London’s city centre is changing, with working from home and online shopping leading to less demand for office and shop space than previously expected. Our Research Manager Josh Cottell explains how adding more homes to the mixture of property types could support London’s post-pandemic recovery.
Modern city centres are packed full of different ways of using space. Around the corner from an office block might be a row of houses, and within a short walking distance a supermarket, a library, a coffee shop or two, a museum or gallery, and much more. London is no exception. Walking past one another in the street are a mix of commuters, residents, tourists, shoppers, and other visitors. Central London thrives as an economic and cultural hub due to its rich mix of businesses in different sectors, existing alongside a variety of institutions, residents, commuters, and visitors.
Fewer people have travelled into the city centre in the last two years. The pandemic accelerated the existing trend toward shopping online rather than in person, as well as increasing the number of people who work from home a significant proportion of the time.
The future of central London
Before the pandemic, the city centre’s population would increase by 80 per cent during the daytime as people travelled in to work, shop, and explore. Here we define the city centre as the Central Activity Zone or CAZ, an area stretching across parts of 10 boroughs in inner London. If fewer people travel into the city centre, its economy – which accounts for nearly half of London’s economy and over a tenth of the UK’s – could suffer. The future of central London is still very uncertain, so in our report Remixing Central London, we explored how policy could support central London’s recovery from the pandemic by supporting a successful and harmonious mix of housing and economic activity in the area.
We found that adding more of certain types of housing to central London could benefit current residents, potential residents, and businesses. To achieve this, we propose that planning authorities seek to support a carefully managed process of converting some empty offices, shops, and car parks in the city centre into homes.
Currently, London’s city centre is less densely populated than Paris, Barcelona, or Toyko. This means that London has a smaller proportion of residents living in the city centre than most other UK cities and many major international cities. While the most densely populated area of many city centres such as Birmingham, Newcastle and Southampton is the area within a mile radius from the city centre, in London it’s the area 2-4 miles out from the city centre that’s most densely populated.
Having more residents in the city centre can be a positive for a city, since residents who spend time in their local area not only spend money in the local economy but also play a “stewardship” role in their neighbourhood and add vibrancy to an area. Research shows that people feel safer in neighbourhoods that are busier, especially at night. For businesses, more homes could lead to greater demand for some types of retail and hospitality, while additionally increasing the number of residents who live within a short commuting distance of their workplace.
Location, location, location…
Not all office or retail spaces are suitable for being converted into homes. Any candidates for conversion will require careful consideration from architects and developers, as well as consultation with existing businesses and residents.
One type of office space that might be best suited to conversion to homes is lower quality office space, which has seen the biggest drop in demand from businesses and therefore has a higher risk of staying empty in the future. Nearly half of what we defined as ‘subprime’ office space in central London can be found in a handful of areas, including Clerkenwell and the northern fringe of the City. Each area is unique and some are better suited to having more homes than others. For instance, office space in some parts of the City is unlikely to lend itself well to being converted to homes because of the density of commercial buildings and their high rise nature, while Clerkenwell already has a lot of housing which could make it more attractive to potential residents.
Ensuring central London continues to thrive
It was clear from conversations we had with businesses, developers, and councils that changing how we use buildings can have big and long-lasting consequences. Meanwhile, policy should seek to bring about homes that are affordable, well designed and good quality. We therefore caution against a rush to conversions and emphasise that any decisions should go through the planning system.
Central London plays a vital role in the cultural and business heart of the city. Our report Remixing Central London seeks to make sure that the area can continue to thrive as a centre of employment and business, learning and culture, and as a home for more Londoners too.