Two years ago we were all entering a great debate, one that divided opinion of a need for a physical workspace in a post-pandemic world. Now, armed with knowledge of how the workplace is speedily evolving and initial speculations aside, occupier confidence is finally recovering and we’ve experienced a huge appetite for returning. People now want to be back, even though the traditional function of the office may have shifted.
The pandemic backed business leaders into a corner, forcing them to reassess their workplace, understand what it means to them now and the new role it will play for their business. It also had an immense impact on our industry; something initially frightening for the sector but has since pushed the pedal on innovation and shaped what the future of work might look like for us all. From four-day working weeks to meetings in the metaverse – it’s a revolutionary time that’s only going to continue to evolve.
Hungry to be back working in environments more appealing than kitchens and makeshift home offices, it’s been refreshing to see market activity levels steadily rise. Last year, EGi reported 15m square feet of commercial space was transacted across core central London submarkets whilst British Land Co reported London businesses committing to leasing 819,000 square feet of new space in the second quarter of last year – their busiest period in more than a decade.
At the end of 2021, JLL identified 8.5m sq ft of active demand for new office space across central London this year, signaling a positive, and continued, demand for commercial space and occupiers commitment to the physical workplace in 2022 and beyond.
Demand has, however, coupled itself with desire for quality Grade A space. Occupiers are beelining towards energy efficient buildings with amenities and wellness considerations as ESG targets become more ambitious and workplaces need to offer more. The challenge tenants now face is the supply of Grade A space in the market itself as available stock struggles to keep up with rising demand.
For landlords, this presents opportunity to reposition existing London stock, whether that’s through small refurbishment works such as our Grey to Great programme, or part of the retrofit revolution, landlords should seek to unlock the potential of existing buildings and add value in order to meet the contemporary standards of comfort, flexibility and efficiency.
Our recent project for Mayfair Capital is a prime example, having invested £13.3m in the complete refurbishment of 43 Church Street West, now known as Forge. It’s repositioning focuses on creating a design-led and sustainable workplace for creatives, innovators and leaders, keeping user experience at the heart of the transformation.
The project – a collaboration between Mayfair Capital, V7 Asset Management, Hawkins\Brown and Thirdway – comprised a part atrium infill, full internal and external refurb, and a Cat A+ fit-out of the tired, almost-80,000 sq ft office block.
For occupiers to reap the rewards of having a physical workplace requires it to now be designed in a way that’ll help foster culture just as much as it needs to support the demands of a hybrid workforce. With flexibility in mind, we saw clients reduce desk space by up to 40% in 2021 as they continue to pivot to more open-plan and carefully curated environments made up of collaborative spaces, hot desking spots and team-focused areas. Tenant space will continue to adapt to meet the needs of those that use it while finding cutting-edge ways of connecting them to those that don’t.
Having worked in the industry for 20 years and have experienced the market change significantly during that time, I’m pleased to see the need for physical workspace be in such high demand once again. I look forward to seeing projects of our own develop as tenant demands continue to evolve later this year and we discover new and unconventional ways to create exceptional spaces.
Great design now lies at the heart of the future of work.
While we are, first and foremost, interior designers, we also see ourselves as tenant engagement specialists. We work with forward-thinking landlords and insightful developers to deliver a better solution for businesses, ensuring the product attracts the right type of tenant.
If you’re assessing your commercial real estate portfolio for 2022 and beyond, get in touch with myself, or Thirdway for a chat.
We are the pioneers of Cat A+ completing our first tenant-ready space in May 2017, uniting the demands of landlord and occupier by enabling businesses to move out of co-working.Download our Cat A+ credentials
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