London – will it change post COVID?

20th July 2021

Normality is slowly returning to London, but it is a very slow process. Many businesses had their sights set on a 19 June "opening up", but those hopes were dashed when the Government announced a delay in moving from Step 3 to Step 4 until at least 19 July 2021 – so called "freedom day". Was it really freedom day? In theory, now that England moved to Step 4 on 19 July we should see a concerted move back to regular office working and visits.

However, messaging coming from companies is diverse. Some of the major banks (eg Goldman Sachs, JP Morgan) have said that when COVID rules allow, they will require their staff to come back to the office. Other companies (eg Deloitte) have said that they will allow their staff to work from home if they wish to.

How may this affect the demand for office space? The simple answer is that we do not yet know and it will take months and maybe years for the full effect to be felt. Working from home on a permanent basis is probably not an option for the vast majority – that novelty has worn off long ago. Individuals miss the “buzz” of meeting colleagues and businesses lose out on the creativity generated when people meet up face to face.

What will the office space requirements be?

Probably, the eventual plan adopted by most firms will be a hybrid, where they allow some staff to work from home part of the week. What will that mean for office space requirements? It follows that if companies have less staff using desks less frequently then they may need less space. Perhaps they will move to a more agile working environment – the days of an individual having his or her own desk or room are perhaps gone; more efficient office space planning may dictate that companies can manage with less space, but space which is planned more carefully, with more use of open plan arrangements/hot desks and break out areas etc.

The next 12-18 months should give us a good idea as to how the “new world” we live in impacts upon occupier’s space requirements.

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