Sandra Jones of Ramidus sent me the recently completed London Office Policy Review (LOPR 2012) the other day. As she always does, every year. Being interested in "all things London" I dutifully printed it off. As I always do, every year. And then I've spent the past few days wrestling with the aforementioned review. As I do, every year. There are reams of it. And it's...er...technical. But I needed to get to grips with it, the LOPR is a venerable institution; it's been going for yonks and yonks and is the best indicator going on trends in the London office market (and shhhhh! potential economic growth).
The wider context for this report this year is interesting. We live in interesting times. For some time now I have maintained that the London Plan safeguards (or denies, whichever way you look at it) London from the policy of localism, being essentially a centrist document. This meant that it could provide an interesting contrast to the rest of the country. But clever planning types are now saying that the last UK wide planning reforms also fundamentally challenge the localism agenda. It is now nearly a year since the act received Royal Assent and became law, enabling local neighbourhood forums to be established that can make neighbourhood plans. There are a few, very few, groups in London who have seized the opportunity to make plans but, for the majority, there are signs that the complexity and cost of the process puts it firmly in the "too difficult box". Does this lack of progress on neighbourhood plans delay development? Or does it mean an easier ride for developers? Does it matter? Does the government's increasing efforts to stimulate growth bode well for localism? Or what?
And what does all this mean for London offices, particularly in the outlying areas? Well the LOPR is rather a long and wide-ranging report this year. Dr Rob Harris, one of its august authors (and a mate) accedes that they "never expect me to read it thoroughly". Blimey, can hardly read at all these days, and this week I can't speak either! I kid you not. I have totally lost my voice. Thankfully it has an executive summary with gives a good resume of the main themes, and Rob points me to some controversial ideas on Outer London (Chapter 4) and hybrid buildings (Chapter 9).
So.... I said to the Good Doctor Rob there: look I can't read anything dearie, pull me out the nuggets. And he identifies four.
First, it would seem that the London property market must face up to slower structural growth and demand. Long-term economic pressure, together with changing work styles, equates to "spaceless growth" i.e. companies can grow but that might not entail them needing more space. Now we have long held this as an instinct or an intuition, but here you have hard empirical evidence.
Secondly (and again probably not a surprise) London's business geography is changing. As mini CBD (Central Business Districts) form around the central area, in places like Paddington (pause for moment of bosom swelling pride), Outer London offices are in long-term decline; but the good news is the City is diversifying and new centres are emerging.
Thirdly we need to build a much wider range of products in terms of office premises. Those trophy buildings in the core of London are all very well, but we need different products for evolving users (such as the hybrid buildings). Well! This is all grist to the regeneration mill of course.
And fourthly, what of office buildings in London local town centres? Well, sadly, the office-to-resi market will not soak up the glut of obsolete 60s/70s buildings that blight many high streets. This is where Ms Portas's town teams need to exercise some imagination. Local planners cannot knee jerk to filling land and mixed use schemes with Institutional B1 buildings. This response demonstrates no understanding of the grain of demand and folk must start to think about a richer tapestry of work environments. Wrapped in this argument is the need to re-think the Use Classes Order (UCO) on high streets and make it easier for change of use. The London Borough of Richmond is showing the way, looking at creating a template of different use types (NOT the traditional split between office and shed) which will allow them to defend employment buildings in the context of the NPPF based on a clearer understanding of demand. Flexibility is the watchword.
A cry for market realism from planners all over again. Whether they have neighbourhood plans or not. And the lesson for regeneration practitioners? Be creative in what you think of as "office work" and the buildings that it could occupy.