Call centres boost business parks

Copyright: David Lawson - Property Week Jan 1997

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Chat-up merchants are the bane of† Susie's life. 'I don't have time to banter with† guys who want to get† personal. We are paid by the number of queries we handle.' she says.†† It is not her looks which spark interest. She is a telephone support operator for London Electricity, so callers are working blind. Her broad Geordie accent is the problem. 'It gives an excuse to ask where I am from, whether I support Newcastle Football Club and often ends in suggestions about meeting after work.'

She says her taxi-driver husband jokes that she should accept every invitation - providing he can arrange the transport. Callers return to†† discussions about wiring and meter readings when they realise† that Susie is sitting several hundred miles away on Tyneside.†† Thousands of bank and building society customers face similar confusion on hearing a variety of Welsh, Scottish, Irish and West Country accents when querying their accounts. Calls are increasingly likely to be diverted from local branches to centres on the other side of the country.

This is† good news for business park developers. Weighed down by† stagnant demand outside the south-east, they could see a chink of light through an upsurge in activity by a buoyant new sector. Headlines over NatWest's announcement to close 200 high street† branches overshadowed the fact that these will be replaced with a network of call centres. Grimleys won a beauty contest to find almost 42,000 sq m (450,000 sq ft) of space over the next two years. This could involve more than† 60 schemes.

And that is the tip of what is growing into a very large iceberg. Telephone sales and support are being adopted with gusto by sectors such as insurance, banking, computer software, travel and car hire. And just as back-office operations moved out of town centres to cheaper locations a decade ago, so may business parks benefit form a new wave of relocation.

Accurate figures are almost impossible to pin down because the market is so young - and changing so quickly.† Tony Fisher of Chesterton, which helped find a 20-acre site at Knowsley Industrial Park, Merseyside, for the TV shopping company QVC, estimates there are 20 major inquiries in the market.

Grimleys found at least 200 firms already in the sector when looking at potential tenants for Argent's Brindleyplace development in Birmingham. 'Many of these are growing fast and looking for extra locations,' says Anthony Payne, who carried out the research.

Several have already settled at Doxford Business Park in Sunderland after Mark Glatman, chief executive of Akeler, saw early signs of demand and went hunting for tenants like London Electricity. The privatised utility was† set to go to Docklands until he† showed they could operate more cheaply - but just as efficiently - from the end of a phone† in the north-east, he says. Glatman believes there are between 40 and 50 active inquiries† ranging from in-house projects to those seeking advice on development of new buildings.

The width of this spectrum can be a problem for developers, as it can be hard to† pin down what these firms want.† Direct Line, one of the pioneers of telephone insurance sales, has a standard† office building in Croydon, so its rumoured expansion into the regions could focus on similar premises.† Legal & General is taking almost 6,000 sq m (64,000 sq ft) of existing offices at Knox Court, Cardiff, while† in the regenerated docks area,† CableTel is understood to be working on† a new two-storey† call centre.

QVC, on the other hand, is building a 4,800 sq m (52,000 sq ft) telephone† centre and 11,600 sq m (125,000 sq ft) warehouse† on Merseyside and has planning permission to double this.†† Fisher has another occupier looking for a bog-standard 14,000 sq m (150,000 sq ft) shed it can fit out to office standards. 'There seems to be no generic pattern,' he says. 'It depends on the individual demands of a wide range of companies and makes speculative development difficult.'

†† Some common requirements help cut through this confusion, however. large floorplates are almost as essential as to City banks - and for similar reasons. Call centres cram together hundreds of screen-based operators. Payne puts a minimum at 1,400 sq m (15,000 sq ft) although Fisher says inquiries are generally for double that amount.

Technology is crucial. The QVC centre is expected to handle 1m calls a month, which puts a premium on cable-handling and communications infrastructure. Sheds are proving attractive to occupiers because they have the capacity to be fitted out with a lacework of wiring and the air conditioning required to handle so much electronic equipment.

'It is not a question of technical feasibility; it is more one of cost,' says Fisher. That often determines whether operators are willing to rent or prefer to buy. Glatman says Akeler has attracted users like London Electricity, One-to-One and The Insurance Service by building to shell and core levels, giving maximum flexibility for them to fit out. 'It is no more expensive if done properly,' he says.

†† Manipulation is more difficult for† services into sites, particularly where parks have been set up away from major centres. Fibre optic connections will be mandatory for centres which rely on high-volume† data connections as well as voice calls, says Glatman. Every building at Doxford† also has two telephone routes via BT and Mercury in case of† breakdown. 'It would be disastrous for a call centre to be cut off from its customers,' he says.

Akeler has linked with Sunderland council and university to go a stage further. European money is being tapped to† develop Doxford as a ú10m 'teleport'. This involves provision of cable and satellite services† for global data communications for the whole of the region.

The city also aims to† train† up to 50,000 people in 'telematics' - the skills involved in using telephone-linked computers over the next few years. It has already spent more than ú500,000 training 450 workers over the last 18 months as a way of attracting other firms into the area. Merseyside Tec is also spending almost ú2m on a special training programme for more than 1,000 local workers to meet QVC's needs.

Availability of this kind of worker is another important element in choice of location. Call centres require a special kind of worker which is not just able to handle the technology but with the patience to sit at a screen answering continuous calls from demanding customers and be available for 24-hour working. This last fact can militate against business parks which are not well connected by public transport. The wages for this kind of work means most workers will not have access to cars.

But at the end of the day money talks most loudly. Much of Doxford is an Enterprise Zone. QVC was persuaded to choose Merseyside rather than Ireland with regional grants worth more than ú4m while the site was reclaimed with a ú3m contribution from English Partnerships.

The biggest call centres are likely to†† continue gravitating† to areas where they can raise most money per worker. But that still leaves a swarm of smaller operations with more flexible demands which will emerge from the woodwork as banks close and more businesses adopt the telephone as a sales and support tool.

The Henley Centre has estimated that more than 2m people will be employed worldwide in telemarketing by the end of the century. It does not say where, however. Ireland is already grabbing much of the business and processes like airline ticket inquiries have shifted as far away as India. Unless UK developers can provide the right buildings, workers and infrastructure, this trickle could turn into a flood.