U.K.’s City Exodus Continues

In response to the rising demand for flexible work environments, over half of U.K. businesses have established offices or workspaces outside of major city centers, as reported by The Guardian.  

The recent data stems from a study by flexible workspace provider IWG, which manages around 300 offices under brands such as Regus and Spaces. The study reveals that a significant 82% of companies have modified their office requirements to accommodate more flexible work arrangements. The research, which surveyed 500 businesses, revealed that 54% now operate office or co-working spaces outside city hubs — with 38% establishing secondary locations in commuter towns. 

The research indicates that 73% of businesses have reduced their office space expenses by cutting down on central city requirements. For instance, HSBC announced its departure from its Canary Wharf global headquarters, opting for smaller offices in the City of London, aiming to reduce its global office space by 40% — due to hybrid working and cost-saving initiatives. 

Companies are also noting savings in staff travel expenses, with 36% reporting reduced costs due to reconfigured office spaces catering to a flexible workforce. 

“It’s clear that the old ways of working, with a daily unproductive and expensive commute, are long gone,” IWG’s chief executive Mark Dixon said. “Businesses are realizing that not only does hybrid working make sense for their bottom lines, it also benefits their workforces.” 

Dixon’s view on productivity is supported by the fact that productivity levels in U.K. businesses that have adopted flexible work environments show no significant change from pre-pandemic times, according to The Guardian. This notion challenges concerns that remote work might harm the U.K.’s productivity rates. 

The move towards smaller offices outside of major city centers in the U.K. is a clear indication of the changing landscape of commercial real estate. With more businesses evaluating their own work environments and commercial leases, the future of work is moving rapidly towards flexibility — benefiting both companies and their employees.