What will be the impact of COVID19 on our city centre business districts – do we need more grade a space, more residential or something different?

What will be the impact of COVID19 on our city centre business districts – do we need more grade a space, more residential or something different?

The Covid19 pandemic has resulted in an extraordinary number of people across the country now working from home. Although some companies and individuals were already well set up to work in this way, most of the population were not. With companies learning how agile working can be effective, will this be the new normal or will we all be desperate to return to the office in 2021?

What type of offices and business districts will we be wanting to return to? Many cities in the UK are lacking grade A office space but with more people working from home, should the investment be made into creating effective working areas within homes instead? What will happen to the grade A office space left empty and under-occupied and should this be repurposed for residential? What should business districts look like in the future?

During the summer Davies Partnership and Paddock Johnson gathered together senior leaders from the Liverpool City Region to debate what our city centre businesses districts need to be, to address changing demand.

With companies learning how agile working can be effective, will this be the new normal?

Pre COVID19 restrictions it was estimated that 70% of companies either had digital transformation projects in place or were working towards one when immediate restrictions meant most businesses had to switch their workforce to home working and make speedy decisions about which technologies would enable work to continue.  Despite this home working did prove effective for most businesses as digital tools were available to allow team collaboration through online sharing of documents and video meetings.

Tony Reddin, Director at Grant Thornton shared; “As a team we’re feeling closer than we ever were working remotely because when we’re sat in the office we sit with the same people and for colleagues further away we would usually email or drop them an instant message rather than go up and speak to them. We’ve instigated a daily Teams call and we’ve had a better insight in terms of more collaborative conversations and insight” 

It was apparent that many medium and large organisations had already implemented agile and home working and for many others it proved that a more flexible approach and trusting employees had been working well and to begin with improved productivity.   It is too early to understand how home working will impact employee performance longer term as 6 months on, home working fatigue sets in and we miss our water cooler catch ups!

With many companies now expecting a full return to the office to be in 2021, indicators are beginning to show that full time working from home is not a practical long-term solution for all. Definitive trends were shared showing that less experienced team members found remote working to be more challenging without the mentoring and guidance of more senior team members surrounding them day to day. Aside from the immediate mentoring and guidance, what seems to have been missed are the collaborations that happen from being in same place and discussing resolutions to problems across desktops and resolving issues through face to face teamwork.

Nurturing culture is difficult to do remotely and as Victoria Alderton added;  “We are not based in the city centre, but in Port Sunlight, in an old converted Victorian school house and  we’ve realised it’s quite a strong part of our identity and if clients aren’t visiting us in our space and if new employees aren’t seeing that space then howdo you help them understand what our organisation’s about.” 

It is important to understand that working from home is far from a level playing field for all team members. Whilst some might have the benefit of a home office, appropriate furniture and a quiet and inspirational space to work in, this really isn’t the case for most. Working from coffee tables and the end of the bed was the only solution for some which not only has a physical impact on wellbeing but means it becomes difficult to separate work from personal lives, creating an unhealthy balance, leaving employees finding it difficult to switch off from work.

Richard Lewis commented; “Research indicates that there are huge regional variations between city centre/office workers that can work from home and those that can’t. For example, 80% of staff working in North East city centres have no choice. Presumably call centres and the like. Whereas in the South East, only 20% are compelled to return to the office.”

Helen Brown added; “From the point of view of a firm of lawyers, and I know this applies across many other sectors and businesses as well, we have to consider issues such as the supervision of junior team members. Learning from more experienced colleagues ‘on the job’ is the best way to learn and that is much more difficult when we are working remotely. At Brabners, we have a policy to deal with remote supervision and we work hard to keep those lines of communication open.”

Interestingly the primary locations and sizes of offices could change.  During the late spring enquiries for office space in Wirral and Southport rose sharply with some companies reconsidering the size of their city centre locations to spread the workforce across different smaller offices, closer to home. Could this also be to support more smaller working bubbles to mitigate against having to send home an entire workforce should one person in the office test positive for COVID19?

Lynn Haime shared; “Our enquiries for the Wirral increased exponentially during the first lockdown. Business managers who have previously been in the city centre have experienced their staff working admirably remotely they are now looking for a smaller base nearer to home for efficiencies such as reduced travel time and better work life balance. There is very much a future for offices due to the need for mentoring and collaboration, but we might find head offices could be a lot smaller and have a different function focused on providing a collaborative space which is client facing.”

It’s not just collaboration in the office that is missed, business districts are hives of creativity and collaboration. The most successful ones are diverse communities of businesses. Some of the best ideas are crafted over a cappuccino and catch up in our network of coffee shops, pubs and restaurants close to the office. COVID19 restrictions and homeworking initially had a detrimental effect on footfall and visitors to some of our best loved haunts. These businesses are the lifeblood of the business district neighbourhoods, shaping places where people want to be and collaborate in.

Kate Ellison shared; “I’m used to working in a city centre location and it’s the popping out for a coffee to meet someone and the environmental element that I miss. I’m totally engaged with lots of different people on Teams all day but I’m in the same room looking at same four walls. The office brings spontaneity of conversation through coffees and different environments!”

Tony McDonnell commented; “We’ve been involved with projects in the Liverpool City Region for 20 plus years but opening our office in Liverpool was definitely one of the best strategic decisions we have made. This has allowed us to tap into a talent pool that wasn’t available to us before and has provided a vibrant and engaging office space for our people to collaborate and share thoughts in, which is fundamental to the work we do “

City centre locations also provide the critical shop window for clients to visit. Some businesses have taken an extra step in by creating hubs where clients can drop in for a coffee and find a quite space to work in the city centre in between meetings to provide added value.

In the short term, some companies are sourcing additional space to allow for social distancing in the office whilst others have opted to operate office rotas or have asked their people to work from home.

Paul Kallee Grover added; “Some aspects of our lives will remain affected so long as the threat of a renewed COVID-19 outbreak remains – but there a number of areas where COVID-19 has forced us to think or act differently – and in the process doing things better. Examples include a reduction in business travel in favour of more effective use of video conferencing, with financial, environmental and social benefits.” 

It was clear that there will always be a need for offices to provide inspirational collaboration spaces were teams can meet face to face and a desk space for employees to base themselves to benefit from good working conditions but that going forward more agile and homeworking would be encouraged to allow employees a better home/work life balance. The panel agreed that we need to take the best of the agile/homework opportunities forward when businesses do return to the office full time. But let’s also prioritise the types of building we inhabit in our business districts, so they can be the best blend of suitable spaces.

Do we need the levels of Grade A office space that are planned?

Taking all of the previous comments into account, how should City Centre Business Districts adapt to achieve the balanced integration of commercial, retail and residential neighbourhoods that future living will demand?

Fatoş Üstek shared; “City centres are the faces of cities, they are the immediate representatives. What the city centre offers as activities, cultural engagement and inspiration contributes to the image of the city. Even though there will be a movement towards the regions or outside the city centre, there need to be a centrifugal force towards the centre where unstructured encounters as well as meaningful engagements may take place. Thus how do we imagine Liverpool, what is the image that pops in our mind now and what do we visualise for the near future with less movement and less interaction?”

Considering the Liverpool City Region is focused on inclusive growth, employment, skills, transport and housing agendas are all central to creating a place that is thriving and leaves no one behind and having a fully developed city centre business district is key to this. The Knowledge Quarter which is core to the Upper Central development of the city has the potential for 2.5million sq ft of development and the Pall Mall development in the City Centre BID alone has planning consent for 400,000sq ft of new commercial space.

Tony Reeves added; “The new Spine Building in the Knowledge Quarter Liverpool is one of the top 4 healthiest buildings in the world. It didn’t cost more to build, the investment was made at design stage to create something world leading, where people will want to work for decades to come.”

Creating world class Grade A space to both entice larger companies to locate in the Liverpool City Region and create collaborative hubs for start-ups and SMEs to be part of the business tapestry has been a priority for not just Liverpool but most Northern Powerhouse cities. With the potential to create hundreds of thousands of jobs upgraded city centre business districts also support the neighborhood of cultural and hospitality businesses that are a critical part of the place shaping.

We can learn from our European neighbours. Paris is developing a 15 minute city project whereby the mayor will split Paris into neighbourhoods where you can access everything you need by bike or walking within 15 minutes. Neighbourhoods will include carefully considered green spaces and no cars!

Grade A space is still a priority and is needed to provide the innovation and standard of collaborative, future proof office space but what needs consideration is Grade B office space and below. Landords and property owners should be using vision to imagine the most creative use for their assets to complement the office space around them and perhaps consider the Paris 15 minute concept!

Bill Addy commented; “The difficulty we have in cities is that building owners in the main look at property as an asset and financial tool rather than as a place for people to live and work. If you only see property in financial terms you have limited vision.”

Long term vision for all buildings is a key issue that needs consideration.  A recent report by Liverpool City Council raised concerns over high risk fractional sales in the city and there have been issues with some high-profile, fractional city centre developments stalling and failing.  Developers can be too short term focussed in their thinking and we want to really innovate the existing spaces in the city, we want to build through inclusive growth which requires long term vision to have a huge impact.

What should city centre business districts look like in the future?

Both offices and city centre business districts need to be reinventing themselves to be relevant and appealing with future working patterns expected to be more flexible working, splitting time between office and home. In some cases, businesses are currently faced with only 20% of employees wanting to return to the office but as hybrid models of what we know as offices emerge into more collaborative spaces based in vibrant neighbourhoods, employees can be enticed back.

Liverpool has long been criticised for having an oversupply of student accommodation, should consideration be given to creating more residential offering for the over 55s in city centres? Our European neighbours embrace city centre living for multi-generational purposes far better than we do in the UK. Could older office space be repurposed to accommodate residential. As a group the over 55s tend to have more disposable income and time on their hands to explore and rediscover the city, visit galleries, museums, theatres and restaurants.

Chris Brown added; “It is so important we breakdown any silos within planning and licensing. We need to create public private debate to innovate and think differently to create an eco-system that captures the essence of communities, supports inclusive growth but also create a leadership structure that innovates and makes change happen.”

In response to COVID19 Culture Liverpool and Arts Council England launched The Liverpool Without Walls Culture Fund, designed to support organisations and artists in creating performance and visual art outdoors. This pilot aims to animate and reimagine Liverpool as a stage, fill the streets with cultural content and encourage audiences back into the city centre to enhance the sense of community and animation within the city centre.

Is there enough high-quality residential offering in Liverpool’s city centre? How do we move cars out and people in? Throughout lockdown the need for apartments to have balconies and outside space, became apparent and highlighted the wealth divide regarding access to clean air and outside space.

Sustainable building and refurbishments should now be a priority. How can more thought be given to using the kinetic energy in city centres, using footfall to power our cities like those developed by Pavegen or the ARTIS gym machines at Cadbury House in Congresbury, near Bristol which each feed around 100w per hour back into the building’s power supply. Plans are in development to embrace Liverpool City Region’s tidal energy, but what more can we be doing?

What do we need to keep and how do we build back better? 

As we continue to navigate our way through the global pandemic and are faced daily with new challenges to overcome, it is clear that our city centre business districts and city centres need to be agile and responsive to the rapid changes enforced upon them.  It will be some months before we return to life close to how we knew it before but critically we need to consider what we keep post pandemic and how we build back better.

Over the summer footfall in the city centre matched levels seen in previous years and during Eat Out to Help Out restaurants were busier than ever. Creative approaches to embracing outside spaces turning them into covered seating areas, making up for the internal space lost as a result of social distancing restrictions were implemented across the city. Small businesses will need to continue using creative ways to accommodate customers during the colder winter months when the hospitality sector could face further short-term closures.

With choppy months ahead for our city centres, support must be given immediately to businesses to help them survive the winter whilst focus should also be given to thinking about what we need to keep and how we build back better. In summary our panel agreed that we needed the following;

Workplaces;

  • we need offices!
  • more grade A office space
  • repurposed grade B space
  • a focus on collaboration spaces within our city centre offices
  • keep the more sustainable approach to meetings, only travelling when you really need and continue to use technology to meet online
  • better and innovative use of kinetic energy and new green technologies to power our offices and cities
  • creative and connected business communities
  • more hot desking (post pandemic)

City Infrastructure;

  • cities where you can live, work and play
  • long term vision for development and a planning system that supports this
  • well-coordinated planning that supports cultural neighbourhoods
  • better public private collaboration and innovation
  • a walkable accessible city that embraces the river and reflects the Paris 15-minute model
  • business districts with a strong sense of community and blend of hospitality, culture, residential and retail
  • better residential offering for all ages in our city centres and business districts to keep them energised throughout the year
  • good transport links to reduce the need for cars
  • inward investment to support a bigger talent pool but only inward investment that truly encourages inclusive growth and brings social value

Mark Basnett ended by adding; “The future, post COVID19, is exciting, but we need quality, we need to be creative and show our creativity through the spaces we create both within our buildings and in our neighbourhoods.” 

Written by Louise Garforth on behalf of Paddock Johnson and Davies Partnership 

Contributors to the discussion hosted by Davies Partnership and Paddock Johnson included;

  • Victoria Alderton, Director at Paddock Johnson
  • Tony McDonnell, Managing Director at Davies Partnership
  • Richard Lewis, Director at Davies Partnership
  • Tony Reeves, Chief Executive at Liverpool City Council
  • Mark Basnett, Managing Director at Liverpool City Region LEP
  • Paul Kallee Grover, Group Planning Director, Leith Planning Group
  • Helen Brown, Partner at Brabners
  • Tony Reddin, Director at Grant Thornton
  • Bill Addy, CEO of Liverpool BID
  • Fatoş Üstek, Former Director of Liverpool Biennial 
  • Chris Brown, Director of Marketing Liverpool
  • Lynn Haime, Head of Liverpool Office at Matthews and Goodman
  • Kate Ellison, Director of Housing Growth & Partnerships at Torus