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City of London to turn empty offices into houses

·3-min read
View of the Leadenhall Building and the Gherkin soaring over a new developments on Fenchurch Street in London, United Kingdom. Photo: Barry Lewis/In Pictures via Getty Images
View of the Leadenhall Building and the Gherkin soaring over a new developments on Fenchurch Street in London, United Kingdom. Photo: Barry Lewis/In Pictures via Getty Images

Working from home could be given a new meaning in London's Square Mile, as plans have been unveiled by the City Corporation to convert deserted office space into 1,500 new homes. 

The office exodus sparked by the coronavirus pandemic has left many companies wondering whether it is worth the cost of having a permanent footprint. Many have already reduced floorspace and others have laid out plans to uproot in the new era of flexible working.

The Corporation report laid out a commitment to making the City an "outstanding environment" saying it would "explore new ways to use vacant space and aim for at least 1,500 new residential units by 2030."

It also said it is looking to rapidly roll out 5G networks and slash emissions by improving infrastructure. 

Watch: City of London expects most workers to return

READ MORE: Barclays CEO: Packed Canary Wharf offices 'may be a thing of the past'

Policy chair at the City of London Corporation, Catherine McGuinness, said: “We have been listening to businesses of all sizes in the City to understand how the pandemic has affected their ways of working and their needs going forward. 

"Firms have told us that they remain committed to retaining a central London hub but how they operate will inevitably change to reflect post-pandemic trends, such as hybrid and flexible working."

Many big companies have already pledged to shrink their office footprint amid a prolonged shift to flexible working. 

Indeed, Noel Quinn, the chief executive of HSBC, said on an earnings call on Tuesday morning that the bank plans to axe 3.6 million square foot of office space globally by the end of this year.

READ MORE: HSBC plans to slash office space post-COVID

The bank had already moved to scrap the executive floor at its Canary Wharf headquarters, instead repurposing the private offices for client meeting rooms and collaboration spaces.

Top bosses including chief executive Noel Quinn will now hot desk in an open-plan space two floors below.

HSBC expects to reduce its office footprint by 40% in coming years, and wont renew city-centre leases expiring in the next three to five years.

Quinn has said HSBC is committed to staying at its Canary Wharf headquarters, which houses 10,000 staff. However, smaller offices are likely to be closed.

Other banks and large corporates are reconsidering how and where staff will work post-COVID. Barclays (BARC.L) chief executive Jes Staley last year said packed city centre offices could be a "thing of the past." Twitter (TWTR) has told staff they can work from home indefinitely.

Results of a survey released by Deloitte earlier this month showed a divide in opinion on the future of working from home. Nearly one in four workers said they hope never to set foot in an office again, while a slightly larger proportion (28%) said they are desperate to return. Around four in 10 (42%) said a balance between office and home work would be preferable.

Watch: HSBC quarterly profits surge on improved UK economic outlook

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