Only a short while ago, the government was urging office workers to get back to their offices. Now, large swathes of the UK are back in various tiers of lockdown. COVID19 will be consigned to the history books at some point, hopefully soon. Many of its consequences, however, look to be here to stay. Remote working seems likely to be one of them.
Goodbye city centres?
In spite of the doom and gloom headlines, it’s hard to see many city centres being left completely empty. Many of them have attractions which can draw people into them even when they don’t have to be there. What is, however, very easy to see, is a substantial reduction in the number of people commuting into the city centre every work-day.
If some companies pull back from city locations, then there will be less competition amongst those who remain. This could lead to lower property prices (both commercial and residential). It could even open up some exciting opportunities for urban redevelopment. For example, it could see commercial buildings converted to residential use or even demolished to create new, green spaces.
Where will all the businesses go?
The answer to that question probably depends on the business. Many knowledge-based companies will probably transition to either home-working or home-first working. This could well include established companies which have hitherto resisted this change due to security/productivity concerns.
Some companies will genuinely need at least part of their workforce to be on site. They may even expand their presence if property prices reduce enough to make this economically viable. Local businesses may stay to serve the people who remain. Alternatively, they may pull out and develop a new online-only or online-first business model.
It has to be said that some businesses may close down completely. It also has to be said that they may have done so anyway. If a business was already on the edge and/or the owner was thinking about moving on, then COVID19 (and the prospect of Brexit) could prove the final straw. That may be sad, but it is also a standard part of business.
Hello rural development?
Rural development may mean extra housing in rural areas but that’s far from guaranteed. Living permanently in the real countryside definitely isn’t for everyone. It is, however, fairly likely that rural internet access will be improved as that was in the process of being addressed anyway.
It’s probably far more likely that the move away from city centres will benefit less-popular suburbs and satellite towns in the broad vicinity of a city. In other words, it will benefit places where it would be a pain to have to drag yourself into a city every day but fine to pop in every now and again.
So who loses?
Change rarely benefits everyone. In this instance, the biggest losers by far look to be people invested in city centre property. Yields in city centres have long been low, in large part due to the high property prices. It would take very little for them to turn negative with all that implies for landlords (and local councils).
Smaller-scale losers could include any individual or business which depends on the larger companies. This is, however, not guaranteed. If COVID19 has had any silver lining, it’s showing just how necessity really can be the mother of invention.
So who wins?
The big winners are likely to be individuals and companies which can facilitate secure, convenient remote working. This means anything from companies which sell equipment for home offices to companies which support remote team-building activities.
Other winners could be companies which facilitate pop-up offices and the facilities they require. This could also create a lot of opportunities for city centre hotels and leisure facilities. Transport might be an indirect winner since lower demand could allow it to focus on quality rather than quantity.