By John Drover, CEO, Argyll
In August last year, The Sunday Times published this headline: ‘From John Lewis to NatWest, employers bank on remote working’. Publications across the world have shared similar pieces since, reporting on the pandemic’s significant effect on the way we work. But the truth is that for London’s wealth management community there has been no real change.
For them, as readers may well know, flexible working is far from a new concept, as the capital’s finance and wealth professionals have long been working flexibly, coming into the office for meetings or to close deals and working from home on quieter, off-peak days. Since the introduction of Blackberry phones, our deal-and-people-oriented finance clients have been in this rhythm. Their ‘return to work’ post-lockdown is, therefore, a different game.
Buildings that build brands
Many of our clients are boutique financial services firms – for whom, as readers will know, reputation is everything. A client once said to me ‘no one would take us seriously if our HQ was my kitchen table’. Ultimately, a prime central London office address and the credentials that come with it are invaluable to these firms in building and maintaining a reputation. This has only been reinforced by remote working during the pandemic, as working digitally has meant firms have lost the ability to invite clients, investors and recruits into their offices to get a feel for the organisation.
In short, the pandemic has taken a toll on these businesses’ sense of identity. The coming months are about rebuilding relationships with those you have only met digitally in the past two years, so firms need an impressive building with a recognised London address now more than ever.
Within these buildings, an image of communal, open-space areas complete with ping-pong tables can often be associated with the future of the office. Yet, for our clients, its future looks rather different: unbranded, discrete and high-end. In short, for wealth management firms, their workspace must mirror their own identity and the expectations of their customers.
The office must also become a space that emulates the high-end hotel level of customer service, with clients knowing they have somewhere that is accessible twenty-four hours, seven-days a week, with facilities they can rely on.
Flex is nothing new
As mentioned, London’s finance community has always been required to work nimbly, wherever and whenever they need to. A such, interestingly, the pandemic has not driven a demand for greater flexibility within their workspaces. We launched a hybrid working product last year, which received very little take-up from clients. It became clear to us that it is private offices with set desks that are more in demand than ever post-pandemic.
After all, the financial world is underpinned by relationships, so face-to-face communication is essential, and firms are increasingly unwilling to compromise on the quality of communication afforded by a private office where all team members can meet at any time. In addition, for those firms looking to accelerate out of the pandemic, that growth depends upon client meetings, networking with peers and training talent – all things a well-located office can facilitate.
Real estate on the rebound
Sadly, research shows that London’s economy lost £56bn in the first year of the pandemic. However, 2 years on, it is happy reading to see reports that the UK economy is recording its strongest growth since the Second World War. In truth, we now know that a UK-wide ‘recession’ didn’t materialise in quite the same way as the dotcom crash and the Global Financial Crisis, which can partly be explained by the fact that many companies didn’t have to stop operating altogether, rather just take their operations home.
As such, getting businesses back into buildings is an essential part of the UK’s ongoing recovery. Recent research by Savills found that monthly Central London office take-up reached 1.39 million square feet in December, an increase of 32% month-on-month, and almost double the take-up in 2020. At Argyll, we have now returned to pre-pandemic occupancy levels, indicating that our client base of finance and wealth professionals are heading back to their desks on a more permanent basis.
Upon returning to these desks, we have also seen that clients want the highest grade of comfort. Indeed, research from Savills shows that Grade A office take-up currently accounts for nine-tenths of the total. At Argyll, to cater to this post-pandemic demand, we are launching an extensive CAPEX investment programme to restore flagship buildings to their full glory this year.
Building back better
Exiting the pandemic, our clients have made one thing clear: offices have a future for the finance community. That future is about quality and communication; workspaces that allow a firm to build relationships, regroup its team and build a brand, all in alignment with their agile post-pandemic business strategies.