Assimilation and Acclimatisation in London Offices

Richard Howard • 24/03/2020
Given the inchoate nature of the COVID-19 situation, last week was a period of assimilation for London offices, with a simple acclimatisation for many to a new way of working for the medium term. 

There is still some activity and the indications are that the larger transactions are proving to be more resilient than the smaller ones, presumably led by the acute supply shortage that predates the current state of affairs. 

We are monitoring all live deals over 20,000 square feet across London where we have reasonable visibility and will continue to update this as a barometer of activity. It is likely to be a highly protean market, with activity occurring in fits and starts as we work through this temporary setback. We will report this activity as it unfolds.

A key concern that was raised a number of times last week is the presumed disruption to the supply chain for construction, and indeed the likely closure of construction sites during the period of containment. This could have significant implications, both for the wider marketplace in terms of an even more acute constraint to the pipeline, and specific instances where a successful pre-letting is contingent upon the timely delivery of the space in question. Our Italian colleagues, where the situation is more advanced, report that this has become a significant factor in their world.

Flexible workspace operators are likely to face significant headwinds in the coming weeks, given that working from home and social distancing run counter to the very essence of their offer, although the disruptions to delivery of schemes may become a positive factor for them as occupiers need short term solutions to tide them over before they can start fitting out their long-term space. Another source of potential optimism for this sector is the increased demand for disaster recovery/emergency space where teams can be split across two sites to substantively reduce the risk of contagion.

Any forecast as to the timing and outcome of the current state of affairs may well not stand the test of time. However, this is a highly unusual situation in that, in previous global downturns, there has been no tangible visibility of when things might change, and there could only be a priority set of loose assumptions. In this instance, though, the general weltschmerz is tempered by the early signs of a return to normality in the countries where the outbreak originated, which gives a glimmer of hope and an ability to make some tentative assumptions about when circumstances will improve.

When the improvement starts, it is our view that activity will resume rapidly, in a market where logic suggests there could be an even greater limitation to future supply. It will be important to be ready for this – for example, when things start to get back to normal, the first viewings and inspections may be virtual. It is highly important therefore that this experience must be available and easy to access and use as it becomes the link to a resumption of the status quo.

blue duotone graphic of people in office
Insights • Economy

EMEA Markets View

Our EMEA local market research colleagues share the latest real estate market views from their countries.
Andrew Phipps • 15/07/2021
high rise apartment block looking up
Insights • Investment

COVID-19 and Alternatives

Investors in specialist sectors such as student accommodation, life sciences, retirement living, data centres, healthcare, co-working, hotels and residential are seeking to understand the impact of COVID-19 on the underlying operational businesses as quickly as possible.

David Haynes • 21/04/2020
arrow engraved in concrete
Insights • Occupier

Occupier Decision Making

As we stop and reflect on what is, for most people, week 2 or 3 of our imposed lock down, a massive call out to all FM teams globally. They have been working flat out to help businesses stay functioning and open where this is necessary, as well as lending additional support to front-line businesses.
Michael Creamer • 08/04/2020
glasses on desk inside skyscraper office looking out at night time city
Insights • Valuation

The Valuer's Perspective

March quarter figures will show a marked downgrading in all sectors bar Central London offices and the best industrial and logistics units.
Charles Smith • 08/04/2020
Knightsbridge, London during COVID-19 lockdown
Insights • Retail

Retail Quarterday Mayhem

As the ‘stay at home’ message crescendos, and lockdown sweeps the world, many sectors are feeling the economic crunch. Without the daily hustle and bustle on our streets, the physical elements of the retail and leisure market are facing a state of economic hibernation.
Paul Durkin • 08/04/2020
black & white young woman eyes raised, smiling
Insights • Commentary

Motivational and Social Shifts

If your past 2 weeks has been anything like mine, then you’re likely to be getting to a place of COVID-19 fatigue.
Richard Pickering • 08/04/2020
ethernet cables in sockets
Insights • Data Center

Data Centres Versus COVID-19

With society under physical lockdown, we have never been more reliant on data centre facilities, as we increase our virtual (on-line) presence.
flexible workspace people working in converted warehouse
Insights • Coworking

Flexible Workspace's Biggest Challenge

Although some flexible workspace operators had not until now weathered a downturn what we learnt from the GFC in 2008 was that demand for flexible workspace in times of uncertainty tends to remain high.
Emma Swinnerton • 07/04/2020
empty hospital operating theatre
Insights • Healthcare

Healthcare Balance of Risk and Opportunity

Never has the healthcare industry been in the spotlight to such an extent and rarely has the interaction between the public and private sectors been so constructive and collaborative.
pillows on hotel double bed
Insights • Hospitality

Hospitality Challenges

Two months ago, the conversations around the UK hospitality sector were focused on exciting new brands, the undisputed positives of long-term global demographic and tourism trends and how best to package product to satisfy the increasing appetite from institutional capital seeking to capitalise on the secure long term income provided by the sector.
Jonathan Hubbard • 07/04/2020
Woman working on laptop in kitchen with glass of milk
Insights • Commentary

Introducing the New Normal

A week is a long time in politics would be a very apt phrase for the current global situation. The change we’ve seen since we shared our last view of the UK real estate market has been dramatic in two ways. 
Andrew Phipps • 07/04/2020
desktop screen at home with iphone with Skype logo
Insights • Commentary

Leadership Resilience

The resilience of our leadership is brought into sharp relief during times of crisis. The nature of the crisis is moot, it’s how people in positions of responsibility respond and the messages they send to their teams, clients, and in the cases of governments around the world, their electorate and the voracious 24-hour news cycle. 
Andrew Phipps • 07/04/2020


office rooftop garden with raised beds
Insights • Office

Rethinking Place

Given the inchoate nature of the COVID-19 situation, last week was a period of assimilation for London offices, with a simple acclimatisation for many to a new way of working for the medium term. 
Richard Howard • 02/06/2020
Future of Cities
Insights • Economy

Future of Cities

The world is changing ever faster. By 2040 our cities will look very different. But how different?

Research • Workplace

Experience per Square Foot™ (XSF)

Gain data and insights to move forward with confidence.
Bryan Berthold • 24/09/2021