Hundreds of Goldman Sachs employees returned to their central London offices on 12 April. For some, it was the first time in over a year, writes Beth Hampson
With The City of London’s policy chair Catherine McGuinness reporting that most workers expect to migrate back to offices after the pandemic, it seems that the ‘great return’ has officially begun.
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Of course, it will take time to return to how we were before the pandemic. But what is apparent from working with businesses across London’s finance community is that a central headquarters is critical to many post-Covid strategies, particularly those on fast-growth trajectories.
Physical brand building
A key consideration for firms plotting their course out of lockdown is the role of bricks and mortar as a status symbol. For more than 12 months, the world has hosted its relationships via the internet.
Fostering a partnership by wining and dining, business lunches and catch-ups over coffee have been replaced with calls often hampered by poor connections and full diaries requiring one party to exit exactly on the hour. In fact, many fast-growing firms born during lockdown have had to initiate relationships from scratch over Zoom.
In-person interaction essential
Although technology has been a vital sticking plaster, it simply isn’t capable of becoming a permanent feature in an industry built on relationships. In-person interaction is a necessity. As such, for most firms, a central base is not an optional extra on the balance sheet but is vital for cementing connections forged in a Covid era and fostering the next stage of growth.
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By GlobalDataConversations with one of our own customers, Michael Schmitz, co-founder of investment firm Emerald Capital Management, highlighted this. Michael’s firm was founded from a kitchen table in January 2020 and then plunged headfirst into a pandemic. Yet, he committed to office space when restrictions allowed in 2020 and plans to expand them this year.
In his view, “clients may not invest in a company that has a HQ in a residential area or that is completely remote. They need to come in and visit and get to know the business in-person. Plus, in our line of work, a prestigious address and premium environment can go a long way when building a reputable brand.”
Now, Michael plans to use his office by St Paul’s in London on a flexible basis, meaning his team can come in and use the space a couple of times a week and its flexible lease will allow him to expand the office as his team grows this year with an expected recruitment drive. Stories like this make clear that, post-Covid, offices are in fact the physical roots that firms require as they attempt to exit the pandemic’s digital world.
A culture tech can’t buy
Whilst bottom lines and client contacts remain high on a firm’s agenda, our discussions with customers also revealed that culture is key post-Covid. Months of home working has had its pros and cons for all; but has this been more keenly pronounced for firms where directors and gradates often work in close proximity?
Take, for example, a working father’s feelings towards the remote model, which allows him to spend more time with his children and less time on the train, compared to a young eager-to-please graduate working 12-hour days in a Clapham flat-share – they will likely want a different post-lockdown model.
As such, having a central flexible workspace, which team members can drop into as they please, is critical for many firms as they map out an exit plan.
One of our customers Brett Rogers, Investment Director at Conviction Equities, explained that his office by Bank station in central London is key for this very reason. “Technology has been great, but we don’t see it as underpinning our future model.
Our London team needs a physical, central base that our younger employees can regularly use as a place of productivity away from their small city flats and that our directors can come into a couple of times a week”.
The office no longer has to have set hours and assigned seating; it is now a hub that each team member can use in a way that aligns with their preferred working style.
In a similar vein to Schmidt, Rogers concluded that a flexible space is at the crux of the firm’s post-lockdown plan. “Having a workspace that can expand as our headcount does will be vital in the months ahead”. An office can in fact be a facilitator of business agility in an uncertain climate rather than a contractual headache.
Plotting an exit path
For all the pandemic’s confusion and uncertainty, conversations with our financial services customers have made one thing clear – a seat in the city isn’t an optional extra. London is the world’s largest centre for international banking.
Having a physical headquarters within it brings brand value that a Zoom meeting could never replicate. What’s more, for an industry reliant on fostering junior talent, creating a working model within this global hub that suits them as well as the directors is key. For London’s finance community, the city’s bricks and mortar are set to play many roles in the industry’s exit plan.
Beth Hampson, Commercial Director, The Argyll Club
