New record headline office rents in Watford
Is WFH the future?
The workplace has changed considerably in a short space of time. While WFH is not a new thing, Covid certainly changed the dynamic as to how it is viewed by employees and employers alike. Suddenly the vast majority could be productive while away from the office and remote or hybrid working are now considered normal practice.
However, with the rise of the cost of living crisis, could we see a return to the office for the majority of employees on a part time basis at least?
Certainly, there are a number of employers who would be keen to have their employees back on a more regular basis, but employees needs have changed and it will take far more than a good supply of biscuits and coffee in the kitchen to bring them back. Similarly, it’s not just employers recognising this. If you take a stroll down Clarendon Road in Watford you will see a number of buildings having been refurbished with this very clear message in mind, and that is getting staff back to the office.
Landlords are all seeking to provide best in class accommodation and the phrase ‘flight to quality’ is becoming more relevant, particularly for more corporate occupiers. Whether it is the communal roof top terraces, break out space or the events put on by landlords, the relationship between the building, the landlord and employer is evolving. This is evident in the take up stats in the local market. Across Hertfordshire and the regions, Grade A offices have seen the biggest amount of take up and account for nearly 70% of the transactions in Watford for 2022. This rate gets higher in St Albans where a number of Grade A buildings are being released back into the market.
Consequently new record headline rents are being set in these locations with Watford at £37.50 per sq ft and St Albans now at £41.50 per sq ft. It is envisioned that while stock levels continue to remain low, this trend will be set to continue as tenants seek out the best possible space to tempt their employees back to the office.
With the cost of living increasing considerably, and the chances of a recession possibly looming, it might be that employees feel more at home at the offices that have been designed with them in mind.