Occupiers move back into the suburbs

Copyright: David Lawson – Financial Times  2001

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Ten years ago European offices appeared set for on a one-way ticket out of crowded cities into greenfield business parks.  The UK lead the charge but even before the rest of Europe has had chance to join the rush, the focus has moved back to the suburbs  Tighter restrictions on development linked mainly to cars is the obvious villain but other factors are just as powerful.

  Occupiers were driven out because congested cities could not provide big, efficient buildings required as companies merged and adopted new technology. But people-power has reasserted itself.  A new young workforce wants more than green fields and swish offices. 

 ‘People miss the advantages of cities. They want to live close to work, then have easy access to  social life afterwards,’ says Sir Stuart Lipton, the developer who helped pioneer business parks in Europe. He believes that even without parking restrictions the pendulum would have swung back.

  Suburbs are now seen as attractive because they are close enough for fast transit into town but far enough out to provide big development sites. La Defense in Paris and Canary Wharf in London started the trend to relatively short distance moves and Charles Graham of Europa Capital Partners now sees a wider move to city fringes. ECP is investing more than 1 billion Euro in fringe developments such as the Gasometer in Vienna and Almeda Park, Barcelona, to provide what he sees as vital factors – a high profile, access by public and private transport and convenience to city centres and airports.

   Planning is still important, says Lipton, but not necessarily through the negative influence of parking controls. In the UK, which has seen the most pressure for out-movement, local authorities are allowing suburban high-density development they would have rejected in the past. This has enabled his company, Stanhope, to begin a ‘mid-urban’ park at Chiswick, half way between the City of London and Heathrow Airport, a decade after he was defeated by a combination of occupier apathy and planners’ resistance.

  Lifestyle is a central part of selling the park as Stanhope appeals directly to the new breed of workers. Again it is a trend that is being learned from the US, where a study by international consultants CB Richard Ellis found integration of work and social life has become a prime consideration. The trend was born among new technology occupiers but will quickly spread through the economy and as employers compete to attract skilled workers on this side of the Atlantic,  says Nick Axford, head of European research.

  This could have a fundamental impact on development plans and investment values. Chiswick Park is being built on an old bus station site which has languished for years. The former Renault works in Paris has taken on new life as a new business district on the fringe of the traditional office area. Similar brownfield sites have become a focus for development, says Tony Fisher of Chesterton International.

  Transport is still a key factor. ‘We are looking at nothing other than sites connected by rail,’ says Fisher. But the two interact, as many brownfield sites are left from an era when industry relied on rail. Even land still used for industry will come under pressure to be converted into higher-value offices.

  But activity will vary across Europe. Parking restrictions, for instance, may appear universally severe but are a problem only in the congested south-east UK and around cities such as Amsterdam and Brussels. UK provincial centres and most cities across mainland Europe will negotiate generous parking levels in exchange for jobs. Trevor Silver, chief executive of US-owned Akeler Developments,  says he has found no heavy restrictions imposed on schemes such as a 300,000 sq ft tower and 1 million sq ft business park being built outside Frankfurt. ‘Countries like Italy actually set minimum rather than maximum car spaces’, he says.

  Julian King, another Brit running Europe for a US corporation, HQ Serviced Offices, has found similar anomalies. In Amsterdam, his suburban development has tight parking restrictions but a public car park next door.

  The wide variety of local factors influencing development would make prediction of hot spots difficult if it not for the fact that transport still plays a common role. Most suburban development is already tied into rail links or clustered around airports because mainland Europe never took the route to greenfield parks. Even in the UK, smaller centres such as Manchester, Birmingham, Bristol and Leeds have come late enough to  follow this trend, which is likely to continue right across Europe.

  This does not mean greenfield business parks are dead, says Chris Hiatt, a European director of consultant Jones Lang LaSalle. Some activities such as car borne sales forces will always lean towards private transport. And he points out that the UK still has between five and ten years’ supply of  land with permission for development.

  But even these will increasingly offer transport choices. Stockley, which set the pattern for European business parks more than a decade ago,  is now seeing almost half its staff come via bus and is campaigning for a rail station.  Proposals by designer DEGW for  the final stage also call for ‘clustering within a more dense urban environment’ to meet modern needs. The buildings themselves will be large, friendly, ‘green’, infinitely flexible to cope with rapidly changing business activities, and nested among social facilities.   In other words, the office of the future will become almost indistinguishable whether on the fringe of city centre, in the suburbs or on a greenfield park.