Building resilient workspaces

Workspace and co-working in particular remain an important part of London’s landscape, contributing both economic and social value. Following the success of Future of London’s 2016 programme, Workspace that Works, FoL has returned to the evolving issues around workspace, this time focusing on building resilience and managing tensions. Our half-day conference on 23 January explored the state of the market, the social and economic value of workspace, the implications of the GLA’s pilot accreditation scheme and, most importantly, how we can deliver resilient workspaces that work for London’s future.

Reworking WeWork: what’s the future for flexible workspace in London?  

Keynote speaker Chris Dunn, Cushman & Wakefield, has been tracking the evolution of co-working and flexible workspace in London for the past five years. Despite WeWork’s widely reported IPO collapse, 2019 was a record year for flexible workspace in central London. So what’s driving the demand?

The short answer is: occupiers. “While lots of landlords are keen to become more involved in this relatively new market it’s the occupiers who are currently leading the charge for more flexible workspace”, says Chris. Occupiers – and their employees – want more flexibility in terms of price and lease length, but also sustainable spaces that boost well-being and provide opportunities to scale up or partner with other companies and organisations.

What they don’t want is more of the same. “While flexible workspace on the whole is still in its infancy in London, the capital is saturated with generic co-working spaces,” points out Chris. Although it’s WeWork’s struggles that have been dominating the headlines, they’re not the only workspace operators experiencing difficulties – and Chris attributes this to the fact that too many of the middle-tier operators have been offering too similar a product. “Price and location are no longer enough to guarantee success,” he adds.

Chris Dunn, Cushman & Wakefield, talking about commercial workspace
Chris Dunn, Cushman & Wakefield. Source: Future of London. 

(Re)valuing workspace

Chairing the first panel, Amanda Robinson, Future of London, invited panellists to reflect on how we value workspace beyond financial cost; how we measure that value; and what role local authorities can play in creating socially valuable workspaces.

As Chris pointed out, it’s no longer just start-ups and microbusineses that want flexible workspace. “In a recent survey of 100 top c-suite executives, we found that, on average, they expect 30% of their floorspace to become flexible workspace in the next few years”, explained Michael Davis, JLL. For larger corporations, who favoured more traditional workspace in the past, flexible workspace is a way of driving corporate innovation. They see the value of being located with, or near to, smaller, more nimble organisations with whom they can share ideas and technology. And corporate innovation vehicles, such as Plus X’s innovation hubs in Brighton and Hayes are tapping into this, by bringing large firms into areas with some existing industry or innovation and encouraging creative collaborations. “Corporate innovation is on the rise”, says Michael, “and when it’s done right it can stimulate regeneration.”

“Economic and social value go hand in hand”

Matthew Dibben, LB Brent, offered a perspective that’s sometimes overlooked in discussions about the capital’s workspace market, that of the outer London borough. In two new regeneration projects around Harlesden and Stonebridge, the council has been taking a more “interventionist approach”, engaging very closely with the community to find out what sort of workspaces residents would like. While building housing would have been more profitable on certain sites, such as the former Picture Palace pub, the council has taken a leap of faith and is trying to deliver affordable workspace that the community actually wants.

For affordable workspace providers, building relationships with both local communities and local authorities is key to creating workspace that provides community services. Cross-sector partnerships have been at the centre of the success of Stour Space, a community hub providing affordable workspace for the creative sector, explained Juliet Can, co-founder of Stour Space. By building relationships with local authorities from the outset, Stour Space has been able to secure a long-term lease and get involved in the conversations about the regeneration of the area.

Panel on building resilient workspace
(From left to right) Amanda Robinson, Future of London; Michael Davis, JLL; Frances Holliss, London Metropolitan University; Matthew Dibben, LB Brent; Juliet Can, Stour Space. Source: Future of London. 

Invisible workspaces and the need for more data

Frances Holliss, London Metropolitan University, urged local authorities and policy makers not to overlook home-based workspaces. For many people, their home provides a low-cost workspace and Frances estimates that 4.2m people in the UK (14% of the population) now work from home, making a major contribution to the economy. But the home as a workspace is largely invisible in our cities and neighbourhoods so local authorities don’t design or develop policy for it.

One of the reasons why the home tends not to feature in debates and policies about workspace is the lack of data about home-based work. Starting to collect data on where these workspaces are in London, as well as who these workers are, would be useful. More data is needed about community-driven affordable workspaces too, says Juliet, but these sorts of workspaces often don’t have the resources to measure their impact. She sees an opportunity for local authorities or local universities to collaborate with affordable workspace providers to gather data on their social impact.

Recognising and rewarding affordable workspace operators

The rise in business rates in 2016 has had a hugely detrimental effect on small, independently run coworking spaces. In response to this affordability crisis, the GLA has launched a pilot workspace accreditation scheme. “The aim of the scheme is to recognise and reward workspace operators that offer affordable workspace and deliver positive community and economic impact,” explained Alison Partridge, One Tech – Capital Enterprises, who is coordinating the pilot.

Working with eight boroughs and 12 workspaces, Alison and her colleagues are running the pilot over the next six months. To gain the accreditation, workspaces must show that they meet certain criteria, such as affordability and community impact. One of the challenges of the scheme is ensuring it can work across London but be flexible enough so that each borough can make it work in their local context.

If the pilot’s a success, the hope is that the scheme will become a metric for what ‘good value’ means in the workspace context, particularly when it comes to planning decisions and S106 agreements. “Of course, there’s still a demand for WeWork and workspaces like it,” said Alison, “but diversity is the heart and soul of London’s economy. The accreditation scheme will create space for smaller, more accessible and more affordable workspaces.”

Caroline Wilson and Blossom Young discuss building resilient workspace
(From left to right) Caroline Wilson, LB Islington and Blossom Young, Poplar HARCA. Source: Future of London. 

What can workspaces do to remain resilient? 

In light of WeWork’s recent difficulties, Nicola Tilbury, Potter Raper, asked the second group of panellists what workspaces – both commercial and affordable – can do to remain resilient in the face of future uncertainty. Several panellists stressed the importance of thinking long term, both in terms of the way workspace is designed and the types of workspace that developers and local authorities are providing. Yvette Bryan, Trowers & Hamlins explained that investors who want to get involved in flexible commercial workspace will have to spend more on maintaining buildings because new tenants will have different needs – but it’s better to spend that money at the outset rather than retrofitting the building further down the line.

With regards to affordable workspace, both Blossom Young, Poplar HARCA and Caroline Wilson, LB Islington, recognise the need to work with developers to make sure there are ‘grow-on spaces’ for the people that are currently using incubator or coworking spaces to get their businesses started.

“Resilient workspaces draw on local context and build on what’s already there,” said Blossom. The Leaside Fashion and Creative Cluster, a long-term project that Poplar HARCA has undertaken to return design and manufacturing to Poplar and the Lower Lea, draws on the East End’s long association with the fashion industry and garment production.

Similarly, LB Islington’s affordable workspace strategy focuses on getting residents involved in the local economy. To this end they are working with workspace providers to incentivise them to use local supply chains and encourage them to go into schools so that young people see what sort of opportunities they have in the borough. “Putting local people at the heart of our workspace strategy will not only make workspaces more resilient; it will make our communities and environment more resilient too,” said Caroline.

Jack Fortescue, Acme, building resilient workspace
Jack Fortescue, Acme Studios. Source: Future of London. 

Securing affordable workspace for creatives

Between 2015 and 2018, London lost 17% of its studio spaces. “Rising rents means that many of London’s artists and creatives are struggling to find, and then remain in, workspace”, says Yves Blais, WorkWild and Creative Land Trust. And when artists do find an affordable workspace, more often than not they only secure a short-term lease. Yves is part of the team setting up London’s first Creative Land Trust, an independent charity that will secure permanent and affordable workspace for artists and creatives.

For Jack Fortescue, Acme Studios, a resilient workspace is an affordable one. Acme Studios is a charity that manages genuinely affordable workspace for artists. ‘Affordable’ for Acme Studios is based on local incomes rather than market rates. “There are a lot of parallels between affordable housing and affordable workspace,” says Jack, “But local authorities don’t have as much knowledge about the range and diversity of affordable workspace as they do about housing.”

All the panellists agreed that taking a collaborative approach is key to building resilient workspaces, whether they’re commercial or affordable, for businesses or for artists. Investors, developers, workspace providers, tenants, local authorities, housing associations, local businesses and community groups all have a valuable role to play in the future of London’s workspace.

To find out more about Future of London’s workspace project, take a look here. Resilience is also a key theme in our major programme Achieving Net Zero.