London sees ‘biggest change in living memory’ in 12 months

LONDON: Business owners and industry experts have said London has witnessed its “biggest change in living memory” after the coronavirus pandemic emptied the streets of the Capital.

Bustling tourist hotspots and busy City office blocks went silent in March as the government lockdown forced the vast majority of people to work from home and visitor numbers dried up.

A year later, just over half of UK workers have returned to their workplaces but the impact on the City of London is still particularly stark.

Mark Dixon, chief executive of office giant IWG, told the PA news agency demand for central London office space has shrunk over the past 12 months, with more firms eying up opportunities outside the M25.

He said the company has seen demand in the City fall by 26 per cent, with a 175 per cent increase in Uxbridge and 52 per cent rise in High Wycombe. He added that the high cost of living in London has particularly weighed on its recovery in demand.

However, commercial property experts have said there have been green shoots of recovery in recent months with an improvement in investment in the City.

Andrew Thomas, head of international capital markets at Colliers, said: “The last 12 months have created the biggest change in living memory for London and we are only at the beginning of the journey.

“The panic that pervaded this time last year on the failure of urbanisation and the death of the office has disappeared with more voices now coming out in support of living and working in our city centres.”

He added that property portfolios have shifted over period with investors and developers looking increasingly at smaller projects in the capital.

Colliers said that demand for the largest developments has dropped 64 per cent year-on-year, although total activity it only down by 20 per cent.

Property giant Savills also reported another rebound last month, with it reporting £346.5 million in sales in February after a quiet January.

However, it said this was still 30 per cent down on February 2020 despite hopes regarding the impact of the UK’s positive vaccination roll-out.

International investment has improved in recent months, but international travel into City has remained thwarted by international travel curbs.

Robert Franks, co-founder of luxury trainer retailer Kick Game, said trade has been hit hard by closures but that store sales have seen their recovery held back by low numbers of tourists in the capital.

The retailer, which specialises in limited addition items, warned that there is still a shadow of uncertainty as to how the tourist market will recover in 2021 despite the Prime Minister’s road map.

London’s hospitality sector has also seen a major shift in the property market, with many closing sites for good and competitors such as Wetherspoons revealing plans to target more central London sites.

Greg Sage, corporate affairs director at pub giant Greene King, said he hopes the government will encourage more people back into city centres to aid the recovery of its hospitality venues.