The Workspace Advantage
A unique customer offer
1. Our market
2016 was one of the most politically turbulent years of the last decade. London commercial and residential property prices fell as an immediate reaction to the outcome of the EU Referendum, while listed London office companies saw share price falls.
However, investors seem to have warmed to commercial property in London once again as they see that it can offer stability in this politically challenging time, particularly with further political uncertainty emerging in other international markets.
The resilience of the flexible London office market is clear. The Capital continues to be a vibrant home for business, with a growing base of more than one million Small or Medium-Sized Enterprises1. Furthermore, in 2015, more than 90% of jobs in London were in the service sectors that primarily fill Workspace business centres.
As companies embrace collaboration, agility, networking and state-of-the-art design, Workspace is well positioned to capitalise on the opportunities presented by London’s real estate market. In particular, our world-class technology infrastructure - tailored to individual business needs with unlimited data usage and connectivity speed - continues to drive repeat business with existing tenants.
Amidst the shifting economic climate, Workspace’s leading-edge offering is proving increasingly appealing to a wide range of businesses looking for stability and commercial advantage in London. This year the real estate market has seen an even greater demand for the principles that underpin the Workspace Advantage: greater flexibility; technology infrastructure without limits; and dynamic environments that encourage networking and knowledge exchange.
Invested in office transactions in Q1 20172
Small or Medium-Sized Enterprises in London1
1 Source: House of Commons Briefing Paper on Business statistics.
2 Source: CBRE.
2. How we differentiate ourselves in the market
Welcome to the Workspace Advantage
How it works
Workspace customers are ‘wired differently’. Their attitude to office space is that it can be an asset to their business and can deliver long-term growth and success. At Workspace we have invested in equipping our business centres with a state-of-the-art, future proofed technological infrastructure.
There are ‘no limits’ placed on our customers. We understand that businesses are dynamic and require tailored business environments. We don’t constrain customers within the four walls of their office – Workspace business centres are equipped with well-designed breakout areas, co working lounges and meeting rooms, ideal for brainstorming or networking. Unlimited data downloads and uploads, at superfast speeds, allow customers to work however they choose.
Businesses choose Workspace to be ‘super connected’. Our customers have access to a range of networking and social events and opportunities to meet the neighbours often lead to business growth and fruitful partnerships. In addition, our dedicated Wi-Fi network installed throughout our portfolio keeps customers connected wherever and however they choose to work.
Who it’s for
The Workspace Advantage can apply to every type of business. For freelancers and start-ups, for established small companies and larger corporates, Workspace provides a tailored offer that allows our customers to focus on running their business.
100% ownership allows us to deliver the Workspace Advantage across our portfolio.
68 properties across London provide a strong pipeline of refurbishment and redevelopment projects to be delivered in the medium term.
To find out more visit our property portfolio.
3. The right strategy
This year, more than ever before, we have seen increasing evidence to give us confidence in our strategy and business model.
Demand is moving firmly towards highly designed and superconnected space let on flexible terms. Business owners all over London are considering a range of factors when assessing their occupational requirements. They are taking into account employee commutes, availability of meeting and breakout space outside the four walls of their office, proximity to excellent coffee, gyms and safe cycling routes as well as the quality of technology infrastructure and the neighbourhood community which can provide so many additional benefits to their business.
This trend is positive for us as it means that almost any business could be a Workspace customer and we are marketing to a much wider audience as a result.
With our space attracting freelancers, start-ups, established businesses and larger, more traditional organisations, the opportunities for us to grow our business are significant. We also have a strong pipeline of refurbishment and redevelopment projects, which will deliver more than one million sq. ft. of new and upgraded space over the next three years to satisfy the demand we’re seeing.
The insight and deep market knowledge that comes from our long history in London, alongside an inherent culture of innovation, have created a powerful combination that positions us well for future growth.
Chief Executive Officer
4. Delivering the Workspace Advantage
We have the right resources & relationships
We own and operate them to drive income and capital value over the long term.
Our suppliers & partners
Maintaining positive relationships is critical to the success of our business model.
We genuinely think differently and our customer-first approach and focus on innovation supports talent retention and attraction.
Constantly enhancing our relationships with customers is central to our strategy and we work hard to provide them with an advantage.
The strength of our brand sets us apart from our peers in the commercial Real Estate industry.
We have a responsibility to enhance the communities in which we operate.
During the year, 17 members of staff achieved long service awards
55 customers attended our first waste roadshow at The Light Box
Members of our team carried out 48 volunteering days and, along with customers, raised more than £31,000 for our charity partners
We manage the risks
In order to deliver our strategy and the Workspace Advantage throughout the business we must ensure that we maintain a balance between safeguarding against potential risks and taking advantage of potential opportunities.
Risk management continues to be an integral part of all our activities. We have an established Risk Management Structure in place to help us capture, document and manage risks facing our business. Risks and opportunities are considered in every business decision we make. We focus on the key risks which could impact on the achievement of our strategic goals and therefore on the performance of our business.
Risks are considered at every level, including when approving corporate transactions, property acquisitions and disposals and whenever undertaking refurbishment and development projects.
The Executive Committee meets weekly to discuss key performance measures and any change in these, meaning they are ideally placed to notice any concerning changes or early warnings.
Risk registers for all business areas are maintained and risks are assessed against a defined scoring mechanism.
The Workspace Advantage in numbers
Properties in London
Employee training days
Hits on our customer website
InspiresMe students given work experience placements
Raised by Workspace staff and customers for charity
Mobile devices connected on our managed Wi-Fi infrastructure installed at 16 of our centres
Users on our managed Wi-Fi infrastructure installed at 16 of our centres
2017 performance highlights
2017 performance highlights
Trading profit after interest*
EPRA NAV per share*
Enquiries per month
Dividend per share
Like-for-like rent roll
* For full definitions and commentary, please download the full annual report and see page 42 of the Business review, notes 8 and 9 on page 138 and the Glossary.
The right strategy drives future performance
The right strategy drives future performance
This strategy has been in place for over five years now. Its relevance and different component parts are discussed and debated regularly at Board and Executive Committee meetings and we continue to believe that it is the right strategy for the business.
In fact, we believe that the wider real estate market is moving ever closer towards our strategy with companies adapting in order to meet the increasing demand for flexibility, well-designed office space with all the right amenities and a secure, reliable technology offer.
Grand Union Studios
Strategy in action: Let up ahead of expectations, more in the pipeline
The new Grand Union Studios on Ladbroke Grove opened to customers in March 2016. By December 2016, it was 80% let, at pricing significantly above expectations, demonstrating the strong demand we continue to see from customers for our space.
The success of this project gives us the confidence to proceed with our extensive pipeline of refurbishments and similar redevelopments. During the year, we received planning consent at four sites, including for refurbishments at Pall Mall Deposit, also in Ladbroke Grove, and Mare Street Studios in Hackney.
Strategy in action: Training to be the best
We hold regular training sessions and interactive workshops for different departments in order to ensure our employees are fully up to speed with the latest regulatory developments and have access to career development opportunities.
With such a focus on customer service, it is vital that our frontline teams are well trained and have a clear understanding of our brand values and proposition.
Members of staff attended 889 training days or workshops during the year on subjects ranging from facilities management (pictured here) to data protection.
The Leather Market
Strategy in action: Refurbishment to improve services and design
One of our most iconic business centres, acquired in the early 1990s, The Leather Market is a listed building in London Bridge. It is currently under refurbishment to bring the services and design up to the high standards that our customers require today. The project, which completes in August 2017, includes the creation of a newly designed entrance, high quality café and connected meeting rooms.
The recycling of capital receipts from disposals to fund our ongoing refurbishment programme is a key part of our strategy and helps to drive income and capital value growth.
The Record Hall
Strategy in action: Taking advantage of market opportunities
From a tired office building that had reached its maximum pricing potential, in a hugely popular area just moments from Farringdon’s Crossrail station, Workspace has launched its newest business centre on to the market.
We have already seen good demand for The Record Hall in Hatton Garden, which will boast 89 units, roof terraces, Club Workspace, high-spec meeting rooms, workshops for jewellery traders and the trial of a new café partnership for Workspace.
Strategy in action: Filling the pipeline
In April 2017, we acquired 13-17 Fitzroy Street, a fantastic building in a very attractive central London location.
Let to engineering firm Arup until 2020, the building will then enter our refurbishment pipeline with plans to reposition it as a multi-let business centre for our customers.