With employment land under increasing pressure from housing, and with the coming devolution of business rates opening opportunities for revenue generation, workspace provision is an increasingly hot topic for local authorities. On 13th June, Future of London brought together public-sector practitioners involved in workspace provision to share best practice in supporting small businesses and local economic development.
The event kicked off with sparky presentations from workspace providers who outlined their models and provided food for thought:
- Paul Augarde, Head of Creativity and Innovation, Poplar HARCA
- David Fletcher, Founder, Wimbletech
- David Kosky, Co-founder, Work.Life
- Sara Turnbull, CEO, Bootstrap Company
- Angela Whitehead, Lodger Liaison, Alan Baxter Ltd.
The providers’ recommendations and priorities included:
- taking a coordinated, area-wide approach to encourage the right mix of workspace;
- making more use of space in publicly-owned buildings;
- being flexible enough to respond quickly to new opportunities;
- being accessible to varied markets (e.g. space for freelancers near their homes);
- creating a membership offer that works for the intended audience;
- the importance of long-term leases for viability;
- the benefits of owning a building; and
- the importance of fostering community within a workspace
Participants then split into groups to discuss best practice, sharing recommendations and advice which is summarised below.
How to identify the right provider
Do: Understand the outcomes first
Decide what outcomes you want the space to produce, and bring in a provider based on these, eg to bring in high-growth companies, provide affordable space, or give training in the local community.
Do: Understand the local community and its needs
Understand what the existing community needs – what works in some areas might not be appropriate in others and different communities will need different types of spaces. Once you have this mapped out, you can get a sense of who you want to attract to work in the area and build the workspace structure around this.
Do: Understand viability and feasibility
Assess a provider’s business model and make sure it’s viable and feasible within any constraints (e.g. funding, type of space, location, timescale). Don’t parachute in ideas from elsewhere without testing feasibility/viability in your own context first. Speak to providers early in the process and make sure the offer is attractive and works for them.
Don’t: Create white elephants
Don’t replicate a model just because it’s been successful elsewhere; don’t implement a project without having a good understanding of how it will work in a new context.
How to design a space that facilitates productivity and growth
Do: Be flexible, get advice
In new-build workspace, make sure the space is flexible enough to be adapted to different uses. If possible, apply for funding to help with fit-out costs.
Speak to potential workspace operators early in the process and get expert advice on how best to use the space for its intended purpose – retrofitting is expensive, whatever the age of the building. Colleagues working in regeneration and planning policy may be able to provide guidance on what constitutes suitable design specification and fit-out, and what to look out for in assessing proposals.
Do: Understand your market to bring in the right provider
Know your target audience and match it with a provider who has experience in that market; this will help keep space affordable, for example by not overproviding services that won’t be used.
Do: Design the specification to fit the tenure
The specification should take into account the length of time the space is available for: a space with a long-term lease will be able to meet higher standards than a meanwhile space. Design the space and management to fit the tenure and allocate funds appropriately – don’t spend lots of money fitting out a space that will only be around for a short time!
Don’t: Spend too much on fit-out before you know who will be occupying the space
Avoid overdoing it on fit-out before you know how the space will be used and who will occupy it. Adapting spaces to different uses later on is costly, and could impact affordability.
How to develop an effective management model
Do: Start with an understanding of desired outcomes
Understand the desired impact and derive the management model from that. Different models will be attractive to different types of user, eg start-ups vs freelancers vs established businesses.
Do: Know why you’re investing and monitor progress against that
Understand why the public sector should use its assets and what it gets in return; agree metrics for evaluating the investment. Compare agreements and outputs with other councils and GLA investment programmes. Use GLA benchmarks (see below) to get standardised, comparable data.
Do: Have a local authority lead for workspace who can take a strategic view
Getting the most from workspace requires dedicated staff time and resources, ideally with someone who can take an area approach to workspace, looking at what an area has, what it needs, and how to manage provision so that it meets those needs rather than treating each site in isolation.
While funding is limited, this role could be part-funded by developers and/or workspace providers, on the basis that this curatorial role would add value to their investments.
Do: Involve colleagues in different departments
Successful regeneration needs good internal relationships across departments. Establish a corporate mandate and encourage communication and information-sharing across economic development, skills, regeneration, planning and property teams.
Don’t: Assume any one model or one-size-fits-all approach will work
The management model should be responsive to local context and desired outcomes.
How to select suitable tenants
Do: Understand the area’s community and history, and contribute to the story of the place
Understand how the workspace fits into the overall character of the neighbourhood and find a provider that can contribute to this narrative. This could be through a contractual relationship (eg requirement to contribute to local community), or by targeting tenants with particular attributes.
Do: Tailor an approach for each space/neighbourhood
Understand what is appropriate for the area in terms of the scale and mix of workspace and the types of tenant it will bring. Use this to tailor an approach which suits the context.
Do: Decide the extent / level of management
Will your space be ad hoc, with head-down freelancers or agencies coming and going and a traditional landlord-style set-up? Will it be a highly facilitated community with social, community or training activities and a requirement to give back or pay the London Living Wage? This spectrum draws different workers and companies, and delivers different costs and impacts.
Don’t: Let the local authority curate tenants
Take a step back and get a good provider who can do it. Experienced providers have a more nuanced sense of what businesses are appropriate and will benefit most from a space.
How to support businesses
Do: Explore different models of business support
Be aware of the different ways of providing support. These include signposting to external services; attracting grant funding to bring in specialist providers; and providing support in-house as part of the workspace business model.
Do: Allow tenants to contribute time and expertise to the community
Provide a mechanism whereby tenants can share knowledge and expertise among themselves, or volunteer for the benefit of other tenants or the local community. These might be included in a contractual relationship or more informal, such as networking and skill-sharing sessions.
Do: Make sure the provider is committed
Work with providers who are experienced at providing training and support alongside workspace.
Don’t: Take this element of the offer lightly
If using an outside provider, make sure they provide quality services and have a proper business model. If sharing internally, keep it organised. A half-hearted effort at business support will damage the facility’s reputation and lower expectations of tenants
How to measure the regeneration impact of workspace
Do: Use recognised measures to evaluate impact
Use established measures such as those listed in the London Regeneration Fund prospectus, which includes:
- Jobs created, jobs safeguarded
- Area of public realm improved
- Number of buildings or shop fronts improved
- Value of match funding secured
- Number of businesses supported, number of pre-starts supported, number of businesses improving performance
- Number of cultural events held
- Increase in footfall
- Area of commercial space created or improved
- Local environmental improvements.
Do: Monitor devolved business rates retention
As business rates take on greater importance through devolved funding, monitor the amount of business rates being retained within the within the borough. Providing clear pathways for business to grow and move premises without leaving the borough will be increasingly important, and being able to show links between workspace provision and increased business rates receipts could be useful for demonstrating the value of workspace for economic development.
Do: Consider soft/less tangible benefits and broader strategic impact
Look for ways to measure impacts on strategic council or GLA priorities, such as effects on wellbeing, relief of traffic congestion, etc.