The world's oldest asset class is going to go through a fundamental epoch defining change over the next decade as the need for office space takes on a different dimension. Or maybe not...I am very hesitant to draw too many conclusions too soon but even people who have not consistently worked from home prior to the lockdown are telling me 5 days a week on a commuter train and glass tower is not part of their futures.
This of course has huge implications for the City - fewer finance professionals means fewer coffees, pints, sandwiches to be bought. But it has wider implications in terms of how offices are set up and for whom. The end of open plan? No more staff canteens? And what of residential development in major metropolitan centres? Why would you need to live in cramped city centre accomodation if you are spending less time there?
Fascinating to see how the next 10 years plays out.
Real estate, like education, is one of those dangerous subjects in which everyone thinks they’re an expert. We have all been to school, so we think we know about education, and we all live somewhere, so we think we know about property. As the purchase of our living quarters is the biggest transaction most of us ever make, we tend to have strong views about the market. This makes real estate one of those asset classes where there is still some real reason to believe that an actual expert, who can see through everyone else’s mistakes, could make a real killing, or generate alpha.