Have we moved beyond cities?
Humans have a need to connect. Social Evolution theory suggests that humans became the dominant species on Earth only because we learned to work together for mutual benefit and protection. Nowhere is this cooperation more evident than in our cities.
Cities have served as incubators for ideas and commerce, enabling innovation by connecting like-minded people together and supplying market dynamics to propel these ideas into the mainstream.
The New Normal
The events of the past couple of months have been tragic, frightening and frustrating for so many. We have all learned something new about ourselves, our families and the people we work with.
At a macro level, this may also mark the end of our fascination with cities. I have spoken to multiple customers and business-owner friends who are now seriously considering whether that flashy office in the CBD is actually a necessity. Many are surprised that they have actually not just survived but thrived in this new stay-at-home reality.
Anecdotal evidence from colleagues suggests that some customers are already actively looking to downsize their city offices and place greater emphasis on home working. The CEO of Barclays, Jes Staley even had this to say about his organisation’s recent experience:
“It’s an extraordinary thing that technology has allowed us to keep this bank so functional, given the fact that 70,000 people are doing it from their kitchens.”
Mug’s Game
Predicting the future is a mug’s game, but I’ve never been afraid of voicing my opinion. At the moment, thanks to the chancellor’s support packages, the economy is defying gravity to a certain extent.
But what could this situation mean for our society and economy in the medium term? Here are my current thoughts:
- Many organisations with City centre bases will be considering reducing their floor space or eliminating their offices altogether. This is already happening
- There will be a huge investment in remote working and Digital Workspace technology. Again, this already seems to be happening. Organisations that have thought ahead and already have a Digital Workspace have been much better prepared for the recent disruption.
- We will see a collapse in the value and demand for City real estate
- Occasional office space offerings, for meetings, events and presentations will see an uptick
- Businesses will instead invest in regional gathering spaces, for smaller numbers of employees to get together for face-to-face meetings
- We may well see many former office buildings being converted into city-centre residential or-mixed use developments, with a glut of properties leading to subdued house-price growth for several years
- Public transport utilisation will drop at an unprecedented rate
- Car usage and ownership will drop precipitously, and multi-car households will start to become the exception
- Many local councils will start to replace business rates with a working from home tax, or even a broadband surcharge, to make up for their lost revenue
- The UK will be able to hit its carbon reduction targets ahead of schedule by moving away from fossil fuels sooner than thought possible
- Local services, provided by entrepreneurial business owners who previous business model has been interrupted, will start to be seen as essential for operating this new work model. These services may include:Home coffee, breakfast and lunch delivery, same-day office supply delivery and cafes and pubs providing quite working spaces
- We may see ‘Non-Returners’, children whose parents have decided that home-schooling is a better option for their child than main-stream schooling. Private tutors may well become more in-demand than ever before, and may start to offer one-to-many virtual classrooms
- A return to more cohesive local communities, as individuals who have previously commuted become more engaged with their local community
Again, these are early days, and it may be that nothing changes after this is all over. I hope though that we all come out of this safely, with a new view of the world and the ability to strike a work-life balance that works for everyone in this ‘New Normal’.