New “flexible” work spaces could be under threat from soaring property prices

People hard at work in TechHub, in London's Shoreditch district. Image: Getty.

The traditional notion of the “office” is changing dramatically. And although there are shifts around their actual design, the most dramatic change is cost.

The cost of renting office space in many central business districts around the world is now so high that it has for a long time been out of reach for many small and medium-sized enterprises (SMEs). Knight Frank’s recently released Global Cities 2016 report shows that rents can range from approximately $33.50 (£22.00) per square foot per year in Seoul, to an eye watering $255 (£165) square foot per year in Hong Kong – by far the most expensive city to rent an office in the world.

These figures have all sorts of negative implications for those early to mid-stage businesses that benefit from being physically located in the centre of cities, resulting in them either moving or starting up elsewhere. This is concerning given how important SMEs are to the overall economic health of contemporary cities. 

The onset of the digital revolution began to disrupt the office market in the early 2000s, encouraging the growth of new types of working patterns, new career trajectories, and practices. A year-on-year increase in the number of freelancers, consultants, or those working from project to project, has amplified the demand for work space that is more flexible than the traditional office environment and infrastructure provides.

This has coincided with the rise of more “creative” career trajectories that also rely on this type of flexibility: artists and designer-makers, but also software developers, graphic designers, and more.


Into the hub

The new type of flexible work spaces they require have been on the rise for some years, and goes by a number of different names: co-working spaces, incubators, flexible work space, open workspace or hubs.

These new work spaces act as hubs for these workers from non-related sectors and firms who come together to share the same environment. To work they must be affordable (especially for early to mid-stage workers, consultants and startups), and close to centres of sector-specific activity (usually city centres or creative quarters). They also need to have flexible rental arrangements, and to provide amenities that keep flexible workers returning: this can be provided through the immediate urban environment (think Shoreditch in London or Wicker Park in Chicago), or through the building itself (as in a café or bar or other type of amenity).

They work by charging a monthly rate for desk rental or for open work space (including the provision of wifi and sometimes a land line). This creates an economies of scale, thereby offsetting the price of the larger space by subletting. They also work on a flexible membership basis, with flexible contracts allowing people to leave with short notice.

Many of these spaces, in cities across the globe, offer a variety of services and features to their members. Some curate their members in order to ensure a working environment where collaboration is central. Others gear their space towards startups and early stage businesses, by holding guest talks, seminars, business surgeries, and the provision of machinery for rent. Others still charge exorbitant rates for desk space to create opulent environments ensuring exclusivity.

Whatever the model, these spaces represent a new working landscape in the contemporary urban environment. Many view them as the new engines of economic growth and innovation.

But they are under threat. London is suffering not only from a well-documented,  but a not so well-documented workspace crisis, too. This is because the buildings used to house these work spaces are usually rented: the leases usually negotiated are short term (2-5 years) and market driven, or in some cases just below the market average.

The rise in property prices means that, once the time comes to renegotiate a new lease, landlords can raise the prices to new market highs and make a killing. This is especially true of the buildings that are close to the city centre (Shoreditch is a prime example here).

The result is that all the old difficulties of unaffordable office rents are returning to stifle emerging economic activity for SMEs once again. In London, this is threatening the growth of these new types of work space, even as they are enabling a growth in the number of SMEs and startups.

Dr. Tarek Virani is a post Doctoral Research Assistant at Queen Mary, University of London & Creativeworks London.

You can join him and guests on Friday 29 April at the Creativeworks London Festival. All sessions are completely free. For more info and to book tickets, click here

 
 
 
 

What would an extended Glasgow Subway look like?

West Street station. Image: Finlay McWalter/Wikimedia Commons.

There are many notable things about Glasgow’s historic Subway.

It is the third oldest in the world. It is the only one in the UK that runs entirely underground. It runs on a rare 4ft gauge. For reasons passing human understanding, it shuts at teatime on a Sunday.

But more significantly, it’s the only metro system never to have been expanded since its original development. A couple of stations have come and gone in the 122 years since the Subway opened (and promptly shut again following a serious accident before the first day was out). But Glasgow’s Subway has remained a frustratingly closed loop. Indeed, while a Scottish newspaper recently estimated there have been more than 50 proposed new stations for Glasgow's iconic Subway since it first opened, all we’ve had are a couple of replacements for closed stops. 

The original route map. Image: SPT.

It’s not for a lack of trying, or at the least discussion. Glasgow’s SNP-led council pledged a major expansion of the Subway as part of their election pledge last year, for example, vowing to find the funding to take the network beyond the existing route.

All this sounds very familiar, of course. A decade ago, with the 2014 Commonwealth Games in mind, operators SPT began looking into a near-£3bn expansion of the Subway into the East End of the city, primarily to serve the new Velodrome complex and Celtic Park.

In the end, the plans — like so many discussed for expanding the Subway – failed to materialised, despite then SPT chairman Alistair Watson claiming at the time: “We will deliver the East End extension for 2014. I am being unequivocal about that.”

As detailed previously on CityMetric, that extension would have seen seven new stations being opened along a second, eastern-centric loop, crossing over with the original Subway at two city centre sites. Had that gone ahead, we would by now have had a new route looking something like this:

The 2007 proposals for an eastern circle. Image: Iain Hepburn.

St Mungo’s would have been close to Glasgow Cathedral. Onslow, presumably located on or near Onslow Drive, would have principally served Dennistoun, as would have a link-up with the existing Duke St overground station.

Gorbals, benefiting from the ongoing redevelopment and residential expansion that’s all but erased it’s No Mean City reputation, would have gained a station, while Newhall would have been next to Glasgow Green. Dalmarnock station would, like Duke Street, become an interchange with Scotrail’s services, while crucially Celtic Park would have gained the final stop, serving both the football stadium, the nearby Emirates Arena and velodrome, and the Forge shopping centre.


Those plans, though, were drawn up more than a decade ago. And if the SNP administration is serious about looking again at the expansion of the Subway, then there’s more than a few changes needing made to those plans.

For starters, one stop at the far end of the loop serving Celtic, the new sports arenas and the Forge feels a bit like underselling the area, particularly with so much new residential development nearby.

Two feels more realistic: one serving the Forge and the rest of Dennistoun, and the other sited on London Road to serve the mass volumes of football and sports traffic. And if Ibrox can have a stop, then it seems churlish not to give the other of the Old Firm clubs their own named halt.

That’s another thing. The naming of the proposed stations is… arbitrary, to say the least. You’d struggle to find many Glaswegians who’d immediately identify where Newhall or Onslow were, off the top of their head. 

The former, especially, seems like there’s a more natural alternative name, Glasgow Green; while the latter, with a second Forge stop also serving Dennistoun, would perhaps benefit from named for the nearby Alexandra Place and park.

(Actually, if we’re renaming stations from their unlikely original choices, let’s say goodbye Hillhead and a big hiya to Byres Road on the original Subway while we’re at it…)

So, what would a realistic, 2017-developed version of that original 2007 proposal give us? Probably something like this:

Better. Image: Iain Hepburn.

One glaring issue with the original 2007 study was the crossover with the… let’s call it the Western Subway. The original proposal had St Enoch and Buchanan St as the crossover points, meaning that, if you wanted to go out east from, say, the Shields Road park and ride, you had to go into town and double back. 

Using Bridge Street as a third interchange feels a more realistic, and sensible, approach to alleviating city centre crowding and making the journey convenient for folk travelling directly from west to east.

There’s a good case to be made for another south east of the river station, depending on where the Gorbals stop is sited. But these are austere times and with the cost of the expansion now likely more than £5bn at current rates, an expanded Bridge Street would do much of that legwork.

Putting all that together, you’d end up with something looking like this:

 

Ooooh. Image: Iain Hepburn.

Ahead of last year’s election, SNP councillor Kenny McLean vowed the party “[would] look at possible extension of the Subway and consider innovative funding methods, such as City Bonds, to fund this work. The subway is over 120 years old. It is high time that we look to connect communities in the north and east of Glasgow.”

Whether Glasgow could raise the £5bn it would probably need to make the 2007 proposal, or an updated variation of it remains, to be seen. And this still doesn’t solve how many places are left off the system. While a line all the way out to Glasgow Airport is unrealistic – after all, an overground rail service to the airport from Paisley has failed to materialise after 30 years of discussion and planning – there’s plenty of places in the city not well served by the Subway, from Maryhill in the north to Hampden in the south, or the riverside developments that have seen flats replace factories and new media hubs, museums and hotels line the Clyde.


Image: Iain Hepburn.

Key city landmarks like the Barrowlands, the Riverside Museum – with its own, fake, vintage subway stop, or the Merchant City are woefully underserved by the subway. But their incorporation – or connection with a Glasgow Crossrail – seems a very expensive pipe dream.

Instead, two adjoining loops, one to Ibrox and one to Celtic Park, seems the most plausible future for an extended Subway. At least colour coding the lines would be easy…

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