Navigating The Challenges Of Empty Office Space In The UK

Recently, the UK has seen a noticeable surge in office vacancy rates nationwide. Currently, the number of vacant office spaces across the UK is 102 million square feet — its highest level since 2014.

Across the business sector, these vacant spaces are causing valuable resources to go to waste, potentially hindering the economic growth of several key cities and regions. With additional issues such as aesthetic decline, security and maintenance concerns, and impact on property values and residential space, it’s time for society to tackle the issue head-on.

Luckily, there are resources to help you overcome the challenges posed by empty office buildings in the UK, but first, let’s take a closer look at the reasons behind this shift in the commercial property landscape.

1. The Pandemic’s Impact on Office Spaces

The COVID-19 pandemic has completely changed how we view and use office spaces. From the moment the pandemic began, business owners had to get creative to ensure their operations could survive the uncertainty of a global crisis.

Having all experienced extended work-from-home periods during lockdowns, many businesses were left with no choice but to rethink their office needs. Even for the most traditional companies in the UK, the pandemic forced a rapid shift to remote work arrangements.

Post-pandemic decisions: The future of office space

While for some businesses, having a designated place to work from will always be preferable, for others, remote working can boost productivity, save on office maintenance costs, and contribute to a healthier work-life balance for employees.

However, with the future of ‘work-from-home’ culture still uncertain, business owners still face a tough dilemma when it comes to vacant office space; do they retain the space for the possibility of a full return to the office, or are flexible office solutions here to stay?

This decision is critical as it can significantly impact business operations, employee satisfaction, and overall productivity.

Here are some key factors to consider when making post-pandemic office decisions:

Cost Considerations

It goes without saying that all commercial real estate comes with its costs. However, aside from high rent or loan repayments with rising interest rates, business owners also need to take into account:

• Utilities
• Maintenance fees
• Business rates

Client Meetings and Brand Image

Physical office spaces can leave a lasting impression on clients, conveying credibility and trustworthiness. However, with communication platforms such as Zoom now firmly integrated into our professional lives, home offices can now function just as well as those in a designated office building.

Employee Preferences

Every business will be different, but for many managers and business owners, the need for office space can depend on:

• Employee preferences
• The nature of the work being carried out
• The productivity levels across your workforce

Company Culture and Team Collaboration

Face-to-face interactions can be important for creativity and team bonding. However, with the development of virtual collaboration tools, companies now have endless options to engage and unite employees worldwide.

Technology and Infrastructure

In the office market, older buildings are paying the price for poor technological infrastructure. From senior managing director duties to entry-level roles, businesses now demand modern, high-tech office spaces catering to the evolving needs of their employees and clients.

This leads to:

• A shift in the perception of office spaces from traditional to tech-driven environments
• Growing preference for modern amenities and smart systems, driving demand for ‘tech-forward’ office spaces
• Higher expectations for seamless communication and connectivity, prompting businesses to prioritise efficient digital infrastructure
• Competitive advantage for businesses operating in modern, high-tech office spaces (office markets reflect this)
• Emphasis on the ability to ‘future-proof’ office spaces to adapt to ongoing technological advancements

2. Hybrid Working Models

While the pandemic has significantly impacted the prevalence of empty offices in the UK, hybrid working models are their own entity in terms of reshaping the future of work.

Employees now seek greater autonomy and control over their work schedules, with a desire to achieve a better work-life balance.

As businesses adapt to this demand, flexible work arrangements, such as hybrid working models, have become critical for keeping employees happy.

Here’s how:

Flexibility is key: The desire for flexibility is at the forefront of the employee experience. Businesses that offer hybrid work options can meet this demand, fostering a more satisfied and engaged workforce.

Empowering employees: Hybrid work puts employees back in the driver’s seat, giving them the freedom to structure their workday in a way that suits their needs and preferences. This empowerment translates to increased motivation and productivity.

Attracting top talent: In the post-pandemic era, job seekers prioritise work arrangements that align with their lifestyles. Companies that embrace hybrid models gain a competitive advantage in attracting skilled professionals seeking more agile ways of working.

Retention and well-being: Employee retention becomes a focus as businesses recognise the link between flexible work arrangements and employee well-being. Satisfied employees are more likely to remain loyal to their organisations, making a hybrid working model appealing to employees and employers alike.

3. Adaptation Challenges for Existing Buildings

Big players like Google have set the bar high with innovative office environments filled with recreational spaces, modern amenities, and inviting canteens. But this has made traditional office setups look outdated in comparison.

It can be a real challenge for businesses to keep up with these higher standards and provide attractive workspaces to lure in employees. Consequently, some office spaces end up empty as companies struggle to meet the modern workplace’s evolving expectations — with company culture now demanding more than just a fancy coffee machine or ergonomic chairs for workers.

So, in lieu of an attractive office space, how else can you boost company morale and cultivate a thriving company culture?

• Employee Recognition: Implement programs to acknowledge and celebrate employee achievements
• Professional Development: Offer training to enhance employees’ skills and show commitment to their growth
• Team Building Activities: Organise in-office and virtual team-building events to strengthen bonds
• Open Communication: Encourage transparent communication, valuing employee input
• Employee Wellness: Promote well-being through fitness challenges and mental health support
• Social Events: Organise in-office and virtual gatherings to foster social connections
• Diversity and Inclusion: Foster a diverse and inclusive work environment

4. The Cost of Living Crisis

The UK’s cost of living crisis is also playing a significant role in the presence of empty office spaces in the UK.

Expensive transportation and even overlooked costs such as lunchtime dining are taking a toll on employees’ finances and willingness to work from centralised locations. As a result, businesses are having difficulty filling office spaces, leading to higher vacancy rates.

Some of the main cost concerns for UK employees currently include:

• Housing costs (particularly in strategic business locations)
• Commute expenses (including public transport fares and fuel expenses)
• Dining costs
• Childcare costs (especially in large cities and business districts)
• Entertainment and leisure

How to Minimise the Financial Impact of Having an Empty Office

When it comes to vacant space in the office sector, there are several factors contributing to high rates across the UK. With this unlikely to change overnight, it’s now on business owners and commercial landlords to take matters into their own hands.

This is where Verity comes in. With our business and real estate management expertise, we’re here to offer practical solutions to your empty commercial property challenges.

Taking care of all the paperwork and administrative burden of managing empty properties, at Verity, we help you:

• Save 100% on empty property rates
• Find huge business rate rebates for occupied properties
• Navigate the legal red tape

Get in touch today and stop paying unnecessary business rates. We’ll assess your bill for savings opportunities and call you back with free, actionable advice.