Negotiations With Unions
Estimates of how much space the UK government occupies in London vary, but CoStar/EG data shows that the Department of Defence, the Home Office and Ministry of Justice alone lease close to 2.5M SF. When it looked like offices would be able to open at the end of summer 2020, government ministers were pushing for a full-scale return to the office. But there has recently been an acceptance that staff will be allowed to work from home some of the time. No official policy has yet been unveiled by the government and negotiations continue between Civil Service unions and individual government departments.
Tech giant Google is London’s largest private sector occupier outside of flex office firms, with 2M SF of space in the capital. Before the coronavirus pandemic, the company was renowned in the tech world for being highly pro-office. But it has embraced the hybrid work world and laid out some fairly clear guidelines. Although policies differ according to role, most Google staff will be in the office three days a week and working remotely the other two days. Individual teams will work out when they are in and out. Staff will be able to apply to move offices or to work fully remotely. “Taken together, these changes will result in a workforce where around 60% of Googlers are coming together in the office a few days a week, another 20% are working in new office locations and 20% are working from home,” Chief Executive Sundar Pichai said in May.
Clarity: Three Days A Week
"Working From Home Is Not Sustainable"
Barclays is one of London’s largest occupiers, with an office footprint of 1.4M SF in the capital. CEO Jes Staley has been sceptical about working from home, saying it is “not sustainable” in the long run for financial services firms. But the bank has not made explicit a defined policy around how often it expects staff to come back to the office.
Public Scepticism vs Hybrid Reality
JPMorgan CEO Jamie Dimon is one of those bank executives who has been scathing about working from home, saying it doesn’t work for those who “want to hustle”. But the company he leads has been much more conciliatory in the practices it is adopting and has wholeheartedly embraced the hybrid working model. About 30% of its London staff in the 1.4M SF it occupies have been coming to the office over the summer, a figure it expects to increase. In its investment bank and much of its UK operations, it will adopt what it calls a "hybrid rotational" model, with staff either working from home for one or two weeks per month, or two days per week, depending on which team they are in. As is the case across all investment banks, some divisions, like trading, will be in five days a week, with regulatory codes meaning they can’t work from home.
The immediate casualty in real estate terms is likely to be regional offices. The company said the ability to work from home meant it no longer needed disaster recovery centres. In the UK it has such a centre in Basingstoke.
The Man At The Top Likes Remote Work, So ...
Facebook occupies about 1.2M SF of office space in London, and among the big tech firms, it has been the most willing to embrace remote work. The company has not outlined a prescriptive policy for employees. Instead, it is allowing them to apply to work remotely some or all of the time, and said in June that about 90% of the requests it had received from staff had been approved. Outlining how company policies are often shaped by the experience of those at the top, Facebook CEO Mark Zuckerberg has talked about how positive he has found working from home, and that he plans to spend at least half of his time working remotely by 2022.
The End Of The Executive Floor
HSBC, which occupies about 1.2M SF in London, is another bank that has fully embraced the hybrid work model. CEO Noel Quinn said last week that the company would not be overly prescriptive, but expected staff to be in the office about three days a week. And it is planning to alter its real estate footprint to match. Quinn said the company expected to cut its global real estate footprint by about 40%, with a ratio of one desk for every two staff becoming the norm and many city-centre leases not renewed as they fall due over the next few years. At its London HQ in Canary Wharf, it has done away with a dedicated floor for senior executives.
What The Spies Are Up To
The UK’s secret service occupies about 1M SF in London, a figure that seems surprisingly high, although that might be the point. The Foreign Office did not reply to a request for info about MI6’s future office occupancy plans, but it is safe to say staff will continue to work from home, whether that is their own home or those of the people they are spying on.
Back To The Office
Goldman Sachs is the big outlier when it comes to London’s office occupiers. It wants staff back in the office, pronto. CEO David Solomon has called working from home “an aberration that we are going to correct as soon as possible”. About 40% to 50% of London staff have been back in the office since lockdown regulations were eased in July. That number is expected to increase. The company has no set policy on the return to work, but senior execs have consistently stated they expect to see staff back in the office, with the implication that means every day. The company occupies 827K SF in London.
The Antithesis Of Goldman
Credit Suisse is the antithesis of Goldman Sachs, offering the most flexible working practices of any major London investment bank. Its 799K SF of offices in London will be part of its Way We Work initiative, which will allow individual staff and teams to negotiate with managers over how often they come in to the office and when, with no set mandate about the amount of time that will be spent in the office.
Start When You Like
Advisory firm PwC employs 22,000 people in the UK, and occupies 729K SF of office space in London. It is embracing the world of hybrid work. The company said in March that it expected staff to spend about 40% to 60% of their time working with colleagues — which could mean either in PwC offices or out seeing clients — with the rest of the time spent working remotely. Chairman Kevin Ellis also said staff could "start when you like" in terms of setting parameters for their own working day.
Swiss Solidarity On Hybrid Work
Like fellow Swiss investment bank Credit Suisse, UBS is embracing the hybrid work model, albeit with a little less flexibility. It said that it expected around two-thirds of its staff to mix working in the office and from home in future, with hybrid work policies to be rolled out on a country-by-country basis. It occupies 700K SF in London.
Hybrid Without Prescription
Like fellow advisory firm PwC, Deloitte has embraced hybrid work, but with a more flexible outlook. The company’s offices, including the 634K SF it occupies in London, have been operating at a maximum of 50% capacity until this month, when they will be able to operate at 100% capacity — except in Northern Ireland, where government guidance is to continue to work from home. The company is instituting a hybrid work policy without mandating how many days staff need to come into the office.
Tech giant Apple has embraced hybrid working, but in a way that has not been without its controversies. Earlier this year, the company told staff it expected them to come into the office for three days a week — and that those days would be Monday, Tuesday and Thursday, with Wednesday and Friday working from home. That level of prescriptiveness has annoyed some staff, who wrote to the company to express their displeasure. A counterargument would be that telling staff when to come in to the office avoids the creation of a two-tier system where some staff come in and are promoted ahead of those that prefer to work from home. Apple occupies 571K SF in London.
Hybrid Policy Reviewed Next Year
Lloyds, which occupies 564K SF in London, said it expects the majority of its staff to adopt a hybrid work model, with some able to work fully remote and some in the office full time. Of those that are hybrid, there will be no set number of days in the office. Schedules will be agreed with managers in individual locations. The policy will begin in October and be reviewed next year.