“Reports of death of office have been greatly exaggerated”

Friday 25 February 2022

A survey of Channel Island businesses has found that reports of the office’s death have been greatly exaggerated.

Pan-island business D2 Real Estate has published its latest Channel Islands Office Market Review for 2022, based on a survey covering activity and opinion from 145 businesses across Jersey and Guernsey.

The results show that early in the pandemic the need for office space was questioned, as occupiers could work from home. 

By late 2020, however, this thinking was being challenged, and businesses believe many of their core functions require an office.

Pictured: D2 Real Estate Managing Director Phil Dawes.

The report finds: “Most businesses are now set up to offer the option of home working, and a degree of flexibility is allowed, particularly given the high priority cited for staff wellbeing. 

“This has filtered through into the market with many occupiers refurbishing their premises, and creating collaborative spaces. 

“For many reasons, not exclusive to home working, some space is being released, but we are also seeing a high level of new enquiries, with some occupiers taking the opportunity to upgrade and relocate to prime locations.

“Our survey reveals the Channel Islands’ unique occupational market dynamics compared to other jurisdictions, with several distinctions, such as shorter commutes and minimal office supply, which is reflected in rents and pricing.”

D2 Real Estate Managing Director Phil Dawes said: It’s been another extraordinary year. From the very beginning, 2021 seemed intent on giving 2020 a run for its money in terms of disruption and drama. 

“Overall the occupational market has been stronger than last year, with a flurry of recent enquiries. Phase three of the Jersey International Finance Centre is underway off the back of a 75% pre-let, and Guernsey’s first development for over ten years has just completed. 

“We are, however, also seeing some stock being released. It is tempting simply to point to increased numbers of home workers, but other factors are also at play, including several corporate sales, mergers, acquisitions and the acceleration of outsourcing. 

“We are therefore at an intriguing crossroads, with some consolidating and downsizing for various reasons, but also some occupiers with an opportunity to relocate committing to new premises, including substantial pre-lets for 15-year lease terms or more.”

The survey also finds that the impact of Environmental, Social and Governance (ESG) is yet to be fully felt but is gaining momentum. It concludes that those that do not act now could be left behind.