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The future of central business districts

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In all the far-reaching ways that COVID-19 has altered our daily lives, perhaps one of the most significant is the impact on central business districts (CBDs).

The lockdown caused by the pandemic pushed the purpose-built offices we worked at and the surrounding businesses that fed off them – the places that served our daily coffee, the retailers where we shopped, the places we went to relax after work – to the brink of extinction.

Consequently, working from home (WFH) versus working from the office (WFTO) is now a hot debate and a dilemma facing many employers. Here we look at the options facing CBDs and whether there is a place for them in the future.

Global business districts

At the beginning of 2020, the 21 global business districts (GBDs) in the world’s largest and most powerful business cities (as cited in The Attractiveness of Global Business Districts Report by EY and Urban Land Institute) were the main workplace for nearly 4.5 million people.

In areas such as Canary Wharf and the City in London, Midtown and the Financial District in New York and Marunouchi in Tokyo, these 100 million square metres or so of space were home to the global headquarters of about 20% of the Fortune Global 500 and millions of people who worked, shopped, played and lived there.

However, once coronavirus took hold, 14 of these GBDs were put under full lockdown meaning 3.5 million workers left, while the remaining GBDs also saw some restrictions. And just like that, GBDs went from being economic and social hubs to virtually ghost towns.

The shift to working from home

As employees were pushed out of CBDs into their homes, for the most part they quickly adapted and thrived with this new way of working. Productivity was often boosted by the flexibility and wellbeing benefits that working from home offers.

So much so, it gave many businesses a new mindset on home working. Companies such as Google, REI and Twitter are among those who have now adapted their working from home policies to give employees the option to enjoy a much more flexible approach to when and where they work, or to work from home indefinitely. So even when there is a large-scale return to the office, it won’t be in the same numbers as before.

An end to the office being solely used for working?

In a survey conducted on behalf of Withers Worldwide, experts in the area are suggesting that “there will be a dramatic increase in the demand for flexibility in the workspace” and “the days of whole buildings being occupied by a single tenant for a single purpose… are over.”

According to the EY survey, GBDs must become “inclusive urban destinations”, with 40% of respondents citing a desire for mixed-use spaces; moving from solely places of work to hubs of social life – a ‘work, life and play customer experience’. 28% of respondents wanted more focus on user health and wellbeing.

But the question is can CBDs and GBDs adapt and convince stakeholders – be it companies, employees, shoppers or residents – that they still have a place in our changed world?

How should CBDs be planning for the future?

Even with the advent of a vaccine, there will be changes to the way we work and socialise. Businesses and landlords will need to create innovative and healthy workspaces that enable effective social distancing, as well as create more flexible spaces that can accommodate different businesses.

Attracting and maintaining business talent is key to a GBD’s success, as everything stems from there. Among experts surveyed by EY, 84% considered access to highly skilled professionals essential to the attractiveness of GBDs.

The post-Generation Zers have grown up in a different climate, with environmental and societal responsibilities more likely to be high up on their list of priorities. So, measures like diversified and sustainable transport networks, efficient resource management and adding more greenery will be key in making GBDs an attractive place to work.

The truth is it looks like there is a place for CBDs and GBDs. As long as they can adapt to the changing needs and sensibilities of the post-pandemic world.

Claire James
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