CBDs need to reinvent themselves to remain attractive and competitive in an environment of subdued demand for office space, fluctuating commuting and travel patterns and growing competition from emerging submarkets which offer access to a wide range of amenities, quality office space and rapidly growing populations. For example, in JHB, Rosebank and Hyde Park have become the new leading nodes, allowing for areas for leisure and living to be combined.
Factors that allow city hubs to succeed
1. Adjusting to hybrid working patterns
According to Workshop17, who are soon to open up their fifth urban location in Hyde Park, around 60% of office workers expect flexible working arrangements, with employees now working an average of 3 days per week in the office. CBDs will need to adjust to this new pattern of office use and accept that the hybrid work model is here to stay.
2. Long and costly commutes make CBDs less appealing
In the new world of work where employees continue to reassess their work-life balance, priorities have shifted and quality of life is now the number one consideration. Office workers are looking to cut their commute times with long and expensive trips to Central Business Districts now much less appealing. The solution to this is to have hybrid offices that work within your lifestyle, close to retail and entertainment that creates ease of access and saves time.
3. Property obsolescence and accelerating real estate decarbonisation efforts
Ageing buildings in CBDs continue to raise concerns over property obsolescence which presents a challenge for both occupancy and capital value preservation. Anchor corporates are choosing to move away from large, expensive shells that they need to maintain and decorate and prefer to partner with developers that give them more freedom and flexibility in the building process. The aim is to provide the best multi-functional work conditions so that corporations can offer options and attract and maintain the best talent in a competitive market.
Sustainability requirements present an additional challenge for older properties, as buildings will need to meet ever-more-stringent energy efficiency regulations. On a global level, more than 1 billion square metres of office space will need to be retrofitted by 2050. Retrofitting rates need to triple from barely 1% today to at least 3%-3.5% of stock per year if the global net-zero targets are to be met.
What does a successful CBD look like in 2030?
The key to unlocking the future potential of CBDs is retrofitting, repurposing - converting to alternative uses - and repositioning obsolete real estate.
Paul Keursten, CEO and co-founder of Workshop17, a business that follows a hybrid belief of providing beautiful work spaces, says, “To compete with emerging locations, CBDs will have to mirror their mixed-use characteristics. The changing demands will improve the mix of property types and encourage larger businesses to tailor their needs as well as those of their employees in a way that’s mutually beneficial.”
To showcase this philosophy is the new, partly built and partly refurbished Workshop17 extension located on top of the Hyde Park Corner Mall. Designed to be a sanctuary for calm and inspiration, they have used the latest data from their members as well as international nomad trends to offer something different. Keursten calls it the work space trifecta - the way that hospitality, retail and the option of larger, well designed corporate offices.
The 72 offices and 150 hot desks, including library lounges, pause areas and phone booths, are created so that the feeling of a hospitality environment works hand in hand with the convenience of a retail one around you, all under one roof, while supporting local businesses and entrepreneurs. All nationwide locations are available to members, facilitating travel.
Work together
CBDs will shift away from being primarily places of work towards becoming mixed-use destinations that capitalise on being at the heart of transport networks. These will no longer be larger, out of town areas but also mini axles that connect residential nodes with access to a wide range of amenities, as well as educational and cultural institutions.
Public and private stakeholders will work together to adapt best practices, adjust planning policies, improve infrastructure and increase investment in sustainability.
Cities will need to embrace change to revitalise CBDs, improve quality of life and address economic, environmental and demographic issues for a sustainable and inclusive future.
Workshop17 Hyde Park Corner opening October 2024
Workshop17 offers you fully serviced office space, flexible coworking options and meeting rooms in Cape Town, Johannesburg & Mauritius. Open 24/7. We currently have ten locations, growing to 12 in 2024. Individuals, teams and corporates, are all welcome.