Commercial Property Landscape in 2021

Last year, everything changed.

The way you work, how you socialise, holiday and meet loved ones, all changed overnight and, according to the doomsayers, life will never be the same again.

We’re not so sure.

Working from home has, for some, been a positive experience that saw their productivity soar. They loved not having to fight traffic or rub shoulders on crowded tube trains during the twice-daily commute and revelled in the flexibility that working away from their office gave
them.

Even once the first lockdown was eased, and there was a limited opportunity to return to the office, the new homeworkers didn’t leap at the chance. Will the City see tumbleweed blowing down its empty streets, collecting in the doorways of boarded-up office blocks?

Jones Lang LaSalle Commercial Property Research analysed a survey of over 2,000 office workers across ten countries and spanning all the major industries. The results blow away the assumption that working from home will be the new normal.

The pandemic has forced people to focus on what matters in their lives – a better work-life balance, access to green spaces and areas that allow for collaboration and engagement with co-workers.

The survey also identified that most respondents believe that certain crucial activities are best done in the office rather than elsewhere. These include:

● Solving work-related issues
● Collaborate and run meetings
● To manage or be supported by managers.
● Learn and grow
● Socialise

An earlier report Jones Lang LaSalle authored – Their Human Performance Report found that 64% of millennials missed the office and 80% of high performers missed the office greatly during lockdown.

Though many employers may have adopted hybrid working it hasn’t stopped the expansion of office space for some large multinationals like Google who are expanding their London office, adding 70,000 sq. ft. to its London HQ. Amazon is also expanding its office space internationally.

To attract and retain high performing employees, companies need a London HQ. They may be looking to cut costs, but they still need high-end talent to be successful.

We carried out our own research in 2020, which showed how landlords responded to the changing environment with the view being it is very much a tenant’s market.

Ricky Au, Sun Venture chairman, said ‘ 1 and 2 New Ludgate are best-in-class assets and we are pleased to have them in our portfolio. London remains attractive to investors taking a long-term view.’

Office development over the next couple of years in London’s West End is looking strong, partly due to some completions being pushed into 2021 caused by the pandemic lockdown delays. Refurbishment and fit-out of older properties are also, according to the Statista Research Department, continuing apace with over 2 million square feet projected to be refurbished in the West End alone.

The challenges of 2020 have potentially changed the commercial property development landscape, however, challenges present opportunities; the adoption of hybrid working practices moving forward will change how office spaces are fitted out in the future with even more emphasis on flexibility and wellbeing. Companies/organisations looking to downsize or reduce their portfolio creates opportunities for other uses for surplus office accommodation not previously thought available.

Though the hospitality and restaurant sector has been amongst the hardest hit, this is one area that the pandemic has evidenced that we all still crave, so there will be new beginnings and for the survivors and entrepreneurs’ new deals to be done with their landlords and ready-made spaces available to occupy. The sense of community has been re-ignited, so how can the positive stories of the lockdowns be harnessed to reinvigorate retail offerings and what will the store of the future look like? We are proud to be working with Browns who are pioneering the retail experience for the store of the future.

Whilst 2020 is certainly a year we are glad is over, we are primed and ready to assist our clients to face head-on the recovery mission in 2021 and to support new beginnings to make our buildings and spaces vibrant and fully occupied again.

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