New models for workspace and mixed use development at abrdn PLC
Above: CGI of DUO 280 Bishopsgate and Bishops Square, Spitalfields, London (from Arax Properties / CBRE Global Investors)
Future Cities Forum is holding its June forum at the new offices of abrdn PLC in the City of London at DUO 280 Bishopsgate, to look at developments in office and mixed-use districts.
Chief Operating Officer for the real estate division at abrdn, Simon Moscow, will be speaking about the firm's move to recently remodelled offices in Spitalfields as well as its investments across mixed-use developments.
The firm's new offices are in the refurbished former City of London office of the Royal Bank of Scotland at 280 Bishopsgate. The move will allow for 'blended working' with staff working at home as well as in London. The new building has a rooftop terrace and balconies. Coming to the office for employees will allow for collaboration, networking and coaching.
Simon commented at our forum in January 2022 (opened by Matthew Vickerstaff, Head of Project Finance at the Infrastructure & Projects Authority), on the challenges of keeping city centres vibrant with a balance of workplace, retail and leisure assets , post-Covid 19:
'There has been the structural shift in retail with the rise of internet retailing and general shopping patterns over the last decade. In addition there are issues as a result of the oversupply of shopping centres and town centre retail in the UK. There has been an over development and under demolition issue where retailer owners and investors just kept on building shopping centres with little thought given to the impact that has on the second or third scheme in a town. Then the pandemic came which has escalated all the known problems and shifts in the changing patterns of retail and shopping. There are similarities to the changes currently seen in the office sector today.
'The problem for retail asset owners is around re-adjustment and re-basing of rents and capital values given the over supply issues. There is also a shift in the way occupiers use and lease space with the increase in turnover rents and shorter more flexible leases. We are now moving towards partnerships and collaborations between landlord and tenant, or customers and partners as we now refer to our occupiers. The prime and dominant end of the market will be fine as we are witnessing a resurgent investment market which was dormant last year. In the mid-market territory it is essential that schemes stay relevant for consumers to mix shopping with leisure activities and an experience that you can't get online.
'The concern should be around the stranded centres that have been left behind - what do you do with all these shopping centres? The simple answer is you need to re-purpose them. However, it's complex, time consuming, expensive and requires co-operation from all stakeholders including the local planning authority. You can't just remove a shopping centre from the middle of a town or city district and replace it with an alternative use such as residential. To keep a city centre vibrant, owners must consider how to introduce other uses to complement the retail. For short term gains you can replace a department store with a trampoline park, for instance, but while this may increase footfall, it's a not a long-term solution.'
Knight Frank's Partner and Head of Research and Development Research, Oliver Knight, has also been writing about the future for mixed use districts saying:
'...the city centre has long been dominated by office and retail sectors. While this will remain the case, changing working and shopping habits point to the need for more balanced mix in the future. Part of the solution lies in making better use of the buildings we have. Repositioning or repurposing existing assets for alternative use. Logistics, residentials and life science are obvious beneficiaries....Looking forward, major new mixed-use hubs targeting a full breadth of occupiers, workers, and visitors are planned in other parts of the capital including in Euston, the Southbank and Canada Water. Yet the question remains - if the data is telling us that we have a consistent issue with undersupply across London (within both the residential and commercial sectors), will building mixed-use help or hinder the drive for more space?...What has become increasingly obvious is that building mixed-use is about so much more than simply meeting demand. It is vital to create a modern city fit for post pandemic life. As well as making better use of limited land availability, there is evidence that connecting people with amenity and infrastructure can have a positive impact on capital values and rents and, longer-term, supports the creation of communities.'
Oxford with a tradition of central city science districts (in Parks Road) - as well as science and healthcare campuses outside at Begbroke, Headington and Cowley - is developing lab space in Cornmarket, a busy shopping area. The former Clarendon covered retail space has emptied of retail in favour of shopping outlets and stores in the re-modelled 1960's Westgate nearby.
At our forum in Oxford last October Peter Canavan, Partner at Carter Jonas, explained how this has enabled new science lab space to be planned and designed:
'The re-use of The Clarendon Centre - by Lothbury - is in some ways the story of our UK high streets and their future. Science lab space is going into that space to re-develop the centre, but the number of units are not sufficient in themselves, so student accommodation will also be built there. It is very much the north American model. It creates and maintains an active space through the whole day and therefore does not become deserted. Often experiments in labs go through the night, and this is what will be the case here. It is complemented by the activities of Cornmarket and a public square too and in turn the development adds to this public realm.'
Below: Queen Street entrance to the Clarendon Centre, Oxford