Following on from last week’s blog looking at the evolving relationship between HR and real estate, it is very timely to see Cushman and Wakefield CEO Digby Flower’s interview with Bloomberg TV on Friday. With 2014 set to be a record year for take up in the London market, Flower refers to the “war for talent” as one of the key factors influencing businesses such as Amazon and Vodafone to relocate into London from the regions.
These publicised moves are the reality of the alignment between HR and real estate that I discussed last week, where location is paramount for attracting and retaining the best talent. Simply put, when this talent wants to live in London (or urban commercial capitals), then the companies fighting for this talent need to be there physically. This urbanisation of talent has already seen US West Coast based companies relocate to the San Francisco Bay Area as the lengthy commute to the Valley interrupts productivity, increases commute times and impacts a work- life balance.
In the UK, national employment growth in the TMT sector alone is set to increase by just under 200,000 by 2018 driving the demand for occupational property further. Though the cost per square foot will inevitably continue to increase in key cities, space is being utilised more efficiently and creatively bringing down the average cost per head. HR, real estate and technology teams working in tandem are redefining the way space is acquired, designed and delivered so that businesses can continue to contend in the “war for talent”.