time. We are, by nature, social creatures.
With these platforms however come their own set of challenges. Distractions in the form of home decor, connectivity issues, and adjusting to the blurring lines of business and personal lives (see Professor Robert Kelly’s infamous 2017 BBC interview) are enough to convince anyone that a long term WFH model is unsustainable.
As we navigate the coming weeks and months and enter back into the new uncertain world, one thing is for sure, the need for offices (in whatever which way works for you).
Business’ are undoubtably facing headwinds and will likely look to rationalize outgoings to mitigate these. The first and glaringly obvious way of doing so is to look at physical presence. With intelligent design, the use of improved connectivity and technology and a robust infrastructure allowing employees to work wherever they wish will hopefully help us move closer to truly ‘agile’ way of working. Perhaps businesses may reconsider the need for London office at all. Whatever the rationalizing, the conversations alone could save a business thousands of pounds over the course of a lease.
The team at Daniel Watney are very much open and working hard in advising clients with their property requirements. With input across different business lines including building and fit out, lease advisory, business rates and agency, we are exceptionally placed to help you navigate this new world and the changing face of occupational requirements. Please get in touch if you would like to discuss them 020 3077 3400.