News releases, blogs and provocation papers which set out some of the issues and thinking behind the research and our response to emerging themes.
Hannes Read, City REDI, reflects on the emerging research.
Since the Covid-19 pandemic, many people and businesses have been required to work from home rather than the office. The sudden shift away from working in the office has significantly impacted the Business, Professional & Financial Services (BPFS) sector.
As the UK looks to emerge out the other side of the pandemic, City-REDI at the University of Birmingham have been working alongside Colmore Business Improvement District (BID) in Birmingham city centre in a unique study on The Future Business District. The aims of the project are to inform the response to long term recovery from the Covid-19 pandemic and to offer policy directions on best practice for BIDs to adapt to the changes in future.
The director of policy and research at the Centre for Cities, Paul Swinney, has recently appeared on the Wake up to Money programme on BBC Radio 5 Live claiming that, in the long term, we will see a return to the office five days a week. Yet, even prior to the pandemic, many people in the BPFS sector were not working full time in the office. The ‘flexible’ or ‘hybrid’ working that many people have become accustomed to recently was already underway; what the Covid-19 pandemic has done is accelerate those existing trends. So, the wheels were already in motion to move away from a five-day office week. A move back to pre-pandemic trends would still include a growing portion of remote working.
This is not to say that the office will become redundant, however. As identified by Paul Swinney, there are many benefits to being in the office, which are likely to persist and remain important. The networking, collaborations and ideas sparked by face-to-face interactions cannot be easily replicated virtually. Younger people, in particular, can have plenty to gain from meeting in person in the office.
“[Learning is] human nature, the end of the day. How the how the heck can the young people learn, you know. We’re learning, I’m always learning. You can’t learn by despite using these zoom screens, you know, it’s those interactions are conversations that actually are the most productive learning process within office space.”
Interview participant, 2021
There are opportunities for younger people to learn good practice and building connections from meeting face-to-face. Exactly how the office space is used is more open for discussion. Yet our research has found it is likely to evolve to better capture the benefits of office-working, with more break-out rooms, areas for collaboration spaces and a greater emphasis on leisure.
Almost all the businesses, developers, and organisations we spoke to as part of the Future Business District study considered hybrid working to be here to stay, in some form. Whilst exactly how to coordinate and manage some people working part from home and part from the office is less clear in practice, the intention is certainly there. Still, teething problems may need to be worked out. For example, if the decision was left to employees to choose when they may come into the office, there could be a larger number of younger people going in the office on a Friday in anticipation of post-work drinks at the end of the week. And by the same token, there may be few people coming in on a Monday to ease themselves into the week. The uneven demand for office working can be at odds with some businesses acting to reduce the supply of office space.
Still there is evidence from the Future Business District study that, in Birmingham, there is demand from both businesses and employers for a high-quality office space.
“[The future office is] much more about shared knowledge, inspiration, and breakout spaces and also quiet areas as well …
They created a quality environment … The big point is the flight to quality.”
Interview participant, 2021
The demand for good quality meeting rooms, collaboration spaces and breakout rooms is likely to increase. The considerations for energy efficiency, carbon zero building materials, sustainable transport infrastructure and parking, are also on the increase. Developers and businesses have planned for these trends already and the demand for high quality office facilities is likely to continue to increase in the aftermath of the pandemic. Likening the office to a ‘destination’ is one way to encourage people to come into the office space and facilitate collaborations between people.
There are implications facing the wider business district as a result of the shift to hybrid working and increase in demand for high quality office space. The findings from the Future Business District study shows that the way in which businesses and people will work and interact in the office are likely to change. Yet office working is unlikely to return quickly to something more akin to 2019. Hybrid working, where people work from home part of the week and from the office the rest of the time, is likely to continue to be the norm. The shifting office use towards a high-quality destination with greater collaboration and networking space is an opportunity to adapt to the changes. BIDs and other place-focused organisations have a significant role to play in facilitating a smooth and practical transition in the way hybrid working and new office uses. It cannot be ignored that many lower grade offices may become less attractive too in future. But plans for how they can be used in future, such as public indoor spaces, or education spaces could help bring an attraction to those areas. Encouraging the office and the wider city centre to become a destination where people can come in has wider benefits for the broader city centre ecosystem.
The changing business district can be seen as a journey. It is unlikely there will be a point where we ‘arrive’ at the trends facing the future city centre. But there can be a series of iterations and learning about what works well for businesses and the work-life balance of employees. Leadership organisations such as BIDs and local authorities from across the city centre are vital in working with businesses and organisations to adapt to the changes for the future business district.
Mike Best and Kevin Johnson set out to explain the background to the Study
The ‘business district’ is facing an existential crisis because of the Covid-19 pandemic. It is evident globally and in the UK. Birmingham is no different.
Lockdown in March 2020 resulted in a sudden switch to remote working and online shopping as our city centres emptied overnight.
With the easing of restrictions from June, limited re-opening of the retail and hospitality sectors saw drastically lower footfall as most offices remained closed as ‘work from home if you can’ and ‘avoid public transport’ continued to be Government advice.
By August, there was encouragement of a return to the office to coincide with schools re-opening. Many businesses and office buildings are now geared up for Covid-secure operation; however the spike in cases in early Autumn, local restrictions in major cities like Manchester and Birmingham and fears of a second wave continued to defer a significant move back to central business districts.
Government then switched advice to work from home where possible. The evidence appears to suggest that smaller towns and suburban centres have benefitted, whilst city centres and specifically business districts have suffered the most.
Where to work has now become a matter of choice, for businesses and individuals, who have become used to and proven that remote working can be productive and suit both lifestyles and family circumstances.
There are downsides of course, but the future of work and the role of CBD offices are now in the news and front-and-centre of many business continuity strategies – why go back to the office, rather than when?
Less well debated is the future of business districts themselves – the places where offices locate together with the supporting infrastructure of business networking, conferencing, hotels, retail, hospitality and cultural attractions and in close proximity to town halls and the corridors of power.
These areas of our major city centres should be considered as having a value beyond supporting six Pret-a-mangers. They are an ecosystem of large corporates, SMEs and small independent businesses that have historically thrived by each other.
The questions now are why do we need business districts and how can we ensure they remain successful as places to attract businesses and people post-pandemic?
Over the past twenty years, most UK city centres have gradually recovered from the era of business parks and out-of-town retail and leisure which had hollowed out many.
The story of Birmingham’s city centre remains a living case study.
In recent decades, the story begins at the Highbury Summit of 1988 through the development of the ICC and Brindleyplace;
retail revolutions of the Bullring, Mailbox and Grand Central; the Big City Plan giving rise to Eastside, Paradise and Smithfield and the transport investments of New Street Station, HS2 and the Metro which will link Snow Hill and Westside.
Birmingham’s three flagships of the Bullring, Brindleyplace and New Street Station/Grand Central, all built since the millennium, demonstrate the importance of a strong retail offer, high quality office environment and excellent public transport hubs.
Colmore Business District, the historic heart of our business professional and financial services sector (BPFS) for over a hundred years, has also revived with new Grade-A office developments, the refurbishment of many older buildings and an explosion of food and drink, from fine dining to craft beer and cocktail bars.
The growth of Birmingham’s BPFS sector has not simply been due to smarter offices and sandwich shops. A successful city centre is one which harnesses ideas and collaboration; innovation and enterprise with a clustering of professionals and firms which fuel an economic engine. It is an environment which is liveable and attractive, highly productive and vibrant.
Eleven years ago, Colmore Business District became the UK’s first predominantly office-led BID, encompassing over 700 businesses and 35,000 employees. Today, it forms part of a mosaic of five city centre BIDs including Westside, Retail, Jewellery Quarter and Southside working closely with the City Council and other agencies to manage the city centre environment and foster its continued success, raising in excess of £4m each year through levies for business-led initiatives.
Colmore BID has helped foster a sense of community; Birmingham’s heritage has inspired a new generation of ideas and innovation and the district’s firms have benefitted from a young and diverse population, attracting talent from all over as well as increasing numbers who have been educated at leading institutions on our doorstep.
The promise of Paradise to the west and the Curzon HS2 station area to the east, connected by an extended Metro network and high quality public realm, will create an arc of business activity across the city centre, alongside build-to-rent residential which is emerging as a key driver of the next wave of development. Much of this emerged from the Big City Plan a decade ago, which is about to be reviewed in the context of the Council’s Route to Zero (R20) strategy.
There is a spectrum of data, trends, analysis, commentary and ideas to call upon. National and global perspectives will be useful, but Colmore Business District has a unique positioning and will need to assess issues and opportunities which are specific to the nature of our levy-paying community and the economic and social functions that may be required of Birmingham’s commercial centre in the years to come.
Mike Best, Chair of The Future Business District Steering Group for Colmore BID, reflects on the reasons for this unique
Back then, the city centre was bleak, through a combination of the demise of West Midlands industry that left a population suffering high levels of unemployment, and two decades of a misguided ‘rebalancing’ policy which had limited office development in the city centre, slowing the growth of business and professional services. Add to that the hollowing out of city centre retail that then happened as the ‘out-of-town’ boom took off, the early 1990s was ground-zero.
The City Council, however, had begun the fightback with the Highbury Initiative of 1988, an international symposium of experts held at the home of Joseph Chamberlain that led to the City Centre Design Strategy of 1990, strongly influenced by the late Francis Tibbalds. This sought to dismantle the ‘concrete collar’ of the Inner Ring Road and expand into a series of ‘quarters’ in an enlarged Central Area, starting with Broad Street where the Council had begun the construction of Centenary Square, the International Convention Centre and Symphony Hall, the new performance home to the CBSO, which opened in 1991. Birmingham’s cultural revolution had begun.
Three big regeneration projects also took centre stage in the 1990s:
These three took almost a decade to come to fruition but became the hallmarks and landmarks of Birmingham City Centre’s urban renaissance. With new offices, apartments, retail offer and cultural attractions, the city centre was drawing in young professionals not just to work but to live and socialise. This was also the start of the burgeoning food and drink scene, which for the property world at least had started with the Metro Bar & Grill in Cornwall Street and Bank at Brindleyplace, and who could forget Bill Clinton having a pint at the Malthouse during the G8 Summit in 1998.
The next task was to transform public transport, as the city was being let down by the universally despised New Street Station. It’s worth remembering too that Snow Hill station had been closed from 1972 to 1987, with the later addition of the Midland Metro tram terminus from Wolverhampton in 1999.
The revival of New Street between 2010 and 2015 at a cost of £750m, with the extension of the Metro in 2015, meant a radically improved journey to work for tens of thousands of city workers and the 46.5m users annually (making it the fifth busiest station in the UK and the only non-London station in the top 10).
New Street Station was just one of five Areas of Transformation identified in the Big City Plan of 2011, along with the Snow Hill District, Westside, Eastside and the Southern Gateway. Over the past decade, much progress has been made on all although with much still to be delivered:
I may have missed a few things out on my whistle-stop tour of the past 25 years, but most would agree Birmingham city centre was in a much better place before the pandemic hit.
One of the other features, certainly of the last decade or more, has been the emergence of city centre BIDs (Business Improvement Districts) of which we have five in Birmingham, including Retail, Westside, Southside, Jewellery Quarter and Colmore Business District, on which I’ve served as a board director for 11 years.
Colmore Row has been the historic heart of our business, professional and financial services sector (BPFS) for over a hundred years, and the past decade has seen the revival of the central business district (partly in response to the expansion of the central area prompted by Highbury) with new office developments and refurbishments contributing to what is now home to over 500 businesses and in excess of 35,000 workers.
A significant part of that revival has been the growing hospitality industry, from fine dining (with two Michelin star restaurants) to craft beer and cocktail bars, from sandwich shops to coffee houses, with a high degree of independents. We’ve celebrated this each summer at our Colmore Food Festival, which regularly attracts over 30,000 visitors and has made international news.
In addition, the BID has championed public realm improvements at Church Street Square and Colmore Square, and through the Snow Hill Interchange Plan which has secured almost £10m funding. It has curated photographic exhibitions (most notably with the late Pete James) showcasing local photographers (the award-winning Brian Griffin) and local history (from Nicklin Unseen to Thresholds, both award-winners in their own right), and usually held outdoors where they can be experienced by the widest possible audience.
And we’ve held Community Games and Craft Markets, and multiple events which supplement the buoyant networking scene in the city centre.
All of this has been to create a sense of community that city workers and visitors can enjoy, so that their time in the CBD is not just about a single purpose but gives them lots of reasons to come to and stay in the city centre.
Our Ambassadors and Security team are there to make people feel safe, direct them to where they want to go and, on occasion,
help those in need on our streets to find support and accommodation.
‘Colmore Life’ has become the sum of the parts, making the business district an attractive, vibrant and highly productive place to be.
And through collaboration with our other city centre BIDs, making the connections that ensure workers and visitors take advantage of the retail offer, the culture and hospitality across the city centre from Broad Street to Digbeth High Street, and from Hockley to Hurst Street, with easier walking and cycling routes and better wayfinding.
In these ways, successful city centres harness ideas and collaboration, innovation and enterprise, with a clustering of businesses and interaction between business people that fuels the economic engine.
On almost every metric, Birmingham has been improving its performance in inward investment, business start-ups, job creation, entrepreneurship and graduate retention. The city centre and the business district in particular has played a big part in that.
The Council should take credit, and so should the business community and its representatives like the Chamber of Commerce.
The first lockdown from March-to-May resulted in a sudden switch to remote working and online shopping as our city centres emptied overnight. With the easing of restrictions from June, limited re-opening of retail and hospitality still saw drastically lower footfall as most offices remained closed as ‘work from home if you can’ and ‘avoid public transport’ continued to be Government advice. Our cultural venues have largely remained closed particularly in higher tier areas.
By August, we had Eat Out to Help Out and there was short-lived encouragement of a return to the office, coinciding with the new academic year at schools and universities. Even theatres began thinking of the return of audiences, with the Hippodrome organising its Van Gogh immersive exhibition.
Many businesses and office buildings geared up for Covid-Secure operation; however, the second wave which arrived in October saw local restrictions imposed in most major cities which continued to defer a significant move back to central business districts. Government advice then switched back to work from home where possible and we went into second lockdown in November.
Figures from Centre for Cities’ High Street Recovery Tracker show that footfall in Birmingham city centre had only recovered to 31% of its pre-pandemic levels by early December with expenditure at 17% (the lowest of any city in the UK).
The Worker Index (a more accurate reflection of what’s happening in the business district) was as low as 7% at the start of December from a ‘high’ of around 15% during the summer. Either way, these are figures that cannot sustain any of the supporting businesses which make up the ecosystem of a business district.
This picture is similar in all English core cities, along with Glasgow, Belfast and Edinburgh, whilst for some reason Cardiff and other Welsh cities are faring better.
The longer the pandemic goes on – and even with a vaccine rollout in 2021 most people of average working age are looking at the second half of the year before they can get back to anything like ‘normal’ – our current working arrangements start to feel like the new normal. Combine that with a host of paradigm shifts that are going on in the background like climate change and Brexit, it’s less and less likely that the new will feel like the old.
Of course, once this is ‘over’ there will be a bout of what analysts have called ‘revenge’ spending, or just a good old-fashioned ‘spree’. But how long will it last when we’ve got so used to online. And we will react to remote working by coming together in offices, networking like mad, going to award dinners we had tired of, do working lunches, and any excuse to meet up socially to support our favourite bars and restaurants, maybe to visit BMAG or the Rep, and yes, even to “Save Pret” if that was your sandwich of choice before you succumbed like I’ve done to artisan bread from the local bakery and homemade tuna mayonnaise.
However, where and how we work has become a matter of choice, for businesses and individuals, who have proven that remote working can be productive and suit both lifestyles and family circumstances.
There are downsides, inevitably as we’ve all found, but the future of work and the role of offices are now front-and-centre of many business continuity strategies – why go back, rather than when and how will we use them?
This has huge potential consequences for business districts. Blended working is likely to mean we only need to attend offices for some of the time, when it is most effective, particularly for collaboration, but even that can be replicated online more efficiently when people from multiple locations are involved.
Conferences will almost certainly have ‘livestream’ options to attract more people and ‘onboarding’ of new staff is often cited as an example of where you ‘can’t-substitute-the-office’, but plenty of global businesses do that successfully across continents and across
For everyone who says you can’t survive without an office, you will find someone who shows that you can. It isn’t and shouldn’t be a test of loyalty. But we need to understand how offices will be used, who is most likely to need them, and how they will interact with that ecosystem of other businesses and service providers that surround them – the conference venues, networking clubs, office suppliers, couriers, caterers, recruiters, trainers, hoteliers, retailers, bar and restaurant owners. Will those who attend offices disproportionately generate more business in the area than those who can more easily work from home?
We have to reinvent city centres and business districts as we did thirty years ago, to confront the challenges we face now. The future business district has to make good business sense for companies as a place to co-locate, whether they are a large corporate, an SME or a small independent, and for individuals as a place to work at least part of the time.
And that future has to embrace climate change and all it brings in terms of how we choose to travel, the need for clean air in our city centres, and our long term commitment to zero carbon.
For me, I started my working life driving to work every day, then had the luxury of a company car, fuel card and parking space – so why wouldn’t you? Nearly twenty years ago, at the time Masshouse Circus was being demolished and my journey was made less convenient, I switched to a season ticket for my commute and have used the train ever since.
Eight years ago, I gave up my own car and relied instead on car clubs, occasional car hire and just borrowing my wife’s. I have cycled to work, but it’s not a great experience and I don’t mind using the bus. We can change our ways, and learn to live and work differently.
The Future Business District is a research-driven study commissioned by the BID with support from partners including the City Council, WMCA, GBSLEP and the other city centre BIDs. It will draw on support from the Greater Birmingham Chamber of Commerce and Centre for Cities, working with our research partners City-REDI from the University of Birmingham which is backed by UK Research and Innovation, and seeking input from a wide range of stakeholders representing our diverse city and its business community.
My hope is that it will draw together many strands to plot a course for us to follow as we reinvent the business district.
Mike Best is a Senior Director at national planning consultancy Turley and a board director of Colmore BID.