London is still seen as the hub for the best talent in the field, but it is likely we’ll see a shift to look beyond the capital and open up to the knowledge and diversity of talent across the country.
For businesses that have seen London as the be-all and end-all, paying a premium for a prestigious address, the growth of working from home and the realised potential of utilising tech has humbled this hard-lined stance.Julian Adams, Senior Consultant - Manchester
Working from home and the opportunity to downsize offices: will Real Estate move away from London?
When you hear news that the government are looking to move out of London, and thinking about having regional bases, you know there is an air of change coming about. They themselves are looking at Cumbria or Lincolnshire, both quiet rural outposts on opposite sides of the country. If significantly reduced rents are a motivator, no doubt their office costs are more than halved compared to staying in London (average rent of £58.49 psf versus £16.08 in Cumbria – CoStar, November 2020).
For private businesses that have seen London as the be-all and end-all, paying a premium for a prestigious address, the growth of working from home and the realised potential of utilising tech has humbled this hard-lined stance.
The pandemic has yet to settle so we cannot accurately predict how companies will adapt long-term. Commercial entities will likely remain London-centric due to the ability to develop business and have an easy hand to the market. Staff, even the minority that will remain fully remote, still require a centralised location for the occasional meeting when things settle.
Property companies aren’t making big, long term decisions- yet
For the time being, we are seeing a lot of national businesses adopting a satellite office/home-based structure for work. The pandemic has allowed companies to experiment with how remote working can benefit them and if it will work for them in the future.
We’ve seen businesses now bringing in strong professionals in locations that usually wouldn’t have worked due to commuting. They now have the ability to find talent from further afield with the need for them to collaborate 1-2 days a week in an office environment.
On our research conducted 52% of businesses are looking to make changes to their usual office practice, and according to another article only 7% of people would return to the office full time. This is likely going to have an impact moving into 2021, with demand for office space decreasing.
London is becoming less attractive to professionals
There are real estate professionals looking to move back to the regions, some to be close to family and because it is undoubtedly a cheaper living option. It would appear the London lifestyle (as told by professionals we’ve been in contact with) isn’t the same with lockdowns and stricter measures. I believe that the flow of professionals moving more regionally will increase to some extent.
However, when things are back to ‘normal’ and WFH is implemented under normal circumstances, there is still a certain amount of fear and insecurity about asking for permanent remote working and moving roles closer to home. The economy has taken a hit and job security is an understandable fear.
Has remote working opened new talent pool opportunities?
Is there an increase in applicants that live outside of London for remote roles?
From what we’ve seen so far, not so much - for now.
It is something we are expecting to pick up when the world is a little more ‘normal’ and more companies plan to offer remote working options. There does seem to be a raft of people who are unsettled and tired of London but not quite ready to jump ship unless their perfect role comes up. These tend to be the people who relocated to London initially for work and now feel that things aren’t the same; they are paying a premium to live in London but aren’t able to take advantage of the city lifestyle at present.
There is a desire to be able to work closer to home, but the ball is in employers’ hands.
Places to watch - top UK cities for Real Estate professionals outside London
No big surprises here, but the three key cities to keep an eye out would be:
Coming from Manchester, I may have a slight bias but I’m proud of the work that is going on in the city centre. Each of these cities is privileged to have creative, excellent developers who strive to improve their own communities and deliver fantastic projects. I could list several developers in each of these cities to commend the fantastic work they are doing.
There is seismic regeneration going on in cities across the UK and that can lead to more professionals moving to escape London living costs and businesses relocating/having a northern outpost. One will feed the other.
It’s a chicken-egg scenario on who will make the first move, but we can say that change will be about.
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